Transport Policy Challenges for Belarus in 2020

CASE Belarus team has discovered what are the key challenges in transport policy for Belarus today to spur the export of transport services from Belarus.  


Under different scenarios, we have calculated the export growth potential. For basic scenario, having growth rate of the trucks, the staff of drivers, the operational efficiency of the carrier companies, as well as maintaining the dynamics of freight rates unchanged from 2015-2019, we conclude that the sector will reach an export figure of USD 2.8 billion by 2025.

The optimistic scenario assumes, in addition to maintaining the growth rate of the sector from 2015-2019, also Russia’s permission passing cabotage. This will allow over the next 6 years to receive a total of USD 0.5 billion more comparing to basic scenario. By 2025, export of road freight transport services could be USD 2.9 billion.

The last scenario of an “ideal world” assumes a situation where: i) entry barriers to foreign markets (both to the East and to the West) are gradually withdrawn, ii) full liberalisation of transport within the EurAsian Economic Union takes place, including trips to/from third countries, iii) the cost of credit  and vehicles gradually decreases. As a result, Belarus may become an attractive country for carriers and forwarders and all of 50 thousand drivers currently employed in other countries may return back to Belarus. Under ideal world scenario, by 2021 it would have been possible to reach USD 2.7 billion of export, and by 2025 the freight export would come close to the value of USD 6 billion.


What transport policy changes are needed? In short, those are:

1. To pursue a tougher policy to protect the interests of Belarusian carriers within the EurAsian Economic Union.
2. To focus the efforts of foreign affairs agencies and diplomatic missions on increasing the number of permits issued by EU countries, especially in Central and Eastern Europe
3. To stimulate the renewal of trucks  by cancelling a utilisation fee for trucks of Euro-5 standard and launching state subsidies for leasing schemes
4. To run a feasibility study of concluding bilateral agreements on mutual VAT refunds (primarily with Russia and Poland)
5. To introduce VAT on road tolls in Belarus
6. To run studies on transport development incentive policies, such as, for example, the creation of special economic zones, preferential tax treatment for exporters, the provision of export grants, etc.
7. To simplify border procedures: reduce the waiting time at the border, passing customs procedures, increasing the turnover of border points


To read the full policy-paper with findings and policy proposals (in Russian), please click here.


The policy paper is prepared under financial support of the British Embassy in Minsk

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