Belarusian Universal Commodity Exchange

Good afternoon to all fans of financial markets.

It turns out that there is also a trading platform in Belarus, called the Belarusian Universal Commodity Exchange. True, it differs from most global platforms of this kind, but this is a real market institution, where prices are formed under the influence of supply and demand, and not Lukashenko’s directives.

Nothing human is alien to the Belarusian president, but here, too, a unique understanding of the market was demonstrated. Let's try to figure out what is the difference between capitalism in Belarusian style using the example of the Belarusian Universal Commodity Exchange.

About the exchange

Country and site	Belarus, Minsk
Year founded Owners (founders)	2004 Republic of Belarus "Belresursy" "Eximgarant of Belarus" Read also: STEX Exchange (STEX) - review, registration, personal account, trading, input and output "Belarusbank"
Number of goods traded	Metal products Forest products Agricultural products Industrial and consumer goods
Capitalization Annual trading volume	1.6 billion euros
Indexes	Formed upon request
Official site	www.butb.by
Work schedule Session duration time Moscow time	From 11-00 to 14-30 3.5 hours

What hinders development?

Confusion of laws.
Lack of various mutual funds and other financial institutions.
Managing the economy using old command-administrative methods.
Very strict conditions for issuing securities. To issue bonds, a legal entity must have net assets worth at least 1 million euros and a positive financial result from its main activity.
Lack of clear operating rules (at the legislative level) for investors.
Lack of a mechanism for the exchange to create its own index.
Insufficient education of the country's citizens in the field of the stock market.

How the auction works

Trading takes place on an online electronic platform through accredited brokers:

An application is placed for the purchase or sale of goods that are allowed for trading.
If the application meets the conditions, then the exchange deposit must be transferred.
After the transaction is completed and all obligations are fulfilled, the deposit will be returned to the owner.

Such measures provide for liability to counterparties and BUCE guarantees to all participants.

Trading in each section of the Belarusian Universal Commodity Exchange is conducted separately and does not exceed one hour. In fact, you can place an order and wait for it to be executed, since all of them must fit within a certain price corridor.

Here the desire to control prices and not let them out of state control is manifested. This is the Belarusian zest in the overall market pie.

Search for purchases

To start searching for tenders, go to the “Purchases” section.

You will be presented with a long, detailed list of trades, including information about:

registration number and subject of each purchase;
form of conduct and initial cost in the national currency of Belarus;
customer and type of transaction financing;
publication date and deadline for submitting proposals from performers;
the number of proposals received and the state of the procurement.

To make your search easier, use the built-in filter located in front of the list of purchases.

Thanks to it, you can select auctions for a specific item, customer, region, start date, or other parameters that suit your situation. After the search settings have been adjusted, click on “Search”. The service will compile a selection of purchases based on the parameters you entered.

Participants

You can work on the Belarusian platform through brokers or independently by concluding a direct agreement with the exchange.

To trade directly, you need to prepare a package of documents, which includes:

agreement with the Belarusian Universal Commodity Exchange;
electronic digital signature, endorsed by the management of the trading platform;
programs for working remotely from computers.

Most enterprises that trade constantly prepare traders on their own using the platform in a few days. Since the trading process on the Belarusian Universal Commodity Exchange is specific, brokers are not financial figures, but producers or buyers of specific products.

How to list on the stock exchange

If there is a product from the assortment traded on a universal platform, or a desire to buy it, then conducting a transaction is not difficult. The set of documents is small, registration is simple, and the transactions themselves can be single, irregular or permanent. The main condition is the presence of a real product or interest in purchasing it. There is no place for speculators and speculative transactions at BUCE: everything is aimed at the real economy.

The main participants of the universal commodity exchange are enterprises of the Republic of Belarus, which find here raw materials for production and a market for their goods.

Advantages and disadvantages

There are many advantages to trading on the Belarusian Universal Commodity Exchange:

First of all, the buyer and seller have confidence that they will find the right product or consumer.
Solid guarantees of execution of all transactions. In this case, BUCE acts not only as an intermediary, but also as a guarantor for all trade agreements.
On the Belarusian Universal Commodity Exchange, price jumps under the influence of emotions or speculation are impossible, since there are no opportunities for speculative transactions, and emotions are controlled by a price corridor, beyond which placing orders is also impossible.

But this is still not a universal market platform in the full sense of the word. Limitations from advantages smoothly flow into disadvantages, since prices for goods are not quite market prices. This kind of trade is only possible on a closed market like the Belarusian one, where all purchases are made between their own enterprises.

Goods allowed for trade

Trading on the Belarusian Universal Commodity Exchange is conducted for the following groups of goods:

metal products;
forest products;
agricultural products;
manufactured goods and consumer goods;
government procurement and property trade.

The basis consists of those categories of goods that are produced in the republic. In essence, the Belarusian Commodity Platform is focused on the national manufacturer, and there is a division between products intended for the domestic market and supplies for export.

Binary options and Forex

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For Belarus, such establishments look out of place. Forex is important for the currency and stock exchange. But currency trading on the BVSE takes place under the vigilant control of government agencies and creates a rate that is very far from the market one. Currency control in the republic is not an empty phrase.

But binary options in Belarus can create a criminal offense for participants in commodity relations. Which, however, is for the best - it will scare away amateurs and will not allow the scammers who organize this attraction to turn around, attracting people with incredible profits. Although it all ends in defrauding gullible citizens.

