1. Introduction All business enterprises, functions within an environ- ment, called as the business environment (Business Environment, 2018). The economic environment consists of all external factors in the immediate mar- ketplace and the broader economy. The economic environment of business refers to all economic fac- tors that affect commercial behavior and consumer behavior. These factors can influence a business and define how it operates (What Is…, 2018). Business environment literature highlights the common aspects of the environment. Various studies bring into question internal and external en- vironment and its analysis. L. Hamilton and P. Web- ster (2018) consider global business environment in the context of globalization, analyze global indus- tries and common global economy. They also focus on such issues as political, legal, ecological environ- ment and socio-cultural, technological and financial framework. D. Campbell and T. Craig (2005) mark out external business macro- and micro-environment. External business macro-environment includes macro-economic management and political, socio- logical, technological, ecological, legal and interna- tional business environment. I. Worthington and CHANGING BUSINESS ENVIRONMENT IN BELARUS Olena Hrechyshkina (1), Maryia Samakhavets (2) (1) Historical and Cultural Heritage Department, Polessky State University, Dneprovskoy Flotilii, 23, Pinsk, 225710, Belarus, ORCID: 0000-0003-0653-9210 e-mail: l_grechishkina@mail.ru (corresponding author) (2) Finance Department, Polessky State University, Dneprovskoy Flotilii, 23, Pinsk, 225710, Belarus, ORCID: 0000-0002-4564-2424 e-mail: samkhvec@rambler.ru Citation Hrechyshkina O., Samakhavets M., 2019, Changing business environment in Belarus, Journal of Geography, Politics and Society, 9(1), 1–11. Abstract The paper considers the business environment in the context of socio-economic development of the Republic of Belarus. It is analyzed and evaluated the current state of the Belarusian business in terms of various criteria: activity objectives, ownership types, organizational and legal forms, size. In this paper aspects of transformation of property relations and other priorities of macroeconomic environment in the Republic of Belarus for a long, medium and short term are given. The paper is based on data in the Belarusian economy in 2012-2018. The raw data is extracted and processed by authors from the database of the National Statistical Committee of the Republic of Belarus. Key words business environment, changes, economic development, organizations, enterprises, Belarus. Received: 14 January 2018 Accepted: 12 February 2019 Published: 31 March 2019 Journal of Geography, Politics and Society 2019, 9(1), 1–11 DOI 10.26881/jpgs.2019.1.01 2 Olena Hrechyshkina, Maryia Samakhavets Ch. Britton (2009) underline that business organiza- tion is in constant interaction with its unique and changeable environment. The authors distinguish immediate or operational (suppliers, competitors, financial institutions, etc.) and general or contex- tual (economic, political, socio-cultural, legal, etc.) environment. M. Schiffer and B. Weder (2001) come out that small- and medium-scale enterprises are at a disadvantage in comparison with larger firms in economy. So impediments with financing, taxes and regulations, inflation should be prime targets for state policy directed at leveling the playing field. J. Paul (2006) demonstrates development of politi- cal, investment, social, technological environment on specific examples of Indian economy as well as many other countries. The aim of the paper is to analyze changes in the business environment of the Republic of Belarus in the context of socio-economic development. This paper is based on original analysis of primary data on economic activity in the Belarusian economy in the year 2012–2018. The raw data is extracted and processed by the authors from the database of the National Statistical Committee of the Republic of Be- larus, based on the submitted balance sheets of the Belarusian companies. Data interpretation is based on a comparative perspective provided by the rel- evant literature. Forecast quantitative indicators and qualitative characteristics are taken from the official documents of national state institutions. International compari- sons are based on the World Bank data. 2. The economic development priorities of the Republic of Belarus Quantitative indicators and qualitative characteris- tics of macroeconomic environment, economic and social structure, scientific and technological devel- opment, foreign trade, dynamics of production and consumption, level and quality of life, environmen- tal conditions are contained in the national forecast documents of socio-economic development of the Republic of Belarus, which includes: 1. The Concept of the National Sustainable Devel- opment Strategy (CNSDS) of the Republic of Bela- rus for the period until 2035 (long-term perspec- tive) (Koncepciâ …, 2018). 