Foreign Capital Is Leaving Belarus

Even Russian companies are curtailing their activities in the country.

Officials released information on companies that attracted foreign investment. The reporting period turned out to be difficult for such organizations, banki24.by writes.

Statistical bodies refer to organizations with foreign capital as companies of the real sector (except for banks and NKFOs) if at least USD 100 of foreign investment has been invested in their statutory funds. Annual data includes small and micro-businesses. Therefore, these statistics can be considered quite comprehensive.

By the beginning of 2021, the number of organizations with foreign capital dropped to 6503. A year earlier, officials counted 6623 such companies in the country.

The concentration point of companies with foreign capital is Minsk. In the capital, 3576 organizations reported to the statistical agencies (a year earlier there were 3619 of them). In general, Minsk accounts for 55% of such businesses from the total number in Belarus.

In terms of the origin of capital from the CIS region, the number of organizations with foreign investments is absolutely dominated by Russian ones - 2315 units. Although, a year earlier, there were more of them - 2391.

Ukraine is in second place in the CIS ranking by a large margin from the first - 314 companies (a year earlier - 324).

It turns out that, in 2020, the Belarusian economy has lost some of the companies from these countries. The probable reasons are the global crisis and the situation in the country after August.

Several hundreds of companies in Belarus represent capital from Lithuania (545), Cyprus (438), Poland (322), Germany (318), Latvia (309).

By the beginning of 2021, all these countries, except Germany, reduced their quantitative presence in the Belarusian market. It should be borne in mind that the interest of Cyprus is associated primarily not with the island capital, but with businesses that originate from the territory of the former USSR - Russia, Ukraine, and Belarus, etc.

Due to the difficult operating environment in the CIS, it is easier for entrepreneurs to structure capital and transactions through management companies with jurisdiction in Cyprus.

Investments from Western countries should also be viewed with great caution. In the summer of 2019, British Ambassador Fiona Gibb said that most British investments in Belarus are "in fact Russian" and that these are "companies from Russia that have an office in London."

Formally, businesses of the United Kingdom invested in 189 companies in Belarus, businesses from the United States - in 190. What happens in reality is known only to the ambassadors of the respective states and industry experts.

In the sectoral context, by the beginning of 2021, most of the companies with foreign investments were in industry (1245), trade (2009), real estate operations (642), and the information and communications sector (638).