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BELARUS DURING THE ECONOMIC CRISIS
YAROSLAV ROMANCHUK,
President of the Minsk-based Mizes Center, Belarus
The policy followed by the Belarusian authorities during the financial and economic crisis confirms the axiom of the economic influence on the politics. In Belarus the economic situation exerts considerable influence upon the politics. The Belarusian authorities were not ready for the economic slack. Undoubtedly, the country faces not only the financial but also structural economic crisis.
This is shown by the economic indicators of the last quarter of the year 2008. Belarus witnesses a serious decline in output. The retail turnover has been falling for two months – in October it fell by 3.8%, and in November – by 8.5%. In 2009, the fall may make up 25-30%. In October-November the putting of dwelling houses into operation slowed down.
The total trade balance deficit has grown by 47%, the trade balance deficit with Russia has grown by 87%. The storehouses are being packed with the unsold products that cost over $2 billion. Belarus’ external debt is $4.6 billion with the banks external indebtedness having grown by 25%. The money supply increase is accompanied by strained situation in the currency market and the Belarusian ruble is being devalued. The organizations managers reduce the working week giving leaves to their employees.
This has not been indicated by the official statistical figures yet, which is causing the Belarusian authorities great concern. President Aliaksandr Lukashenka of Belarus said that all the enterprises should turn into the ministries of trade. True, he did not specify what they should sell.
Aliaksandr Lukashenka continues to be the decision making center. Three anti-crisis groups are created within the government, which compete against each other. Aliaksandr Lukashenka, feeling the situation better than anyone in the Belarusian government, said that the Belarusian economy must be liberalized. However, the liberal reforms won't be radical to solve all the existing economic problems.
If to return to the 2005 prices and volume of production, Belarus should raise $17 billion to maintain the 2008 economic level in 2009. Of course, Belarus would fail to do that even with no account taken of the new gas price in 2009.
As a result, the Belarusian President acts as the government, National Bank and a creditor. He looks for money, tries to borrow it from Russia, Germany and other countries, and seeks to sell something. Belarus’ economic situation is worsening rapidly, this way the market economy differs from the centralized economy
The crisis came to Belarus from Russia. Now Russia buy fewer Belarusian goods, non-payments started and protectionism became stronger. When Russia stops buying Belarusian goods and increases the gas price, the situation will become still worse. Aliaksandr Lukashenka, during his visit to Moscow, tried to avert rise in the gas price and to obtain an extra credit. Previously Siarhiej Sidorski, Belarusian Prime Minister, said that the Russian ruble could become the regional currency.
Russia raises the issue of recognition by Belarus of South Ossetia and Abkhazia’s independence. But Aliaksandr Lukashenka’s receiving what he wants for the recognition would mean that Russia is ready to pay a high price for its ambitions and emotions and that the Belarusian President knows the Russian authorities’ psychology well.
December 25, 2008
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Other materials on this topic
Hot topics
Digest
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22.12.2008
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RFE/RL: DISADVANTAGE LUKASHENKA, AS GAS-PRICE TALKS GET UNDER WAY IN MOSCOW
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As the Belarusian president arrives for talks on the price of Russian gas shipments in 2009, analysts in Minsk and Moscow alike say he is aware that he is headed to Russia hat in hand - and desperate for a sign of financial support from his powerful neighbor.
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Expert forum
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EU'S “EASTERN PARTNERSHIP” AND RUSSIA-BELARUS RELATIONS
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SVYATOSLAV POLKHOV
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18.12.2008
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Minsk has recently supported the EU’s new foreign-policy program “Eastern Partnership” and has already confirmed its readiness to formalize the program jointly with the European Commission, said Andrey Popov, spokesman for the Belarusian Foreign Ministry.
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EU POLICY TOWARDS BELARUS
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VALERY KARBALEVICH
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24.10.2008
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Several factors influenced the change of EU policy towards Belarus and the lifting of the sanctions for some Belarusian officials in the EU. But it is difficult to speak about the public opinion changes in view of the change in Europe-Belarus relations.
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THE OUTCOME OF THE PARLIAMENTARY ELECTIONS IN BELARUS
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SERGEY NIKOLYUK
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30.09.2008
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There is no sense in attaching superfluous importance to the last election campaign in Belarus. Previous Parliament drafted only one bill on its own for four years. All its activities were reduced to the acceptance of the Cabinet and President’s initiatives.
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WHEN REALPOLITIK IS NOT A REALISTIC OPTION
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VITALI SILITSKI
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30.09.2008
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The most predictable results of the parliamentary elections that took place in Belarus on 28 September 2008 were accepted as a great surprise and even a sensation in the West and partly even in Belarus.