2. The National Sustainable Socio-Economic De- velopment Strategy (NSSEDS) of the Republic of Belarus for the period until 2030 (long-term per- spective) (Nacional’naâ strategiâ…, 2017). 3. The Program of Socio-Economic Development of the Republic of Belarus for 2016–2020 and meas- ures for its implementation (medium-term per- spective) (Programma…, 2017). 4. The annual forecast (tasks) of socio-economic development of the Republic of Belarus for 2019 (short-term period). The person as an individual and generator of new ideas (social component), the competitive economy (economic component) and the environment qual- ity (environmental component) are interrelated and complementary components of sustainable devel- opment in accordance with the CNSDS (Koncep- ciâ…, 2018) and NSSEDS (Nacional’naâ strategiâ…, 2017). The strategic goal of the Republic of Belarus is to ensure high living standards and conditions for the individual harmonious development based on the transition to a highly efficient economy of knowledge and innovation, while maintaining a fa- vorable environment for future generations. The following tasks will be consistently solved in the economic sphere to achieve this goal: • formation of a highly efficient, socially oriented and competitive knowledge economy; • accelerated development of high-tech industries, industrial innovation clusters and infrastructure sectors of the economy; • creating an effective ownership structure, in- creasing the efficiency of public administration and growing local initiatives; • expansion of international economic coopera- tion (with China, the Russian Federation, the EU); • efficient resource management and reducing of production and consumption waste. The main expected quantitative economic parame- ters of Belarus pursuant to the NSSEDS are following: GDP growth is 1.5–2.0 times for 2016–2030; GDP per capita based on purchasing power parity is 30–39 thousand USD by 2030; 30th rank in the World Bank’s rating «Doing Business» (Nacional’naâ strategiâ…, 2017). The top three economies according to the “Do- ing Business-2019” are New Zealand, Singapore and Denmark, which exemplify a business friendly environment. It means that such economies have consistently well designed business regulation or whose regulatory environment has thrived thanks to the comprehensive reform over the years (Doing Business…, 2019). Belarus ranks 37 position of 190 economies according to the “Doing Business-2019” (tab. 1). The table 1 shows that the Republic of Belarus has achieved significant success in strengthening its position in the World Bank’s «Doing Business» – from 129 rank in 2006 up to 37 in 2019. Such situation was due to the consistent state efforts for improving core Changing business environment in Belarus 3 areas in doing business according to 10 indicators (tab. 2). In 2015 Belarus made paying taxes easier for companies by introducing an electronic system for filing and paying contributions for the obligatory in- surance for work accidents and by simplifying the fil- ing requirements for corporate income tax and value added tax (VAT). It allowed Belarus to improve posi- tion in «Doing Business» from 133 in 2014 up to 60 in 2015. Then Belarus made starting a business and transferring property simpler. There were great changes in the Belarusian busi- ness environment in 2017. Belarus streamlined the process of obtaining an electricity connection by es- tablishing a one-stop shop at the utility that fulfills all connection-related services, including the design and construction of the distribution line. Belarus also made it easier to transfer a property by improv- ing the transparency and reliability of the land ad- ministration system. Belarus strengthened minor- ity investor protections by introducing remedies in cases where related-party transactions are harmful to the company and requiring greater corporate transparency. As for getting credit in Belarus, the credit bureau started to provide credit scores, strengthening the credit reporting system in 2017 and two new de- crees that establish a unified collateral registry were adopted in 2018. In 2019 Belarus made starting a business easier and made