Latvian investor forced out of Shklou23
- 14.03.2014, 8:20
Latvian business can lose its last industrial investments in Belarus by the end of March.
Lukashenka’s administration ordered the local authorities to find a new investor for Shklov Forest LTD by April 1, 2014. The decision was made because Latvian owners of the company failed to organise the process of high-level wood processing for the past ten years, Zavtra Tvoey Strany writes.
According to the Bank of Latvia, the accumulated direct investments of Latvian business in Belarus were about 20 million euros at the end of 2013, including 11.3m euros for wholesale and retail sale, 5.8m for financial intermediation and 2.2m for the industrial sector.
Shklov Forest LTD was founded in 2002. It is one of few Latvian investors in the industrial sector and Belarus’s economy.
Belarus was left almost without industrial assets of Latvian businessmen, after owner of Liepajas Papirs Janis Vilnitis had sold his stake in a Rechytsa-based company in 2013.
Shklov Forest was created for logging and processing drying fir forests (about 25,000 cubic metres of a forest). The company was successful in this direction, but the Belarusian authorities asked the owners, among them American Commander Capital LLC and Riga-based Lindeks, to process wood at a deeper level.
Aigars Kimenis, the owner of the Latvian company, has logging and trading companies in Latvia and Russia and sells about 200,000 cubic metres of timber mostly in the UK. He also owns a retail chain to sell gardening supplies.
Shklov Forest LTD began to produce sawn timber and promised to produce wood pellets and trim moldings. The deadline for the projects expired in November 2013. Head of Lukashenka’s administration Andrei Kobiakov said during his visit to the plant in February that the company had been using the state’s preferences, but made no investments. He thinks the founders have no serious intentions and cannot be serious investors, so the Belarusian authorities want a new investor.