Meeting to discuss Mogilev Oblast development

Belarusian President Aleksandr Lukashenko has convened a meeting to discuss specific issues regarding the development of Mogilev Oblast on 7 July.

One of the topics on the agenda was the future of two holding companies under the President Property Management Directorate: Kupalovskoye and the Agro-Industrial Holding which together comprise 3 industrial enterprises and 11 agricultural enterprises.

"The overall picture for these companies is positive. Considerable investments are being channeled into the enterprises. Over Br200 million has been invested over the past year and a half. This covers machinery, fertilizers, seeds, and leasing," the head of state emphasized. "Last year, revenue went up by 17%, profit by a third, and exports by 20, milk yield per cow is approaching 7,500 kg. These are good figures, but they are not indicators of efficiency: these are not profit, not profitability, not substantial funds in the accounts."

At the same time, there are issues with the performance of specific enterprises, where production of certain types of goods remains at 93-98%. "I want to say that the average picture is normal, but at certain enterprises it is sadly different," the President noted.

The head of state outlined a number of issues that raise his concern and relate to specific enterprises within the holding company. In particular, cattle mortality in Kupalovskoye has increased by 25%. In this regard, Aleksandr Lukashenko recalled that Head of the Belarus President Property Management Directorate Yuri Nazarov had promised to implement an anti-crisis business plan and bring Kupalovskoye to perfect order. "In fact, there is no discipline in this showcase holding company: equipment has not been repaired, forage harvesting is carried out without proper technology, machinery is not ready for the harvest campaign, and sometimes even livestock is left without water," the head of state stated.

The Belarusian leader also drew attention to the district agro-service center in Shklov, which is also part of Kupalovskoye Holding Company and whose performance raises certain concerns. Complaints have been made that the organization repairs only simple machinery such as trailers and seeders but not powerful tractors. "I don't need this kind of window dressing. It is expected to repair the machines that local workshops are unable to handle," he emphasized.

The President noted that local authorities have no objection to taking these enterprises back under their jurisdiction. The fact is that local leaders have a better understanding of the needs of the district and can make managerial decisions more quickly and adjust the operational strategy of the organizations. "I see no major problem in transferring these farms to communal ownership," Aleksandr Lukashenko said.

He suggested outlining specific steps needed for the further development of the holding companies and identifying the issues that require resolution at the level of the head of state.

Another topic on the agenda was the proposals to enlarge Dribin District by incorporating the lands of agricultural organizations from the Mogilev, Gorki, and Chausy districts. "At one time, a similar question was raised, and I answered it about 25 years ago: Dribin District must remain. But we need to consider what it should look like. It should correspond to the average size of districts in our country. That was the starting point," Aleksandr Lukashenko emphasized. "The Government, the governor, the President's authorized representative in Mogilev Oblast, together with interested parties, were tasked with giving this serious thought and submitting proposals on the matter. The fact that this district needs to be enlarged and that the chairman of the district executive committee and his colleagues need to be given a proper workload is beyond question."

The head of state noted that some time ago he had set the task of creating the necessary infrastructure in Dribin District and brining it on par with infrastructure in other district centers. "It has been created. The infrastructure in the district center is no worse than elsewhere. Of course, this is not Gorki District where the academy [Belarusian State Agricultural Academy] adds a certain charm, but it is a very decent and average district. In terms of size, however, it is small," he added.

Aleksandr Lukashenko outlined the questions that need to be answered before making a decision on Dribin District. "What do people in all the mentioned districts think about this? People's opinions are very important, but only after we explain to them what we are aiming for. Have the possible consequences and subsequent steps been thoroughly examined? How much will it cost the budget and the citizens? I assumed it would cost nothing. But if we need to support certain farms, we will provide support. Most importantly: will there be a positive social and economic effect?" he inquired.

The meeting with the head of state was attended by the prime minister, the head of the Presidential Administration, the chairman of the State Control Committee, the head of the Belarus President Property Management Directorate, the minister of agriculture and food and the leadership of the region and the districts.

Head of the Belarus President Property Management Directorate Yuri Nazarov noted that financial support from the Property Management Directorate of Br200 million in investments over a year and a half played a key role in achieving positive results at Kupalovskoye and the Agro-Industrial Holding. However, according to him, the management companies of the holding companies are yet to come up with a unified production, financial, and investment policy, including centralized procurement of raw materials, materials, and components, the sale of finished products and also marketing, logistics, and other activities. Moreover, the functions of the management companies often overlap with those of the district executive committees' agricultural departments (particularly in terms of technology control and the collection of operational and reporting information).

"Accordingly, it is quite logical that, for the purpose of creating the most effective and efficient management structure for these enterprises, it has been proposed to transfer, free of charge, the shares of the organizations belonging to the holding companies from national to communal ownership," Yuri Nazarov said as he presented the proposal.

In this regard, Aleksandr Lukashenko noted that he had repeatedly pointed out to the expediency of exactly such a solution in the current situation with these agro-holding companies.

"I spent about two months trying to convince Mr Nazarov. He kept saying: 'We've put money into it, it's mine.' A real kulak. I call him my kulak. But I told him, what difference does it make? You are a senior official, the President's representative. To me, the whole country and all enterprises are the same. Whether it's yours or not. Those on the ground know local things better. So you see, I finally convinced him. He now admits that the farms will be managed by the district executive committee chairman, as it should be," the head of state said.

The President explained that the decision to consolidate these enterprises into agro-holding companies had originally been made in order to secure a raw material base for the new modern milk processing plant in Shklov, which, on the President's instructions, is to be completed by 7 November of this year.

The new facility has a capacity of 300 tonnes of milk per day. Such volumes must be supplied primarily by the major local agricultural producers such as Kupalovskoye and Alexandriyskoye, which are located on the best lands in the district and occupy a significant portion of it.

Alexandriyskoye and the dairy plant will for now remain under the Belarus Property Management Directorate, which will now have to focus less on crop farming and dairy cattle breeding and more on processing.

As for Kupalovskoye, the original idea was to organize it along the lines of the Dzerzhinsky agrokombinat. "It seemed like it could have been done. But instead, they worked in a slipshod manner, neither here nor there," the President said as he characterized the work that had been done. There were also, he said, personnel mistakes. Instead of bringing in a few capable managers from Dzerzhinsky and placing them in leadership positions at Kupalovskoye, where they could have scaled up their successful experience, other people were appointed to those roles.

"In coordination with the governor and the district executive committee chairman, this work should have been properly organized. But it has not been. So what are we to do?" the head of state asked a reasonable question. "We cannot afford to lose these agricultural organizations, because they are situated on the best land in the country. Gorki, Shklov, Belynichi, Krugloye and Mogilev districts, the entire eastern strip, is the finest farmland in the east. It is hardly inferior even to Grodno Oblast. But Mogilev Oblast has always been a mess since Soviet times. Anatoly Isachenko [Governor of Mogilev Oblast] has not defeated it, as Berlin was defeated in 1945. It is still there. Everyone there got their own agenda. Sergei Bartosh has followed this suit since he was appointed Chairman of the Shklov District Executive Committee."

The President also emphasized that the farms belonging to the agro-holding companies under the Property Management Directorate have expressed a desire to switch to autonomous operation. "Can they work independently? Then let them work. There is nothing wrong with them not being part of the holding company. Since it did not work out, let them operate on their own. What is required of them? To deliver milk to Shklov for the new dairy plant; meat - to Mogilev for the meat processing plant; flax [these are flax-growing farms] to the modernized linen mill in Shklov," the head of state stressed.