dealing with construction permits easier by streamlining the process at the one-stop shop. Belarus still has untapped reserves for further ad- vancement in the rating despite the achieved pro- gress. An important task is to simplify taxation, strengthen access to credit, deal with resolving in- solvency, achieving equal competition and ensuring market freedoms for business. Strategic priority for the economic development of the Republic of Belarus becomes a formation of favorable business environment and improvement of institutional environment. It is intended to ensure the stability and transparency of the business envi- ronment, to eliminate redundant and to unjustified government intervention in the activities of business entities, improving the quality of public services, fi- nancial accessibility, etc. 3. Modern business environment in the Republic of Belarus The Belarusian business entities are classified ac- cording to various criteria: activity objectives (prof- it-making and non-profit), ownership types (public, private, foreign), organizational and legal forms (open or closed joint-stock companies, limited liabil- ity companies, additional liability companies, uni- tary enterprises), size (medium, small, micro). Tab. 1. Ease of doing business ranking of Belarus Year 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Rank 129 110 85 58 68 69 58 63 57 44 37 38 37 Source: Doing Business…, 2019. Tab. 2. Doing Business indicators – ranks of Belarus Indicator 2015 2016 2017 2018 2019 1. Starting a business 40 12 31 30 29 2. Dealing with construction permits 51 34 28 22 46 3. Getting electricity 148 89 24 25 20 4. Registering property 3 7 5 5 5 5. Getting credit 104 109 101 90 85 6. Protecting minority investors 94 57 42 40 51 7. Paying taxes 60 63 99 96 99 8. Trading across borders 145 29 30 30 25 9. Enforcing contracts 7 25 27 24 29 10. Resolving insolvency 68 69 69 68 72 Source: Doing Business…, 2019. 4 Olena Hrechyshkina, Maryia Samakhavets The authors consider the structure and dynam- ics of the Belarusian organizations in terms of dif- ferent signs. First of all, it should be noted that total number of business entities increased by 15% from 122,962 units up to 141,418 units accordingly for the period 2012-2018 (tab. 3). In 2013–2014 there was a significant annual growth of 7%, but since 2016 the total number of business entities has been de- creasing. In general, these changes are due to the growth of profit-making organizations by 15,428 units (15.45%), although in 2016 and 2018 they de- creased in comparison with the previous period. In terms of activity objectives, profit-making organiza- tions dominate in the structure of all organizations and account for 82%. It is logical that profit-making organizations form the basis of the business environment in the Repub- lic of Belarus, because they create national income by extracting profits as the main goal of their activ- ity. At the same time, non-profit organizations (edu- cational, health care, cultural, and other institutions) determine the human development within the framework of the knowledge economy. In addition they can also carry out business activities within the framework of statutory goals (Samohovec, 2017). The study of the dynamics of profit-making or- ganizations (tab. 4) shows that the number of joint- stock companies decreased by 7% (by 258 units) in 2018 as compared to 2012 and amounted to 3,782 units, 57.5% of them applied to open joint stock companies. The number of limited liability companies increased significantly (by 67%) and amounted to 57,462 units. The number of additional liability com- panies and unitary enterprises decreased by 35% and by 9% and amounts to 5,234 units and 45,334 units accordingly. The structure of profit-making organizations has changed significantly during the study period. Limit- ed liability companies formed almost half of all prof- it-making organizations. Their share increased by 15.29%. On the contrary, the share of all other organ- izations decreased: joint-stock companies by 0.79% (3.28% in the structure), additional liability compa- nies – by 3.49% (4.54% in the structure), unitary en- terprises – by 10.49% (39.33% in the structure). It is Tab. 3. Dynamics of the business entities number in the Republic of Belarus (the data is given on January 1 of the relevant year) Indicators 2012 2013 2014 2015 2016 2017 2018 Total business entities [units] 122,962 131,667 141,897 145,106 141,600 142,610 141,418 Basic growth rate [%] – 107.08 115.40 118.01 115.16 115.98 115.01 Chain growth rate [%] – 107.08 107.77 102.26 