EEC Minister on the situation on the food market, import substitution, microelectronics and aviation

On June 21, the Prime Ministers of the countries of the Eurasian Economic Union will hold a meeting of the Eurasian Intergovernmental Council in MINSK in person. One of the central topics of discussion will be the issues of import substitution in priority and high-tech industries. Artak Kamalyan, Member of the Board (Minister) for Industry and Agro-Industrial Complex of the Eurasian Economic Commission, spoke to a BelTA correspondent about the role Belarus plays in this process in the Eurasian Economic Union on the eve of the meeting of the five heads of government. However, we started our conversation with a topic that, due to sanctions pressure and turbulence in world markets, worries many: will the EAEU countries have enough food.

- Artak Kadzhikovich, the topic of food security is more relevant today than ever: many countries, including those in the West, have felt for themselves what a shortage of certain foodstuffs means. Sometimes there are fears that the EAEU countries may also face this. How self-sufficient are we today and what steps are being taken to mitigate possible food security problems?

- Today, in the countries of the Eurasian Economic Union, the positive dynamics of the development of the agro-industrial complex continues. In the first quarter, agricultural production in the EAEU as a whole increased by 1.6%.

Our states, through their own production, fully cover domestic needs in grain, pork, vegetables and potatoes, vegetable oils, SUGAR and eggs. There is only a lack of fruits and berries. The level of self-sufficiency in the main types of agricultural products and food reaches 93%.

If we consider this issue in the context of countries, then the highest self-sufficiency rates have been achieved in Belarus (94%) and RUSSIA (90%). This is followed by Kazakhstan (83%) and Kyrgyzstan (81%). In Armenia, the level of self-sufficiency is 73%.

Our states are taking joint steps to strengthen food security. In particular, to ensure the balance of the common market, short-term union forecast balances of supply and demand for the main types of agricultural products and foodstuffs are formed on an annual basis. In addition, general principles and approaches to ensure food security have been approved. This is an important step towards the formation of real mechanisms for stabilizing the food market, ensuring guaranteed mutual supplies, as well as removing existing barriers and restrictions on the common Eurasian agricultural market.

To respond to emerging risks, the Eurasian Economic Commission has a working group on the prompt supply of agricultural goods. This is necessary to ensure effective interaction between the countries of the "five" in the event of force majeure situations.

Speaking about food security, along with economic, it is also worth noting the importance of ensuring the physical availability of food for the population. To this end, the EEC, together with the member countries, is currently working on the issue of forming the Eurasian commodity distribution network. In addition to reducing transaction costs, the implementation of the project will eliminate the opacity of the logistics chain, increase the amount of storage capacity, create a unified system for making decisions and managing inventory flows.

- What role does Belarus play in ensuring the Union's food security? What products does our country mainly supply to the markets of the EAEU states?

- In the total volume of mutual trade in food products, the share of the Republic of Belarus is about 43%.

About 93% of Belarusian supplies go to the Russian Federation, the remaining 7% are exported to Kazakhstan, Kyrgyzstan and Armenia. The main commodity items are cheeses and cottage cheese, butter, condensed and dry MILK and cream, non-condensed milk and cream, fermented milk products, beef, poultry MEAT, prepared or canned fish, rapeseed oil, the share of which in 2021 was about 64% of the total volume in monetary terms.

- Deepening industrial cooperation, active work in EXPORT markets through the joint promotion of manufactured goods and much more are important areas in the EAEU. Which enterprises of Belarus are already in the chain of industrial cooperation of the EAEU? And which sectors of our country are the most active and successful in this process?

- Belarus occupies its stable niche in the integration architecture of the Eurasian Economic Union. Belarusian trade is oriented mainly towards the EAEU states. Thus, Belarus is in second place after Russia in terms of trade in the union.

In 2021, positive dynamics of cooperative cooperation was noted in the framework of mutual trade of the Member States with the participation of Belarus. For example, in comparison with 2019, supplies of finished metal products increased by 38.1%, metals - by 35.4%, components for vehicles - by 5%, machinery and equipment - by 10%, rubber and polymer products - by 5%. Also, supplies of chemical products to the EAEU countries, mainly mineral fertilizers, have been developed. By the way, these industries have not only cooperation, but also export potential.

