The Belarus-China Park Great Stone is one of the leading and most large-scale ongoing projects in the country. However, many people still have questions about the purpose and peculiarities of the industrial complex that’s being constructed in close proximity to Minsk.
Here are the essential details the project explained in simple and clear Q&As.
1. What is the Great Stone?
In brief, it is Belarus’ attempt to apply a new approach to attract future investment.
Besides, it is the largest industrial park across Europe and the biggest Chinese project abroad as estimated by China’s Ministry of Commerce.
The idea to create a new platform to promote high-tech industries popped up in 2010. It was grounded on China’s successful experience in creating industrial parks, such as the Singapore-China industrial park in Suzhou, now a six-million city with a fast-growing economy.
The park is to be completed by 2030. The first stage of the construction is in its final stage – roads and engineering infrastructure are ready, and factory buildings are growing on the territory of over 800 hectares. The second stage of the construction is to kick off on other 3500 hectares. Overall, the park will span on the area of 112 square kilometers, which is comparable to the size of Mogilev and way bigger than that of Paris or Copenhagen.
Once the building is complete, a modern international city will appear just outside Minsk next to the national airport. It will be a city with high-tech industries, R&D centers, and accommodation facilities.
2. So the Chinese are constructing production facilities and housing for themselves in Belarus?
No, it’s far from being true.
Belarusians rely on China’s experience in the creation of industrial parks during the construction of Great Stone. In particular, they apply similar management, spatial planning, and functional zoning approaches, and design construction stages of the park development in a similar way.
The construction itself is only partially run by Chinese companies. The general contractor for the infrastructure is the Chinese corporation CAMCE, yet 60-65% of the construction works in Great Stone is carried out by Belarusian companies, mainly from Minsk and Minsk region.
Therefore, the investment into the project – over 420 million dollars – form the revenue of primarily Belarusian companies. Besides the construction companies, the development of the park has already benefited local manufacturers of building materials and related services, and, of course, Belarusian employees of the relevant businesses.
The belief that the park will consist of only Chinese companies is fundamentally wrong. Great Stone is an international project. Companies from different countries become the park’s residents on equal terms. At present Great Stone has residents with the capital from Belarus, China, the USA, Austria, Germany, Israel, and Lithuania. There are companies with 100% capital from one country, but many are joint projects.
3. Why build a big industrial city?
As the experience in the development of free economic zones and small industrial zones shows, one of the first things investors seek out and hunt for are qualified employees. Employees, in turn, seek out for the availability of accommodation and commuting facilities, schools where their kids would go to and medical centers their families would be treated at.
For this reason, Great Stone is already developing residential and social infrastructure and building a trade area. Construction of the first apartment building was launched last year. The apartment building, that is likely to be completed this year, will house a post office, police unit, pharmacy on its ground floor. A draft of the construction of a polyclinic was designed as well.
On top of that, all park residents will be located close to each other and able to cooperate, which makes it easy to share experience, find the best suppliers of goods or services even during the construction phase and later in production.
4. So, will the industrial park be a second Hi-Tech Park?
Hi-Tech Park Belarus (HTP) and industrial park Great Stone are similar in terms of some types of benefits. However, they are applied differently.
The benefits of HTP can be used by software developers, but don’t apply to manufacturers of real goods. A hardware company cannot become the HTP’s resident. The benefits of the Great Stone, on the contrary, work for manufacturers and cannot be extended on software makers.
Let’s use the production of robotics, ACS or smart-system to explain the difference between HTP and industrial park. It includes two components – the creation of software and the creation of physical hardware (sensors, control panels, drive systems, and other parts).
If a company only develops software, but not robotics itself, then HTP is the best choice. If a company produces prototypes or has started the industrial production of robots, then Great Stone is the best option to maximize the benefits.
The industrial park has the engineering and transport infrastructure ready. Companies can buy or rent land that already has facilities such as roads, gas, water, electricity, fiber optics. Companies can also rent industrial spaces for a quick start of investment projects.
Minsk with its high research and technical potential and human resources is located nearby. The international highways M1 (Moscow – Berlin) and M4, the National Airport Minsk, railway lines are in close proximity to the park.
Great Stone has its own logistics system with warehouses and customs. The park provides benefits and preferences for tax payments, customs administration, foreign exchange, labor, construction, land regulations.