97.58 100.71 99.16 Profit-making organizations [units] 99,828 107,761 117,474 119,937 116,190 116,761 115,256 Basic growth rate [%] – 107.95 117.68 120.14 116.39 116.96 115.45 Chain growth rate [%] – 107.95 109.01 102.10 96.88 100.49 98.71 Non-profit organizations [units] 23,134 23,906 24,423 25,169 25,410 25,849 25,162 Basic growth rate [%] – 103.34 105.57 108.80 109.84 111.74 108.77 Chain growth rate [%] – 103.34 102.16 103.05 100.96 101.73 97.34 Source: own study based on Statističeskij ežegodnik …., 2012–2018. Tab. 4. Dynamics of profit-making organizations in the Republic of Belarus (the data is given on January 1 of the relevant year) Organizations 2012 2014 2016 2018 units share, % units share, % units share, % units share, % Profit-making organizations, total, including 99,828 100.00 117,474 100.00 116,190 100.00 115,256 100.00 Joint stock companies 4,067 4.07 4,058 3.45 4,001 3.44 3,782 3.28 open joint stock companies 2,300 2.30 2,272 1.93 2,262 1.95 2,175 1.89 closed joint stock companies 1,767 1.77 1,786 1.52 1,739 1.50 1,607 1.39 limited liability companies 34,507 34.57 45,726 38.92 50,371 43.35 57,462 49.86 additional liability companies 8,021 8.03 6,910 5.88 6,029 5.19 5,234 4.54 unitary enterprises 49,739 49.82 57,242 48.73 52,314 45.02 45,334 39.33 Source: own study based on Statističeskij ežegodnik …., 2012, 2014, 2016, 2018. Changing business environment in Belarus 5 expected a further reduction of unitary enterprises due to their incorporation in the future. The export and major GDP generating enterpris- es in Belarus are mainly represented by open joint- stock companies (JSC «Belaruskali», JSC «Naftan», OJSC «BELAZ», JSC «Minsk Automobile Plant», etc.). Important task for enterprises of this organizational and legal form for the future is to increase their capi- talization and to enter into the international capital market through IPO. 4. Transformation of ownership relations in the Republic of Belarus Statistics show that the number of public enterprises decreased (from 17,629 units in 2012 to 16,047 units in 2018) while the number of private and foreign en- terprises increased, with, as a consequence, of the targeted state actions in transforming ownership relations and expanding private sector activities in the economy. The number of private business entities amount- ed to 117,742 units in 2018 (16.7% more than in 2012). However, the largest number of private busi- ness entities was recorded in 2015 (122,036 units). This number decreased in subsequent years. The number of foreign business entities had a steady up- ward trend. There were 7,629 units in 2018 (72.5% more than in 2012). This was the highest value for the time period under study. Changes in the organization’s structure of various ownership types are clearly presented in fig. 1. The authors consider it is expedient to study the ownership of fixed assets in order to make a con- clusion about predominance of private or public capital. According to tab. 5, the share of fixed assets owned by public enterprises decreased by almost 10%, while the share of fixed assets of private busi- ness entities increased by 7.93% and foreign ones by 1.63% for the analyzed period. The low share of fixed assets of foreign enterprises testifies to the problems in attracting foreign investment. Although the dy- namics of this indicator is positive in general, there is the task of formation of transnational corporations on the basis of the Belarusian organizations. At the same time, 11.35% of all business entities were pub- lic and they hold 44.98% of all fixed assets in 2018. It confirms the concentration and centralization of the public capital in economy. In addition, the public sector has traditionally played a major role in fixed investment and generally has a significant impact to the financial sector development in the country (Samohovec, 2016). Public enterprises and enterprises with state- owned share provided 76.4% of industrial output (Osnovnye pokazateli…, 2018), 36% of exports of goods and 35.8% of exports of services, 60.3% of 14.34% 13.40% 12.09% 11.45% 11.69% 11.48% 11.35% 82.07% 82.64% 83.72% 84.10% 83.75% 83.44% 83.26% 5.39% 5.08% 4.56% 4.45% 4.18% 3.96% 3.60% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 2012 2013 2014 2015 2016 2017 2018 public ownership private ownership foreign ownership Fig. 1. Changes in the organization’s structure of various ownership types in the Republic of Belarus Source: Own study based on Statističeskij ežegodnik …., 2012–2018. 