Belarus: Baltic Beverage Holding (BBH) targets Belarus beer market

Baltic Beverage Holding (BBH), a 50-50% joint venture between Scottish & Newcastle and Carlsberg A/S, is to target the highly challenging market conditions of Belarus, media reports posted on October 10. BBH is aiming to embark on a promotional push in the eastern European state hoping boosting sales of its Arsenalinoe brand by up to 40%.

Belarus is a state that has been condemned by the European Union and the United Nations, and branded the “last dictatorship in Europe” by President George W Bush.

A spokesperson for Edinburgh-based S&N said BBH expects there to be huge demand for the company's brands in Belarus. However, he stressed there were no plans to put an "operational system" into Belarus, according to Datamonitor Newswire.

With a population of 10 million, Belarus is seen as one of the most interesting and high-potential beer markets in the region. However, despite this potential for future growth, foreign brewers in Belarus are faced with import limitations and a strong lobby for local products. The authorities insist that local products should make up 85% of retailers’ goods on offer.

In addition, the US government advises American companies to avoid Belarus altogether, in what President George Bush branded as the "last dictatorship in Europe".

Despite this, BBH already has about 13% of beer market by volume in Belarus, selling about 3.5 million liters of Arsenalinoe in the first half of this year.

A spokesman for the Belarusian foreign ministry insisted that Belarus was “very interested” in attracting foreign investment into new industries and enterprises. “We are open to foreign investors who want to realise serious projects of any size in Belarus.”

BBH’s St Petersburg brewery is the biggest in Europe. The company’s Baltika brand is the second-biggest selling beer brand in Europe after Heineken.

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