Sanction-hit tyremaker Belshina patriotic amid war in Ukraine

As the war between Russia and Ukraine entered its fifth day on 28 February, and as talks between the Russian and Ukrainian governments were set to take place, local news reports suggested that troops from nearby Belarus were set to enter combat. The significance for the tyre industry is that, as well as obvious and tragic implications for Ukraine and its domestic tyre business, there is now evidence that the conflict’s ramifications are reaching neighbouring countries. But where does Belarussia’s leading tyre manufacturer, Belshina, fit into this picture?

Multiple news services have reported that missiles were fired from Belarus at targets in Ukraine in the first days of the war, but the latest reports suggest that Belarussian paratroopers and other combat forces are now crossing the border into Ukraine in support of Russian forces (although US intelligence had not officially confirmed those reports at the time of going to press).

Manufacturing-wise, Belshina – which celebrates its 50^th anniversary this year – sits at the centre of domestic tyre production in Belarus. The tyre manufacturer, which specialises in off-the-road tyres, is stridently patriotic as a post on the news section of the company’s website illustrates.

In honour of Fatherland day, a commemoration honoured by Russia, Belarus, Kyrgyzstan, Kazakhstan and Tajikistan, on 23 February 2022 Belshina noted: “the defender of the Fatherland is everyone who considers it his duty to protect his native land, protect its interests, whose life and work are subordinated to a single goal – the well-being and prosperity of our country.” Continuing, the post added: “May this holiday be a symbol of peace, justice and love for the Motherland.”

Belshina is clearly patriotic, but what do current events mean for local and regional tyre businesses? (Photo: Belshina)

The fact that Belarusian President Aleksandr Lukashenko extended greetings to Belshina’s workers as the enterprise entered its 50th anniversary year on 31 December 2021 further emphasises the point.

According to the local Belarus Telegraph Agency (Belta), the head of state said that over the past half a century the plant has become “one of the flagships of the country’s petrochemical industry” and its products are now well known “far beyond Belarus and are deservedly in high demand”.

“I am convinced that Belshina will make a considerable contribution to the national economy, and the glorious traditions and experience will let the team of the company to look into the future with confidence”, Belta reported President Lukashenko as saying, while also wishing the firm’s staff “strong health, happiness, and well-being”.

Sanctions hamper international trade

Despite its 50-year history, international exports from Belshina will be significantly hampered by US sanctions implemented in June 2021 as well as sanctions imposed by the EU in December 2021.

Official documents confirming the latter sanctions describe Belshina as “one of the leading State-owned companies in Belarus”, adding: “As such, it is a substantial source of revenue for the Lukashenka regime.”

Those documents also raised questions about the firm’s employment practices: “Employees of Belshina who protested and went on strike in the wake of the 2020 presidential elections in Belarus were dismissed. Belshina is therefore responsible for the repression of civil society.”

Belshina reportedly achieved sales of $264.11 million in 2020, so the question is in light of the US and EU sanctions and now the war in Ukraine, where will Belshina sell its tyres moving forward? One possibility is Central and South America. Indeed, the Belarusian Foreign Ministry highlights the role Gaitan Aviles, the manager and co-owner of the Nicaraguan company Auto Aleman Asociados Nicaragua SA, who promoted Belarusian tractors in Nicaragua, Guatemala, Honduras, El Salvador and Costa Rica following a series of meetings in 2013. Serbia, where Belshina has taken part in large-scale agricultural trade fairs such as the Navi Sad fair in recent years, is another possibility.

As well as its main Belarus-based tyre manufacturing business, Belshina has seven subsidiaries operating in the sales and distribution of tyres mainly located in different parts of Russia.

Tyres & Accessories has contacted Belshina for comment on the implications of the war on the local and regional tyre business. With international sanctions already biting down on Russia (and no-doubt impacting neighbouring economies too), and with Belarussian ground troops now also being deployed, it is hard to imagine how the tyre business in Belarus won’t be affected.