Regulation of cryptocurrencies in the Republic of Belarus

On December 21, 2022, the country issued Decree No. 8 entitled “On the Development of the Digital Economy,” which actually legalized transactions with cryptocurrencies and tokens. Residents of the country can freely buy and sell assets without paying tax on these transactions. Main provisions of the decree:

Extension until January 1, 2049 of the special legal regime of the Hi-Tech Park. HTP is a regime aimed at simplifying the development of IT business in Belarus. Does not apply to free economic zones, operates on the principle of extraterritoriality. Entrepreneurs registered in the HTP are entitled to certain preferences.
Extension until January 1, 2023 of the preferential treatment for all resident companies of the Hi-Tech Park. There is no income tax, but there is a contribution of 1% of gross revenue, these funds go to the park administration. The income tax rate has been reduced to 9%.
Creation of a legal basis for the circulation of cryptocurrencies, which allows companies to raise funds through ICOs and provide services for the exchange of cryptoassets.
Introduction for Park residents of many documents common in international practice (English law) - option agreements, irrevocable powers of attorney, etc.
Foreign organizations that provide advertising, consulting, and marketing services to companies registered in the HTP may not pay VAT and income tax. This was done with the aim of more actively promoting IT business in foreign markets.
A number of measures to simplify foreign exchange transactions for HTP resident companies. Removal of restrictions on transactions with electronic money, permission to own foreign bank accounts.
Simplification of hiring foreign specialists - visa-free regime for 180 days for founders and employees, cancellation of hiring permits.

Individuals are allowed to mine, buy, sell and exchange crypto-assets, as well as pass them on by inheritance. Legal entities, in addition to all of the above, have the right to create and distribute their own tokens.

It is not easy to become a resident of the Hi-Tech Park; companies are subject to strict requirements. This is one of the reasons for the still small number of regulated cryptocurrency exchanges, exchangers and other services, despite more than favorable conditions for them.

Trading indices

The originality of the Belarusian Universal Commodity Exchange is manifested in this. Indexes are calculated, but not in real time, but as a statistical indicator based on an individual request. They are calculated for each group of traded goods.

Prospects for investing in these indices

There are no prospects, since this is not a market indicator, but a simple economic conclusion from trading. All restrictions on market trading make the index not a universal commodity for speculation or investment, but an ordinary statistic of the Belarusian economy.

Brief description of the stock market of Belarus

Main market indicators

BYR Composite and ITRBYR Composite - corporate bond market indices
There is no special integrated index for the stock market, but there are statistics on the level of capitalization and trading volume, as, for example, can be seen in Table 1.

Table 1. Level of capitalization of the stock market of the Republic of Belarus:

Indicator	Current value, BYR	Change to previous value
Share market capitalization at weighted average price	2 587 231 283 195	-31,39%
Share market capitalization at par	909 264 454 176	-10,70%

Trading volumes by shares

Table 2. Market trading volume for a period of 90 days:

Ticker	Last trade date	Volume in rub.	Volume in pcs.	Price, in rubles	Change to previous price
Minskvodstroy A 1	28.10.2015	3.51 billion	390	9 million	497,64%
CentroEnergoMontazh A 3	02.11.2015	126.5 million	575	220 thousand	0,00%
Mozyrsol A 1	27.10.2015	125 million	500	250 thousand	0,00%
MinskZavodOtopObor A 3	02.11.2015	56.5 million	689	76.91 thousand	2,19%
Gomelkabel A 4	27.10.2015	21.46 million	447	47.68 thousand	1,41%

As can be seen from Table 2 (trading results over the last 90 days), the level of liquidity of the stock market is at an extremely low level.

The only outsider of all the general negativity is the company Minskvodstroy A 1, where the level of growth looks quite impressive. According to some reports, this is due to the attraction of a reputable foreign investor to implement a large-scale project to reconstruct the water supply system of the capital region (since the times of the USSR, the deterioration of networks is more than 80%).

In general, the market looks quite thin, and the volume of shares in free float is clearly insufficient to talk about an attractive market for a large investor.

General stock market indicators

Even if we look at the data on the level of liquidity that was on the market for the entire 2015 (Table No. 3), we can draw the following and even some encouraging conclusions:

Table 3. Trading volume for December 2015 in US dollars

Sector	Meaning	Change
Stock market	570.98 million	-11,75%
Bonds, including:	570.23 million	-11,72%
Government securities	131.3 million	-58,28%
VGSB	109.12 million	-42,81%
Exchange	34.89 million	34,68%
OMZ	3.44 million	-59,92%
NB RB	68 million	12 076,77%
Corporate	223.49 million	112,18%
Stock	746.52 thousand	-31,04%

So:

The greatest demand is for shares of the commercial sector of the economy, which, to a greater or lesser extent, can be integrated into the common European economic space. It is no coincidence that more than 90% of the total trading volume is in shares, since investors are already planning in advance for the inevitable processes of involving the Belarusian economy into the global one.
The rather low volume of investments in government bonds is most likely due to the fact that investors and holders of these debts have reasonable fears about the possibility of the existing ruling regime fulfilling their obligations under them, mainly due to the declining subsidies to the Belarusian budget from Russia.