6 Olena Hrechyshkina, Maryia Samakhavets investments in fixed capital at the end of 2017. It indicates the predominance and significant role of public sector in the Belarusian economy despite the less public enterprises. At the same time, very important issue is to en- hance public sector efficiency and to transform public enterprises into highly profitable assets. Key performance indicators are annually determined for public enterprises and joint companies if 50 or more percent of shares belong to the state. But it is not al- lowed to bring indicators to small and micro-organi- zations and to organizations with foreign capital. Transition to public ownership management based on market principles, formation of systemical- ly linked mechanisms and measures for the privatiza- tion of public ownership are becoming priority tasks in the economic environment of the Republic of Be- larus. This is supposed to be carried out through: • realization of a part of liquid enterprises with a state-owned share on the open market when the market conditions are favorable; • privatization of small- and medium-sized public enterprises, focused on investments attraction, production facilities modernization and new working places creation; • transfer (free or at a reduced price) of public en- terprises shares to the most active and successful domestic managers. It is planned to increase the transparency of public enterprises, to create a common database of state assets, to publish a comprehensive report with sum- mary performance indicators in public access and to form an integrated monitoring system of public enterprises results. Then authors consider the main sectors of the Be- larusian economy, as well as the number of employ- ees in the context of different ownership types. Sec- toral structure of enterprises of various ownership types is presented in tab. 6. These data show uneven distribution of private and foreign business entities in the main sectors of the economy. This is due to the interest of business in areas which can provide the Tab. 5. Ownership of fixed capital (the data is given on January 1 of the relevant year) Indicators 2012 2013 2014 2015 2016 2017 2018 Fixed assets, total [billion rubles] 104.47 143.55 179.05 211.10 242.51 269.80 293.90 including by ownership: public ownership [billion rubles] 56.98 75.47 90.76 99.17 109.69 122.60 132.20 Share [%] 54.54 52.57 50.69 46.98 45.23 45.44 44.98 private ownership [billion rubles] 43.68 63.45 82.00 103.80 122.28 134.80 146.20 share [%] 41.81 44.20 45.80 49.17 50.42 49.96 49.74 foreign ownership [billion rubles] 3.81 4.63 6.29 8.13 10.54 12.40 15.50 share [%] 3.65 3.23 3.51 3.85 4.35 4.60 5.27 Source: own study based on Statističeskij ežegodnik …., 2018. Tab. 6. Sector structure of enterprises of various ownership types in the Republic of Belarus [%] (the data is given on January 1 of the relevant year) Sectors Public ownership Private ownership Foreign ownership Total 2012 2015 2018 2012 2015 2018 2012 2015 2018 2012 2015 2018 Agriculture, forestry and fisheries 3.59 3.01 3.24 3.96 3.53 3.76 1.27 1.53 1.70 3.81 3.38 3.59 Industry 4.14 3.35 2.19 14.30 13.23 12.77 15.31 12.18 12.26 12.88 12.05 11.54 Construction 1.83 1.58 1.48 9.04 8.99 8.43 6.53 5.50 4.68 7.91 7.99 7.44 Wholesale and retail trade; car and motorcycle repair 0.98 0.81 0.70 38.67 35.60 32.90 45.47 46.17 43.86 33.51 32.09 29.84 Others 89.47 91.26 92.40 34.03 38.64 42.14 31.43 34.61 37.50 41.88 44.49 47.59 Total 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 Source: own study based on Statističeskij ežegodnik …., 2012, 2015, 2018. Changing business environment in Belarus 7 fast turnover of capital and a high level of income (trade, services). The strategic goal of the Belarusian industrial complex development for the period until 2030 is the gradual approximation of the efficiency indica- tors of industrial production to the average level of the EU countries. As for agriculture, it is the forma- tion of competitive on the world market and envi- ronmentally safe agricultural production. Let’s analyze allocation of the employed popu- lation in the context of public, private and foreign ownership types of enterprises (tab. 7). The number of employees in the public sector decreased by 11.00% in 2017 compared to 2012. At the same time, the share of employees in the pri- vate sector remained approximately at the previous level; slight fluctuations were observed (± 1%). Ab- solute and relative quantity of employees of foreign business entities increased. This is associated with an increase of the number of the Belarusian enterprises. The Belarusian business entities are divided into microorganizations (the average number of employees does not exceed 15 persons), small or- ganizations (from 16 to 100 people), medium-sized organizations (from 101 to 250 people) and large organizations (more than 250 people) in accord- ance with generally accepted statistical classification which depends on the average number of employ- ees during the calendar year. The following is how small and medium-sized business entities developed in the Republic of Bela- rus in 2012–2017 (tab. 8). The number of micro-, small and medium-sized organizations increased to 9,985 units (by 10%) over this period, due to the increase of micro-organizations by 10,172 units (by 11.87%) and reduction of medium-sized organizations by Tab. 7. Structure of the employed population by ownership types of the Belarusian enterprises Indicators 2012 2013 2014 2015 2016 2017 Employed population, total, thousand people 4612.10 4578.40 4550.50 4496.00 4405.70 4353.60 including by ownership public ownership, thousand people 1965.00 1879.40 1771.60 1765.30 1769.70 1744.70 share [%] 42.61 41.05 38.93 39.26 40.17 40.07 private ownership, thousand people 2538.50 2566.10 2631.80 2576.60 2478.60 2437.30 share [%] 55.04 56.05 57.84 57.31 56.26 55.98 mixed ownership without foreign participation, thousand people 880.90 858.70 857.60 833.70 807.10 767.20 share [%] 19.10 18.76 18.85 18.54 18.32 17.62 mixed ownership with foreign participation, thousand people 278.90 308.80 314.00 301.60 281.30 275.70 share [%] 6.05 6.74 6.90 6.71 6.38 6.33 foreign ownership, thousand people 108.6 132.9 147.1 154.1 157.4 171.6 share [%] 2.35 2.90 3.23 3.43 3.57 3.94 Source: own study based on Statističeskij ežegodnik …., 2018. Tab. 8. Dynamics and structure of small and medium-sized business entities in the Republic of Belarus Indicators 2012 2013 2014 2015 2016 2017 Number of micro, small and medium organizations, units 99,986 111,112 114,208 107,441 107,382 109,971 Medium-sized organizations 2,542 2,423 2,416 2,394 2,315 2,245 share [%] 2.54 2.18 2.12 2.23 2.16 2.04 micro- and small organizations 97,444 108,689 111,792 105,047 105,067 107,726 share [%] 97.46 97.82 97.88 97.77 97.84 97.96 microorganizations 85,682 96,858 99,368 92,684 93,288 95,854 share [%] 85.69 87.17 87.01 86.27 86.87 87.16 small organizations 11,762 11,831 12,424 12,363 11,779 11,872 share [%] 11.76 10.65 10.88 11.51 10.97 10.80 Individual entrepreneurs, people 232,851 248,546 248,952 240,781 235,995 236,138 Source: own study based on Maloe i srednee…, 2018. 8 Olena Hrechyshkina, Maryia Samakhavets 297 units (by 11.68%). The number of small organi- zations and individual entrepreneurs was main- tained at about the same level. There have been no significant changes in the structure of organizations. The contribution of small and medium-sized organizations to GDP of the Republic of Belarus re- mained approximately at the same level from 20% to 22% for the analyzed period of time. Minor fluctua- tions were associated with market conditions, both domestically and internationally. The share of small and medium-sized organizations in the country’s GDP accounted for 21.6%, incl. the share of medium- sized organizations was 6.7%, micro-organizations 6.2%, small organizations 8.7% in 2017. The share of individual entrepreneurs in GDP amounted to 3.1% in 2017. Small and medium-sized organizations will be turned into a significant development factor of the Belarusian business environment. It is provided to increase the share of gross value added (GVA) of Tab. 9. Dynamics and structure of GDP and GVA in the Republic of Belarus Indicators 2012 2014 2016 2017 million rubles share in GDP [%] million rubles share in GDP [%] million rubles share in GDP [%] million rubles share in GDP [%] Gross domestic product (GDP) 54761.67 100.00 80579.27 100.00 94949.00 100.00 105199.00 100.00 including: Gross value added (GVA), including: 48029.35 87.71 71179.15 88.33 82013.80 86.38 91357.70 86.84 Industrial sector 24321.53 44.41 34392.93 42.68 35941.70 37.85 41974.50 39.90 agriculture, forestry and fisheries 4452.64 8.13 5884.75 7.30 6547.00 6.90 8174.90 7.77 mining industry 536.30 0.98 546.96 0.68 597.60 0.63 728.90 0.69 manufacturing industry 13571.54 24.78 16992.19 21.09 19134.30 20.15 23376.90 22.22 supply of electricity, gas, steam, hot water and air conditioning 1401.05 2.56 2050.48 2.54 3585.70 3.78 3399.60 3.23 water supply; waste collection, treatment and disposal activities; pollution abatement 342.49 0.63 580.79 0.72 683.20 0.72 773.70 0.74 Construction 4017.51 7.34 8337.76 10.35 5393.90 5.68 5520.50 5.25 Service sector 23707.82 43.29 36786.22 45.65 