Ability to use a calculator, common sense and a good memory helps to perceive reality in the right way. For example, with respect to the scope of the Belarusian defence industry’s presence in the Russian market.
Strange figures. Official data of State Military Industry Committee (Goskomvoenprom) of Belarus suggests that “… the share of deliveries from our country in the state defence order of Russia is 15%, and it is mainly high-tech products”. This is an impressive achievement. So impressive, that all employees of the Belarusian defence industry, from the factory cleaners to the heads of enterprises should be immediately awarded the Hero of Belarus. Let’s explain why.
Russian state program of armaments for 2011-2020 provides for the allocation of about RUR 20 trillion for the purchase of arms and equipment for the Russian Armed Forces. Which was about USD 680 billion at the time of the approval of the program. That is Belarus’ share in this amount could exceed USD 100 billion or USD 10 billion a year. However, there was a war with Ukraine, the collapse of the oil market and a couple of other unpleasant things for the Russian economy. As a result, the dollar exchange rate has grown.
In 2015 the volume of state defence order of Russia amounted to RUR 1.8 trillion (source) or about USD 30 billion (source). It could be expected that the Belarusian supplies account for USD 4.5 billion. Approximately a similar order amount is scheduled for 2016 year. Of course, 4.5 billion is not 10, but the results are more than impressive: it is comparable with weapons exports from Germany and more than from the UK and Israel. The truth, however, is that both USD 10 billion and USD 4.5 billion for the exports by Belarusian defence industry to Russia can be only dreams.
How it really is. Goskomvoenprom doesn’t like to state the actual production volumes. The recent reliable data is the following: for January-August 2015 industrial enterprises of Goskomvoenprom produced goods for the amount of BYR 3 571.1 billion, or more than USD 238 million. And these figures are extremely far from the mythical billions.
Not all the enterprises involved in the production of military products are subject to Goskomvoenprom. So the statistics of the agency doesn’t reflect the total production for the needs of defence. And the purchases as a part of state defence order are connected not only with military equipment and weaponry: soldiers should be fed, clothed and treated, and the vehicles need fuel and lubricants.
If we accept that the volume of Belarusian exports for the interests of the Russian defence is USD 4.5 billion a year, then we have to admit that over 40% of the total volume of the exports to Russia accounted for “… mainly high-tech products”. However, the National Statistical Committee doesn’t notice such “high-tech orientation”: the basis of our export to Russia are the products, which has little to do with advanced technology. In addition, since 2011 there is an unofficial ban on purchasing in Belarus the products, analogues of which are produced in Russia, regardless of the price and quality, for the needs of the Russian army. The only exception is made for products, directly affecting the combat capability of equipment and light industry products.
So, there are only two variants here: either there is no 15% of Belarusian exports in the Russian state defence order, or Belarus exports to Russia high-tech military cheese.
What it would mean. So, how the statements by Goskomvoenprom of Belarus about 15% participation in the state defence order Russia should be understood? The answer is the following: however you like, but not as a financial indicator. This may be a share in the nomenclature of the Russian products, which have the Belarusian components, and the percentage of Russian enterprises engaged in the implementation of the state defence order and having Belarusian subcontractors. Naturally, there are no USD 4.5 billion of annual military exports to Russia. The average level of exports of Belarusian military products to Russia doesn’t exceed 70% of the production volume. So it is doubtful that the total amount of Belarusian defence exports to Russia are significantly bigger than USD 400 million per year. Which, however, isn’t too little.