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LUKASHENKA TRIES TO MAKE A CLEAR CHOICE
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PAVEL USOV
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01.09.2008
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The main question, which has arisen before the Belarusian political elite, is with whom they should build relationships, with the East or with the West. The current political situation indicates that Belarus has reached a geopolitical impasse.
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RESHUFFLES IN BELARUS
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VALERY KARBALEVICH
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18.07.2008
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The formal reason why the officials were fired is an explosion in Minsk on the Independence Day. It is clear that the explosion is just a pretext for such important reshuffles. If to proceed from the official version, it would be logical to sack the Head of the KGB and the Minister of the Interior. But that did not happen.
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Analysis
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05.11.2008
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BELARUS BRIEF: THE END OF ENP
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Eurasian Home with a kind permission of the Pontis Foundation publishes the Belarus Brief "The End of ENP" on the post-election situation in Belarus against the background of Brussels’ departing from its previous “soft” policy approach towards Belarus, encapsulated in the European Neighborhood Policy (ENP).
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29.07.2008
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PARLIAMENTARY ELECTIONS: BELARUSIAN TRANQUILITY, EUROPEAN INTRIGUE?
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Eurasian Home with a kind permission of The Belarusian Institute for Strategic Studies (BISS) publishes an article “Parliamentary Elections: Belarusian Tranquility, European Intrigue?” written by the BISS analyst Vitali Silitski. The article focuses on the intrigue of the parliamentary elections in Belarus.
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09.10.2007
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TOWARDS A NEW VISION OF BELARUS
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Eurasian Home with a kind permission of the Belarusian Institute for Strategic Studies (BISS) publishes synopsis of the international conference "Towards a New Vision of Belarus" which was held on September 10-12 in Kyiv, Ukraine.
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29.09.2007
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BELARUS BRIEF: COSMETIC SURGERY IN BELARUS: TOWARD A NEW REGIME
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Eurasian Home with a kind permission of the Pontis Foundation publishes analysis entitled "Cosmetic Surgery in Belarus: Toward a New Regime". In the light of the EU-Russia summit, the analysis offers a new look to the most important post-election development of Belarus.
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22.12.2006
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BELARUS BRIEF: HOW THE WEST CONTINUES TO LOSE BELARUS
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Eurasian Home with a kind permission of the Pontis Foundation publishes the Belarus Brief "How the West continues to lose Belarus" on the current situation in Belarus and outlining possible scenarios for the 2007 year.
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21.09.2006
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CURRENT TRENDS IN BELARUS POLITICS
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Eurasian Home with a kind permission of the Pontis Foundation publishes the survey on Belarus, entitled “Current Trends in Belarus Politics”. This survey deals with the leadership crisis within the United Democratic Forces (UDF), covers the preparation for the forthcoming local government elections in January 2007, gives insight on post-election developments of the regime and the democratic opposition after March 2006.
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26.05.2006
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BELARUS BRIEF: STATE OF THE UNION AND THE UNION STATE
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Eurasian Home with a kind permission of the Pontis Foundation publishes analysis entitled “State of the Union and the Union State”. In the light of the EU-Russia summit, the analysis offers a new look to the most important post-election development of Belarus.
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14.04.2006
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BELARUS AFTER ELECTION: THE NAKED DICTATOR
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Eurasian Home with a kind permission of the Pontis Foundation publishes analysis prepared by the Minsk-based Center for Political Education entitled “Belarus after Election: The Naked Dictator”. The analysis summaries the March events, draws conclusions from the reaction of authorities and the opposition and outlines the possible development for Belarus for the beginning of the third term of Alexander Lukashenka.
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Opinion
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SLEIGHT OF MOUTH
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| Aleh Novikau |
27.02.2008
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Aliaksandr Lukashenka has declared that in the nearest future he will devote his time to combating the “Iron Curtain”. By the ‘curtain’ he means the isolation regime which has been established by the unfriendly states around Belarus. One can interpret the Belarusian President’s statement in two ways. It is either he yet again decided to make it hot for the screen and jalousie lovers or he wishes to “remake” his own enclosure.
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WINTER IN MINSK
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| Jules Evans |
22.02.2006
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It looks like it will be another long, cold winter in Belarus. On Tuesday the 21st of February, armed KGB agents raided the homes of 10 young opposition activists in Minsk, searching their homes and taking them away for questioning. The activists were all members of Partnership, a Belarusian NGO which acts as an independent monitor of elections.
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Author’s opinion on other topics
“THE CUSTOMS UNION MAY BE THE LAST EFFORT OF RUSSIA TO KEEP THE CIS COUNTRIES TOGETHER”
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02 December 2009
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The documents establishing the Customs Union of Belarus, Kazakhstan and Russia were signed on November 27, 2009 in Minsk by Aliaksandr Lukashenka, