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Interview of the Adviser to the Minister of industry and Agroindustrial Complex of the EEC Vladimir Maltsev to the newspaper "Soyuznoe Veche": "We will take MAZ and KAMAZ to a whole new level”

Interview of the Adviser to the Minister of industry and Agroindustrial Complex of the EEC Vladimir Maltsev to the newspaper "Soyuznoe Veche": "We will take MAZ and KAMAZ to a whole new level”

11/16/2016

In Moscow, the Board of the Ministry of Industry of Belarus and the Ministry of Industry and Trade of the Russian Federation held a joint session to discuss the development of the machine tool industry. The Adviser to the Minister in charge of Industry and the Agroindustrial Complex of the EECspoke about the outcomes of the session.

-What were the key topics raised at the meeting?

- The topical issues of industrial cooperation within the Eurasian Union (the “five”) and the application of the best practices of the "two", i.e. the Union State of Belarus and Russia were discussed. The central theme was the establishment of the Engineering Centre of the Machine Tool Industry. In 2015, the decision was made to establish it for all EAEU countries. The parties confirmed their interest in this. They see that it can contribute to technology transfer, the creation of new assembly plants, and resolution of the issues of import substitution. 

- What are you starting with?

- We will analyse all production on the territory of the EAEU. We will look at which machines and parts are lacking and will propose joint production projects that include potential foreign investment to the heads of our governments. Subsequently, we will introduce market protection measures, which do not contradict WTO norms. 

A similar centre was previously created for the "two". Now we can advance on that idea. I think we will be able to realise this idea between 2017 and 2019. The task was set for us by the heads of Government. The location of the centre and its funding sources are currently being discussed. All parties are interested in having a competence centre of this kind in their country. 

- Recently, there was a plan to create something like a transnational corporation on the basis of MAZ and KAMAZ. How are things coming on?

- This is an interesting situation. To be frank, MAZ and KAMAZ are competitors on our common market. On the one hand, this is good, because their rivalry constantly increases the quality of their products and, ultimately, the consumer wins. On the other hand, this competition saps a lot of strength. Protectionist policies put in place by the countries run contrary to the interests of the Eurasian Economic Union. It is often the case that cooperative projects ordered from above stall because business does not see the benefits. The enterprises have already divided the market, have even begun to compile joint balance sheets, so as not to interfere with each other. They have no desire to unite under one concern. 

Is there a solution to this situation?

-We respect the position of business. We are willing to propose a compromise. If our major players can produce competitive products and there is a surplus, then we can enter the markets of third countries in unison and conquer them together. This is where those agreements on free trade areas that we have signed or are soon to sign come into play. About forty countries have expressed their desire to start negotiations.

- Does the EEC study the best practices of Russia and Belarus’ joint Union’s programs? Could such a mechanism work in the EAEU?

- Of course. We are currently preparing provisions on the financing of joint Eurasian projects. This is provided for by the basic article of the Treaty on the EAEU. We expect to complete the work in 2017. 
One of the support mechanisms will be provided by the Eurasian Development Bank. There is an agreement at the level of Prime Ministers that we, together with the Bank, will develop and adopt a system of financing common programs. We are ready to consider subsidising the interest rate of the Bank in order to increase the attractiveness of projects. 

- Won’t the crisis cause problems?

-There is an economic downturn. But in any case, the Bank will not finance clearly unprofitable projects regardless of whether there is a crisis out there or not. Serious specialists work there and they need to be presented with good, viable projects, and then there will be no problems with financing.