One of the major advantages of the industrial park is the ‘one station’ principle. Residents can contact the Administration to resolve any issues, for example, register a company, obtain various permits and so on.
5. I understand the benefits for the resident companies. And for Belarus?
New production lines. Their number is estimated to reach 70 by 2020. All companies are export-oriented, although this is not a prerequisite requirement for the residents.
Only deep tech and high-tech companies can become residents of Great Stone. Not only is it the country’s prestige, but also higher wages for employees and self-fulfillment in global corporations.
One more benefit is tax revenues. Great Stone residents get the benefits that encourage them to invest in production. However, these investments are the companies’ own revenue and return to the budget through taxes. Nearly $40 million has so far been contributed to the state budget through such indirect taxes.
6. Are there any benefits for ordinary folks?
Certainly. Only the first stage of development of Great Stone will have hired 10,000 to 12,000 employees. Nearly all jobs will offer higher wages compared to the country’s average.
Even now there is a demand for related services in the park. There are cafes and restaurants, shops, insurance bureaus, hairdresser’s, dry cleaning, transportation, and shipping companies opening there. As the social infrastructure develops further it will require healthcare and education staff.
It all contributes to new jobs with competitive wages. Overall, the park will employ around 150,000-200,000 people.
7. How many companies are already registered as Great Stone residents?
At present 44 companies have become the park’s residents. Of them, 33 are engaged in production and 11 are R&D companies.
They are, for instance, manufacturers of special robotics, unmanned vehicles, laser equipment, industrial systems of ventilation and air conditioning, solar panels, LED-products, energy-efficient glass for vehicles, motor, medical devices and many more.
8. So, if I own a company, can it become a resident and get all the benefits?
Not exactly. Potential residents have to meet two basic requirements that are issued by the President’s decrees and may change with the development of the park.
The first requirement is the compliance of the project with priority areas of the park’s activities. The current list includes the production and R&D in mechanical engineering, electronics and telecommunications, fine chemistry, biopharmaceuticals, new materials, big data, e-commerce, integrated logistics, and social and cultural facilities.
Companies operating in traditional industries such as food production, wood processing, consumer goods manufacturing cannot be the park’s residents.
The second requirement is the company’s value. For the production opportunities, the volume of investment must make at least 5 million U.S. dollars or 0.5 million U.S. dollars on condition of its investment in the next three years. R&D companies must have at least 0.5 million U.S. dollars of investment.
9. Good, what do I need to place my production company there?
Registering as the resident of Great Stone takes several steps.
First, you create a legal entity based in Great Stone, or if the legal entity had already been created, change the address to Great Stone. It is allowed to indicate the address without reference to specific streets and buildings.
Second, you prepare and submit a simplified project basis to the Administration for further consideration. For this, there is a sample form.
Third, you make two agreements:
- with the administration of the park stating all the main stages of the project and obligations on investment;
- with the company on the development of the industrial park, which provides land plots or premises for the project.
These documents are usually prepared simultaneously. After signing the contract with the Park Administration a company becomes its resident and receives a certificate.
10. All looks good on paper. But isn’t any production an extra burden on the environment?
Great Stone is an environmentally friendly project. For instance, the permissible size of the sanitary protection zone, i.e. the distance from one industrial object to the next one, in the industrial area is 50, 100 and 300 m. This means that no harmful production can be planned in Great Stone.
In fact, all of the projects in the park are being built following even more stringent requirements. They are designed so that the sanitary protection zone is minimal, and in the best case does not exceed the borders of the given section of the construction.
The designers initially take more measures to protect the environment. On the one hand, this makes the construction more expensive. On the other hand, it allows the allocation of different types of production close to each other, without the threat to the safety and purity of the product and safe working conditions for employees in the neighboring enterprises.
Besides, all the entities are supplied with only pure water from underground springs. Not only is it important for residents, but also for many types of production – optics, pharmaceuticals, electronics, and others. Used water is purified to the extent suitable for fish-household consumption before being discharged into the river Usha.
The Park annually confirms its environmental safety. In 2018 the Park confirmed the EMAS certificate (Eco-Management and Audit Scheme) issued to it in 2017. This document is issued by the Independent European Organization following the results of a comprehensive expert examination of all the works in the Park throughout the year.