Easing visa requirements: Belarus eyes foreign business

Easing visa requirements: Belarus eyes foreign business
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The potential easing of travel visa requirements in Belarus is likely to boost the local economy, further integrate the country within the eastern European region, and improve its global image.  

Since mid-October 2016, the Belarusian government issued several statements concerning the potential implementation of easier visa procedures for the entering the country. There is growing attention given to President Alexander Lukashenko’s potential interest in passing a presidential decree that would enable citizens of 80 countries, including EU countries, arriving to Belarus through the Minsk International Airport to remain for five days within the country without a visa.  This would be a major development boosting the country’s economy and enabling it to further integrate within the eastern and central European regions.   

A policy driven by major events

Major international events are a key driver for Belarus’ prudent opening. Talks about implementing easier visa policies kicked off in November as the country was elected in October to host the second European Games in 2019. The international sporting event will see thousands of foreigners travel to Belarus and will be preceded by substantial investments in the local infrastructure.  The government’s objective is to boost tourism ahead of the European Games and use this event as a positive door into the country.

A similar visa-free policy had already been tested in May 2014 when Belarus hosted the IIHF Ice Hockey World Championship. The event saw more than 30,000 people travelling to Belarus for touristic reasons. Local authorities assessed it as a clear success: the number of visitors was higher than the annual number of people entering Belarus on tourist visas (approximately 25,000 in 2016). The high volume of visitors, especially in Minsk, boosted the local socio-economic life.    

It is likely that the country will continue to gradually implement an easing of visa requirements, especially ahead of key international events, in a bid to test the potential long-term feasibility of such measures as well as to evaluate the economic benefits and potential security concerns.

An evolving economy

Belarus’ economy remains heavily reliant on Russian investments and has suffered from the economic crisis sparked by western sanctions on Moscow and the drop of oil prices. However, the national economy has been showing signs of vitality and evolution that may lead the country to renewed growth. The gradual opening of the country as well as the relative facility for foreign investors to do business in it has put Belarus on the radars of international investors. The easing of the visa policy would support the trend that the local economy is taking as well as provide the country with a more positive international image. The potential easing of Belarus’ visa policy in regard to EU citizens could lead to reciprocal measures from Brussels leading to a facilitation of the process needed for Belarusians to acquire a Schengen visa. Technical meetings are already planned around this topic. This development could further boost the national economic integration within the region.

It is mainly via its growing IT sector that Belarus aims at generating interest in the country. The High-Tech Park (HTP) in Minsk functions as a national hub for the development of Belarusian and international companies willing to benefit from the investment-friendly environment set-up in the IT field. This segment of the economy is bringing a much needed flow of cash in the country as well as providing more than 45,000 highly-qualified young Belarusians with jobs and salaries higher than the national average.    

Aside from the IT sector, Belarusian authorities are increasingly trying to evolve from the heavy industrial production that has so far characterized the country to foster growth via the development of Small and Medium Enterprises (SMEs). In mid-November, Economy Minister Vladimir Zinovsky stated that the government aims to raise the SME wealth creation share from the current 28% of the national GDP to 40% by 2020. This would require a reform of the national taxation structure and an improvement of the local entrepreneurs’ access to credit.

Belarus aims at developing ties

The easing of visa requirements for travel to Belarus comes against the backdrop of a wider effort by the government to improve the country’s regional and international ties. Economically Belarus is trying to position itself as a bridge linking the EU to Russia and Asia. As such, it has already opened six free trade zones some of which are used as major industrial parks by Chinese investors. Belarus is also in the process of expanding trade relations with Turkey and Brazil as the country is aiming at diversifying its international partners and further integrating within the global economic system.

Political stability as well as an overall improvement of relations with the EU and the US are also key drivers of Belarus’ regional integration.  The country is betting on its vast natural and historical sites as well as its generally safe environment to boost tourism and increase Belarus’ overall international exposure.

Categories: Economics, Europe

About Author

Riccardo Dugulin

Riccardo Dugulin is an analyst at Drum Cussac, a global business risk consultancy. He specializes in supporting international organizations and large corporations operating in emerging markets by providing them with critical risk management intelligence. His regions of expertise are the Near East, the Gulf, North Africa and Continental Europe. He previously worked as project manager for a French medical assistance company. He gained field experience in the Middle East having worked for leading think tanks in Dubai and Beirut. Riccardo holds a Master in International Affairs from the Sciences Po – Paris and a Bachelor in Middle Eastern Studies from the same university. Follow him on Twitter @RiccardoDugulin.