46072.10 48.52 49383.20 46.94 wholesale and retail trade; repair of motor vehicles and motorcycles 7470.64 13.64 9805.48 12.17 10416.30 10.97 10243.60 9.74 transport, warehousing, postal and courier activities 3242.39 5.92 4589.04 5.70 5410.80 5.70 6066.40 5.77 temporary accommodation and food services 396.64 0.72 734.77 0.91 807.30 0.85 878.60 0.84 information and communication 1333.18 2.43 2564.75 3.18 4606.80 4.85 5309.40 5.05 financial and insurance activities 1849.59 3.38 2602.92 3.23 3872.50 4.08 4088.80 3.89 real estate operations 1744.90 3.19 3887.11 4.82 5373.00 5.66 5939.50 5.65 professional, scientific and technical activities 1002.82 1.83 2049.20 2.54 2598.70 2.74 2894.30 2.75 activities in the field of administra- tive and support services 516.16 0.94 923.62 1.15 936.80 0.99 1262.40 1.20 public administration 1595.67 2.91 2716.70 3.37 3340.00 3.52 3402.30 3.23 education 2094.17 3.82 3262.29 4.05 3923.20 4.13 4157.10 3.95 health and social services 1569.15 2.87 2482.13 3.08 3318.70 3.50 3463.20 3.29 creativity, sports, entertainment and recreation 606.15 1.11 694.91 0.86 856.90 0.90 986.50 0.94 other services 286.36 0.52 473.30 0.59 611.10 0.64 691.10 0.66 Net taxes on products 6732.32 12.29 9400.12 11.67 12935.20 13.62 13841.30 13.16 Source: own study based on Statističeskij ežegodnik …., 2018. Changing business environment in Belarus 9 micro-organizations, small and medium-sized or- ganizations in the total GDP from 20–22% (without individual entrepreneurs, with individual entrepre- neurs – 23%) nowadays to 50% in 2030. It is nec- essary to improve the institutional environment of entrepreneurship development through construc- tive dialogue between government and business (Kalіnesku et al., 2012) to provide business self-or- ganization and self-regulation, to increase the finan- cial resources availability, to simplify administrative tax procedures, to eliminate excessive and unjusti- fied state interference to business management, to form an integrated educational system in the field of entrepreneurship. 5. Forecast of economic development of the Republic of Belarus In general, economic development of the Republic of Belarus was rather unstable in 2012–2018 with rel- atively low rates of annual GDP growth (about 1%) and economic decline in 2015–2016. However, in the last two years, it has reached the trajectory of the av- erage European GDP growth rates (2.4% in 2017 and 3.5% in 2018). In the process of assessing and planning socio- economic development of the country, the structure and location of production should be taken into account. This shows the state of a social division of labor. The management of sectoral and territorial structures should be directed at business entities; there should be interest in the most effective socio- economic development of personnel. In turn, the development of industries and territories (regions), their competitiveness are based on the capabilities of enterprises, their ability to jointly form and imple- ment a development strategy, drawing to this the best intellectual, technical, financial and other re- sources; use them rationally (Kalіnesku, Grečiškina, 2009). Assessment of the dynamics and structure of the Belarusian GDP (tab. 9) shows that GVA provides 86– 88% of GDP during the analyzed period and 86.84% in 2017. Industrial sector had a positive develop- ment dynamics for 2012–2017 years but its share in GVA and GDP was gradually declining, while the share of the service sector was increasing. In the in- dustrial sector the most important types of econom- ic activity were manufacturing, agriculture, forestry and fisheries, construction (35.24% of GDP in total in 2017). There were wholesale and retail trade, car and motorcycle repair, transportation, warehousing, postal and courier activities, information and com- munications, real estate operations (26.2% of GDP in total in 2017) in the services sector. Fig. 2 shows a comparison of the Belarusian GDP per capita at purchasing power parity (PPP) with 0 5 000 10 000 15 000 20 000 25 000 30 000 35 000 40 000 45 000 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Armenia Belarus European Union Kazakhstan Kyrgyz Republic Poland Russian Federation Czech Republic Fig. 2. GDP per capita based on purchasing power parity (current international $) Source: Own study based on GDP per capita …, 2018. 