Belarus: According to Volma's chairman of the board of directors, Yuri Goncharov, a contract with Germany's Grenzebach for the supply of modernisation equipment for the Belgips plant in Minsk has been concluded. The plant will be operational by the middle of 2015.
Under presidential decree No.34, which was signed on 16 January 2014, Volma was required to invest Euro43m to modernise the Belgips plant by 1 July 2018, including Euro24.7m by 30 June 2016. Within the funding, Volma had to transfer at least Euro2.5m to Belgips. "We will meet the investment project deadline, " Goncharov noted.
According to local media, Belgips' business is being threatened by multiple factors. The supply volumes to Russia haven't changed, but the product prices have fallen by 20 - 25%. There's also a negative effect on Belgips' position by the Polish companies that, according to Goncharov, offer their products on the Belarusian market at much cheaper prices than their domestic ones. There are also challenges regarding the procurement of raw materials.
In response, Volma plans to improve the quality of products through modernisation of the operating facilities. It will also decrease its prices. However, according to Goncharov, prices cannot get much lower. Volma also plans to improve its raw materials supply chain via imports. Goncharov expects to see Belgips in profit in 2015.
