Belarus bans import of Ukrainian sweets

Belarus has halted the confectionery import from Ukraine.

The decision of the Belarusian Council of Minister on licensing the confectionery import has led to stopping the import of Ukrainian candies to Belarus. The statement was made by Oleksandr Baldinyuk, the head of the The Ukrkondprom Association, LIGABusinessInform has learnt from the Association's press service.

According to Oleksandr Baldinyuk, Belarusian officials are ready to issue licences if Ukrainian confectioners significantly increase prices by from 30% to 500% of producers' prices, the demand that won't allow selling their products in the Belarusian market.

The Ukrkondprom head noted the decision of the Belarusian authorities, which gives them the right to demand Ukrainian confectioners keep to the administratively set minimum prices, conflicts with the international obligations of Belarus, violates the fundamental competition principles and creates unequal conditions for selling Ukrainian confections in the Belarusian market.

According to the estimates of the Association, these actions by Belarus will cause a significant damage to Ukraine of up to 130 million hryvnias by the end of 2014 taking into account the decline in collection of income taxes, the fall in foreign currency revenues, personnel cuts in the confectionery sector and the relating sugar, flour, starch, packing, fat-and-oil, dairy and other industries, cuts in payments to salary funds, etc. It is expected that inner demand for sugar will fall 15,000 tonnes, flour – 12,000 tonnes, starch – 7,000 tonnes, oil and fat – 3,000 tonnes, dairy products – 1,000 tonnes and the agricultural sector staff will cut by 2,500 people.

On May 16, the Council of Ministers of Belarus adopted resolution No. 469 “On licensing the import of certain types of pasta, confections and raw materials for their production outside the single customs area of the Customs Union”. Under the resolution, the import of confections to Belarus outside the Customs Union is carried out on the basis of one-time licenses issued by the Belarusian State Food Industry Concern Belgospishcheprom. The application for the license must be agreed on with Belgospishcheprom if the concern and the confectioner have agreements on supplies to Belarus setting minimum prices of confections.

Belarus is the world's fourth market for Ukrainian sweets. According to the Ukrainian Tax Ministry, Ukraine exported 24,400 tonnes of confections at a sum of $70 million to Belarus in 2013. Ukraine's import from Russia was 1,200 tonnes at a sum of $3.3 million last year.