China Refuses To Write Off Belarusian Authorities’ Debt For Satellite

Meanwhile, Minsk is going to launch the second one.

In January 2016, the Belarusian satellite Belintersat-1 was launched from a cosmodrome in China. This allowed the authorities to declare that Belarus has become a space power. The implementation of the project attracted nearly 300 million dollars. True, in March 2019, the government of Belarus offered its Chinese partners to write off a debt of $ 230 million, as the project turned out to be unrecoverable, tut.by writes.

The project “Creation of a national satellite communication and broadcasting system of the Republic of Belarus” was financed through an intergovernmental loan provided by the Export-Import Bank of China. Its sample was completed in 2016 and actually amounted to $ 258.6 million. The Chinese industrial corporation “Great Wall” launched the satellite "Belintersat-1" into orbit and created a ground-based satellite control complex in the village of Stankava, Dziarzhynsk district, which is part of the state-owned enterprise Precision Electromechanics Plant.

“At the same time, during the commercial operation of the satellite, problems arose that significantly affected the payback of the project. Along with the Belarusian satellite with traditional technology on the DFH-4 platform, more competitive high-capacity satellites HTS have appeared. In addition, the prices for satellite communications resources since the start of the project in 2011 have decreased by 3-5 times on average. As a result, a business plan that allows servicing the above loan has become impracticable,” Prime Minister of Belarus Siarhei Rumas wrote to his Chinese counterpart in March 2019. The payback of the project was also influenced by the fact that the Chinese company was unable to complete the coordination of the Belarusian satellite with satellite systems of third countries, which did not allow to fully offer the satellite resource in the communications market, the letter says.

For these reasons, this project has become stranded. At that time, Belarus transferred 51.6 million dollars to service and repay the loan, but “further payments from the project revenues cannot be made,” Rumas wrote. As “the most optimal solution in this situation”, he proposed to write off the rest of the debt on the Export-Import Bank of China loan in the amount of $ 232.7 million of the principal loan, and the interest.

But, as the journalists found out, this decision did not find support from the Chinese side. “Now the enterprise itself pays the debts and helps the Ministry of Finance of Belarus,” informed sources said. The Finance Ministry refused to comment. The Precision Electromechanical Plant said they did not have information about Rumas's letter.

As of the first quarter of 2019, the first Belarusian satellite was loaded by 35-45%. Precision Electromechanics Plant is good at working with customers in Africa. The demand remains on the part of the Belarusian power structures. “For them, this is not just a service, but a guarantee of independence from foreign operators and technical solutions, in fact, a guarantee of the sovereignty of our country,” they say at the Precision Electromechanics Plant, which specializes in projects in the military-industrial complex.

According to journalists, the idea of the Chinese-Belarusian project was to make a profit in foreign markets and provide services within the country, primarily for the security forces. But the development of new technologies, changes in the market environment have significantly called into question the implementation of the business plan. Almost complete coverage of the territory with 4G cellular networks is ensured in Belarus, the number of subscribers of fixed broadband Internet access is actively expanding. Against the backdrop of intense price competition, this narrows the circle of customers potentially interested in using satellite communications.

Now the operator of the national satellite communications and broadcasting system is planning to study the optimal development options for the period when the Belintersat-1 apparatus will be completed in 10 years. “It can be replaced by a new satellite based on a technological platform corresponding to the level of advanced solutions in the second half of the 2020s. Or, the option of leasing the spacecraft capacity will be more profitable,” said Leanid Fiadotau, a leading specialist at the Precision Electromechanics Plant, to neg.by.

The Belarusian authorities intend to support space initiatives. On August 31, Aliaksandr Lukashenka signed an order on the launch of the second space satellite by the Belarusian State University in 2021.