10 Olena Hrechyshkina, Maryia Samakhavets some countries. In Belarus this indicator increased from 6.5 thousand dollars USA in 2010 up to 18.9 thousand dollars USA in 2018. Belarus ranks 4th among the EAEU countries (Armenia, Belarus, Ka- zakhstan, Kyrgyzstan, the Russian Federation) in this indicator, but significantly lags behind European countries. For example, GDP per capita at PPP is 29.1 thousand dollars USA in Poland, 36.3 thousand dol- lars USA in the Czech Republic, 41.2 thousand dol- lars USA in the EU on the whole. Therefore, the main task is to ensure sustainable economic growth in Belarus. This one founds a re- flection in the state policy documents. It is projected to increase GDP per capita to 28-36 thousand dollars USA at PPP in 2030 and GDP growth by 1.8 times for 2021–2035, including by 1.3 times in 2021–2025 and by 1.4 times in 2026–2035 (Koncepciâ …, 2018) in order to implement the goals of sustainable socio- economic development of the Republic of Belarus (Nacional’naâ strategiâ…, 2017) (tab. 10). 6. Conclusion The paper discusses the current state of Belaru- sian business environment within the framework of socio-economic development forecast for short, medium and long term. The main economic goal of sustainable development of the Republic of Belarus is transition to highly efficient competitive economy of knowledge and innovation. The priority for the Belarusian economic devel- opment becomes a formation of favorable busi- ness environment. Belarus ranks 37 position of 190 economies according to the “Doing Business-2019” but 30th rank in this rating is one of the expected economic parameters of Belarus by 2030. It is analyzed and evaluated the current state of the Belarusian business in terms of various criteria: activity objectives, ownership types, organizational and legal forms, size. The total number of business entities in Belarus is 141,418 units and it increased by 15% for the period 2012-2018. The number of micro-, small and medium-sized business entities increased by 10% and there were no significant changes in the structure of this organizations. Profit-making organi- zations dominated and accounted for 82% in the structure of all organizations in terms of activity ob- jectives. Limited liability companies formed 49.86% of profit-making organizations and unitary enter- prises – 39.33%. The number of private and foreign enterprises increased but 11.35% public enterprises (according to the organization’s structure of various ownership types) hold 44.98% of all fixed assets in 2018. It indicates the dominant role of public sector in the Belarusian economy. Sectoral structure of Be- larusian enterprises shows that almost 30% of them were related to  wholesale and retail trade, car and motorcycle repair. This represents a business interest in service areas with high level of income. Structure of the employed population of the Belarusian enter- prises indicates that 55.98% were employed in the private ownership business. It is planned to ensure the multistructural market relations in the economic sphere, to develop private initiative and entrepreneurship, to accelerate inno- vation and investment processes, to develop compe- tition. Such changes will create stable preconditions for economic growth and efficiency of the Belarusian economy. Modern business environment should be «barrier-free» for functioning of all business entities regardless of ownership, size, organizational and legal form as a result of the ownership relations re- forms. Consequently, it is necessary to ensure equal conditions for business functioning. The worthy im- age of entrepreneurs, the growth of business culture level, the partnerships and cooperation of small, me- dium-sized and large organizations must be the rule of favorable business environment in Belarus. Belarusian GDP per capita at PPP increased from 6.5 thousand dollars USA in 2010 up to 18.9 thou- sand dollars USA in 2018. GVA provides more than 80% of Belarusian GDP. It is projected to increase Belarusian GDP per capita at PPP to 28-36 thousand dollars USA in 2030 and GDP growth by 1.8 times for 2021–2035. The authors emphasize that it is possible Tab. 10. Key forecast indicators of economic development of the Republic of Belarus Indicators Actual values (in % of the previous year) Forecast Predicted values (for the five years) 2016 2017 2018 2019 2016-2020 2021-2025 2026-2030 2031-2035 GDP growth rate [%] 97.5 102.5 103.0 104.0 112.2 125.6 120.2 117.6 Labor productivity growth rate [%] 99.5 103.6 103.6 103.8 115.7 126.6 121.0 121.2 Growth rate of investment in fixed assets [%] 82.6 105.1 105.1 111.3 104.1 130.2 126.0 122.4 Source: own study based on Statističeskij ežegodnik …, 2018; Koncepciâ…, 2018; Programma social’no-èkonomičeskogo…, 2017. 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