We see the deepening of industrial cooperation in the most demanded segments and niches as the main driver for the further development of partnership between our countries. The EAEU member countries are actively working in this direction, and there are already a number of successful examples of such activities.

One of the priority sectors of the EAEU is agricultural engineering. Manufacturers of agricultural machinery are actively developing assembly plants in the Union countries. For example, there is a cooperative cooperation between the Belarusian JSC "Gomselmash" and the Kazakh JSC "AgromashHolding", on the site of which combine harvesters of the Belarusian "PALESSE" line are produced.

By deepening the localization of the existing production of tractors from machine kits of the Minsk Tractor Plant OJSC at the site of the Cherepovets Foundry and Mechanical Plant OJSC, with the support of the block for industry and agro-industrial complex of the EEC, a project was launched to organize the production of a "union agricultural tractor".

In continuation of this work, under the coordination of the EEC, an agreement was reached between the St. Petersburg Tractor Plant (JSC "PTZ"), the Minsk Tractor Plant (JSC "MTZ") and OJSC "Gomselmash" on the development of a long-term, effective and mutually beneficial partnership aimed at implementing projects in the field of production machinery and equipment for agriculture, as well as in the forestry and municipal industries. By the way, other interested market participants can join this work at any time.

In addition, we keep a close eye on the latest trends in the automation of agricultural machines. In this regard, experts from the EEC Industrial Policy Department held a series of consultations in order to combine the scientific and production potential of the Union countries, which is necessary to create autonomous, unmanned agricultural machinery with the participation of EAEU enterprises. It is gratifying to state that the first important result of this work has already been achieved: agreements of intent have been signed between the Minsk Tractor Plant and Gomselmash OJSC with the Research and Production Association of Automation named after Academician N.A. Semikhatov. The parties agreed to develop mutually beneficial cooperation in the development of the production of autonomous agricultural machinery.

It should also be noted that within the framework of cooperative cooperation OJSC "BELAZ" purchases from Russian enterprises of ferrotitanium, the Minsk Motor Plant - aluminum alloys and products, OJSC "Mogilevliftmash" - primary aluminum.

In the field of special machine building, a joint project is being implemented for the production of Belarusian logging equipment in Karelia, including wheeled forwarders, wheeled harvesters and timber loaders, as well as units used in the construction of this equipment (tandem axles), at the facilities of the Onega Tractor Plant.

Another promising area for cooperative cooperation in the EAEU is unmanned technology. BELAZ became a pioneer in this area. BELAZ's partner is the Russian OJSC "VIST Group". The two enterprises are now jointly implementing research and experimental programs on unmanned vehicles.

We consider interstate programs and projects to be an important tool for the development of industrial cooperation in the EAEU. Thus, a program is currently being developed to improve the efficiency and reliability of industrial and distributed energy facilities, a project on supercomputers. Earlier, an interstate program in the field of remote sensing of the Earth was adopted.

Belarusian industrial enterprises take an active part in all this work. For example, in the interstate program on space, Belarusian companies are engaged in the development and production of optoelectronic survey equipment for spacecraft for remote sensing of the Earth.

As for the further deepening of cooperation and import substitution in the EAEU, such areas of work are contained in the "Map of industrialization of the EAEU". This information resource has accumulated information on about 200 major ongoing and planned investment and cooperation projects totaling $195 billion from all countries of the Union. We are talking about aircraft and shipbuilding, automotive and light industry, pharmaceutical industry, metallurgy, building materials industry, production of road construction, special and municipal equipment, agricultural and forestry engineering, machine tool, chemical and pulp and paper industries, power engineering, cable and electrical industry.

- Recently President of Belarus ALEXANDER LUKASHENKO held a meeting on the development of microelectronics. What is the current state of affairs in the microelectronics industry in the Eurasian Economic Union?

- Several dozens of companies engaged in the production and development of microelectronic products are currently operating in the EAEU. The production and research centers of these companies are mainly located in Russia and Belarus.

It is important to note here that global economic and political processes have made their own adjustments, including to established logistics ties, which, in turn, affected the production of microelectronics in the EAEU. In this regard, many enterprises are forced to reduce production or diversify output through the introduction of more archaic technological processes.

- Will the EAEU market be able to get away from import dependence in the supply of microelectronic products?

- I think that in the short term, the EAEU states will most likely not be able to get rid of import dependence and achieve full import substitution in this area, since this transition will require enormous financial and scientific investments.

At the same time, the firmness of the positions of the leaders of the EAEU countries suggests that our countries will make every effort to achieve both civil and military security through the introduction of new production facilities, as well as the development and production of the necessary microelectronic components.

Today, a number of programs to support developers and manufacturers of computing components are already operating within the union, activities have been organized within the framework of the SEZ to support research activities in the field of microelectronics and complex computer technology.

I believe that with the coordinated approaches of our manufacturers, as well as the development of the necessary incentive measures, in the long term, the microelectronic industry of the EAEU countries will take its place in the top world manufacturers.

- How do you assess the potential of Belarusian enterprises in the field of microelectronics? And the activities of which enterprises in this industry do you single out?

- Belarus is the second largest producer of microelectronics products in the EAEU. It is gratifying that most of the Belarusian enterprises are involved in various cooperation projects with industrial and scientific-technical associations of Russia, and a significant share of microelectronics products manufactured in Belarus is designed for the intra-union market. And, by the way, it also plays an important role in the military-industrial complex of the EAEU.

The largest manufacturing enterprise in Belarus is NPO Integral, whose enterprises are also located in Russia. Integral is the largest manufacturer of integrated circuits and semiconductor devices in Central and Eastern Europe. A full cycle of development and production of integrated circuits and semiconductor devices is organized here: from silicon ingots to finished products.

It is also worth noting the holding JSC "Planar", which is one of the largest enterprises in the EAEU for the production of equipment for the formation of topological patterns on photomasks and semiconductor wafers. This equipment is the heart of the production facilities of any enterprise producing semiconductors.

Another large industrial association of Belarus, whose work should also be noted, is the Horizont holding. Currently, the company focuses on innovative products. It develops the production of automotive electronics (on-board control systems and monitoring and indication systems), avionics (on-board indication and control systems for aircraft), information systems (integrated solutions for a smart city).

- One of the most import-dependent industries in the EAEU is aircraft manufacturing. What is being done here for import substitution and what role does Belarus play in this process?

- Work to intensify cooperation in the field of civil aircraft manufacturing is being carried out on the instructions of the heads of state, which they gave at the Supreme Eurasian Economic Council in December 2020.

In 2021, we developed a roadmap for expanding industrial cooperation in the field of civil aircraft manufacturing in the EAEU states for 2022-2023, this document was approved by the prime ministers of our countries.

In the first quarter of this year, we updated analytical materials on the state of the industry and the needs of the EAEU member countries in aircraft in the near future, then, together with the authorized bodies and aircraft manufacturers, we determined the lists of aircraft components for which there is a critical import dependence. Currently, opportunities are being sought to organize import substitution by the union's enterprises. This is a good basis for the formation of new cooperation chains in the civil aircraft industry.

A concrete example of the effectiveness of the work being done - today the parties are working on an impressive list of components under the import substitution program for the MS-21 aircraft, which was provided by the Irkut Corporation (UAC) in February this year.

Belarus shows great interest in the development of the Eurasian aircraft industry. It can make a significant contribution, first of all, with its personnel - there are designers, aerodynamicists and programmers in Belarus.

Interested Belarusian enterprises - the 558th Aircraft Repair Plant, the Orsha Plant and others - are actively involved in this work. As far as we know, there are already positions on which it is possible to connect Belarusian manufacturers of aircraft components.

It is also worth emphasizing the high technical equipment of Belarusian enterprises. In particular, the 558th aircraft repair plant in Baranovichi has unique equipment for testing the operation of aircraft in various conditions. This company is successfully cooperating with the Russian scientific and technical complex. G.M. Beriev for the supply of components for hydraulic cylinders used in the production of Be-200ChS aircraft.

Edward PIVOVAR,

BELTA.