According to Sergey Mashonsky, Senior Partner at Arzinger Law Offices in Belarus, his country is struggling to find economic balance amid the pandemic and the international sanctions. He reports that certain sectors, such as forestry, are doing well, while some others, such as the food packaging industry, have been negatively impacted in recent times.
“As Belarus was one of the two countries in Europe that did not introduce air travel restrictions during the COVID-19 pandemic, tourism did not suffer too much,” Mashonsky says. “In fact, the sector seized the opportunity, as some tourists didn’t have where else to go but to Belarus,” he adds. In addition, Mashonsky notes that there has been a high demand for Belarusian lumber and that, as a result, forestry is booming. “The market prices of lumber and other forest materials, like pulp, are quite high and Belarus is rich in forests,” he explains. Furthermore, Belarusian wood-processing plants have been manufacturing and exporting wood panels for eco-houses to the Baltics, Scandinavia, China, Germany, and elsewhere at a faster pace than before.
On the other hand, Mashonsky says, certain sectors have recently had a rough patch. “In February 2021, many chemical plants in Texas were shut down due to a power loss, which has disrupted the global supply of plastics and has ramped up the prices of food packaging,” he explains and adds that the food and beverage industry in Belarus suffered as a result. In addition, Mashonsky reports the IT sector, mostly based in Minsk’s high-tech park, has been impacted by recent tax changes. “The general income tax for the residents of the high-tech park was raised from 9 to 13% and tech companies could either renegotiate their employees’ salary to factor in the increase or pay the tax difference at the company’s cost,” he explains.
Furthermore, Mashonsky reports that the Belarusian parliament was working very hard on new laws. “Amendments were made to the Civil and Administrative codes,” he says. Mashonsky also notes that the reform on personal data is underway and that the first-ever law regulating it will enter into force in four months. “Prior to this law, personal data was regulated by just one article,” he says and adds that, although this law is not as strict as the GDPR, it will put in place mechanisms to properly handle personal information. In Corporate Law, according to Mashonsky, the option for non-repayable contributions was introduced. “This option allows shareholders to finance their company’s operations, without that loan affecting the share capital,” he explains.