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About the possibility of creating a regional financial center in Belarus
Material posted: -Publication date: 21-12-2010

This article examines the potential of establishing a regional financial center in Belarus. The word "potential" is fundamental, since a lot will be determined not only by economic expediency at the regional level, but with respect to this project the main players in the Western Europe, USA and of course in Russia, which currently is the main economic partner of Belarus and which has an agreement with Belarus on establishing the Union state.

Therefore, it is further assumed that the above-mentioned political problems are resolved positively and considered only the economic opportunities and prospects of establishment of the Belarusian regional financial center.

1. A brief classification of the existing global financial centers

Traditionally, the rating of cities with financial centres is estimated by experts on a number of parameters: the presence of companies listed on global financial markets availability of business infrastructure and availability of commercial operations. This takes into account not only economic indicators. The researchers used as guiding parameters for the level of urban life, culture and language. The most important indicator, the experts considered the availability of skilled labour, which determines the rating of the city by 90%.

Compared to 2003, the number and importance of the different parameters that can affect the rating of the city as a financial centre has changed. In particular, in the current study, the indicators of living standards and the influence of the state on the private sector in the economy was more significant than in the past. Observers agree in opinion that in the next 3 years will be the most significant indicators of state control of business and of taxation of corporations and individuals.

A significant role in shaping the ranking of cities-leaders plays the cosmopolitanism and openness. Frankfurt and Tokyo, for example, received recognition mainly active in the domestic market, which was allowed a limited number of foreign companies. And new York, by contrast, is known to have business relations with foreign partners, including with the British capital.

The authors of the study to the Corporation of London decided that Moscow is not only to rankings but also to the gaining momentum of Asian cities – Shanghai and Hong Kong.

The main conclusions of the study of British experts, carried out on the basis of a survey of more than 400 financiers of the 23 companies in more than 20 countries (the report is "Corporation of London") the following.

The first two places in the ranking of leading financial centers of the world took new York and London. The third position can claim only Shanghai. Paris and Frankfurt, not to mention Moscow, in recent years, significantly behind the leaders and are considered a regional financial centres.

In our opinion, it is possible to propose the following enlarged the classification of financial centres:

  • "safe Harbor" (Zurich, Monaco, Luxembourg, Bermuda) – the money involved because of the reliability of their storage, which in combination with the relevant soft law, a healthy and mild climate and historical traditions of non-involvement in wars, stimulates rich people with a troubled past to settle in these places, increasing their financial capacity;
  • "transport node" (new York, Boston, Frankfurt, Shanghai, Hong Kong, Singapur, Dubai, Qatar, Bahrain) – this center is distributed over all; it appears that the future, despite the development of telecommunication systems, it will not lose its value, because a significant portion of financial transactions require privacy and can not be trusted for everyone to see (even in the presence of information protection is no guarantee unauthorized access to financial information), therefore, all financial operations will be concentrated around transport nodes relevant for personal communication of the parties;
  • "administrative node" (London, Paris, Tokyo, Seoul, Moscow) – this type of financial center is due to historical peculiarities of development of countries, or rather the scheme of making important financial decisions; if in the state traditions of the country to delegate all important issues to the top management level (for example, in England it was justified because of the need for centralized management of a complex system of colonies and dominions), you will develop such type of financial center.

 

2. Objective basis for the emergence of a regional financial center in Belarus

Belarus is situated on the main route between Western to Eastern Europe through its territory took place the principal movements of troops in all recent wars.

Currently from Poland and Czechoslovakia threatened the deployment of us missile defense systems (there is no reliable guarantee that the near future they will not be replaced on offensive nuclear systems placed in the same mines).

In addition, the political regime of Belarus (which the authors of this note consider positive) is understandable opposition from the USA and countries of Western Europe: the existence of a Russia-friendly state makes the General scheme of blocking Russia's logically incomplete.

But since "money likes silence", then look for long-term stable situation in the open the whole of Europe Belarus is not advisable. About the peculiarities of the climate, we are not even mentioned – mountain in Switzerland he put it mildly, are inferior.

Therefore, in our view, Belarus can not be created by the regional financial center of a type of "safe haven".

The creation of financial center type of "administrative node" is also unlikely, since Belarus is not a country self-sufficient in terms of resources, all of the resource flows (oil, gas) entering the country from Russia. Therefore, the leadership of Belarus, how effective it was, objectively will not be able to control the situation in the region at their own discretion. Moreover, the total population of this country is comparable with the number of residents in Moscow.

Thus, by process of elimination you can come to the conclusion that if in Belarus will create a financial center, it will be only the center of the type "transport hub".

Consider this possibility in more detail.

In Fig. 1. a diagram of the pipeline to transport oil from Russia to the EU.

It can be seen that if in the near future Russia has complicated relations with Ukraine (and it will inevitably happen because all political life in Ukraine is already under US control), then, considering the complicated relations of Russia with the Baltic countries, the key point of transportation of Russian oil to Western Europe will become the Belarusian town of Mazyr.

In Fig.2 is a diagram of the main routes of Russian gas supplies to the EU. Here the key point is Minsk.

But here that deserves attention. Because of the destructive position of Estonia on the laying of the gas pipeline "Nord stream" on the bottom of the Gulf of Finland and the Baltic sea, it is advisable to consider the alternative option b – the gasket of the parallel pipeline to the existing section in the direction Kursk – Mozyr – Uzhgorod. Then the Western consumers of Russian gas will be protected from the irregularity of its supplies via Ukraine. While laying the new section of highway financially will be much easier to achieve than under the Baltic sea.

 

Fig.1

 

Fig. 2

In this embodiment, the Belarusian town of Mozyr becomes a hub for transporting energy from East to West. In the future, when you create a transport corridor "East-West", the need for which is long overdue, because of the shipping transportation of goods and commodities from Asia to Europe through several oceans is not only long, but also a very expensive operation, the value of Belarus and the city of Mozyr, in particular, may further increase.

In this case, financial services, transport operations it is desirable to establish a regional financial center. Moreover, the main settlement of transactions carried out for roubles.

If this is not done, then such a centre, which is an objective need, will appear on the territory of Poland or Slovakia. But then financial transactions will be conducted in euros or dollars and bring additional financial income to the countries, where can be located the strategic military systems that threaten Russia.

Thus, from an economic point of view, there are prerequisites for creation of financial center type "transport hub" on the territory of Belarus. It can be located in Minsk or Mozyr.

An additional motivating factor for its occurrence can serve, as it does not seem strange at first glance, the figure of the Belarusian political leader Alexander Lukashenko.

To its undoubted advantages as a leader include the fact that he used many other CIS countries, led his country to the economic level of 1990, did not allow the wild privatization, the saturation is pursuing a social policy. In Belarus there is no explicit oligarch, but there is no exaggerated stratification of population by income level with all the attendant set of challenges and threats to national security. Considering the weak level of security of Belarus own energy resources and raw materials, it can be argued that the political leadership has done almost everything possible to ensure the prosperity of their country.

Some cross-country financial problems with the approval of the Russian gas price can be considered irrelevant; indeed the financial level of Russian-Belarusian differences in several times less than the annual increase in personal wealth of some of the Russian oligarchs (so that the main current problems of Russia not in Belarus).

Given (see above) that in the next time in the activities of financial centers will be the most significant indicators of state control of business, it appears that A. G. Lukashenko is the man who the term could lead the Belarusian regional financial centre, from the beginning, laying his foundations sound management principles.

Additional necessary conditions for the country's regional financial center is its investment attractiveness and availability of a developed stock exchange system.

 

Conclusion

Financial aggression of Western countries against the backdrop of rising debt, the depreciation of the dollar, and soon the exhaustion of proven reserves of the world's major energy resources (oil, gas, uranium) leads to the necessity of developing large-scale measures response response.

One such measure could be the creation of financial centres, which due to the scale effect and the concentration of the available financial resources on priority areas of economic activities can allow you to more effectively carry out financial and economic policy of the country or group of countries to ensure security and raise living standards for their populations.

Due to the peculiarities of its geographical position at the intersection of energy and transport flows East-West" Belarus could become the founder of the regional financial center of the type "transport hub".

To achieve this it is necessary to solve a number of political and economic issues, primarily the integration of different social essence of the economies of Russia and Belarus.

However, the problem of creation of the Belarusian regional financial center has the objective preconditions of a positive decision. It will benefit not only Belarus, but also Russia.

 

Sergei Grinyaev, Alexander Fomin

Tags: Russia


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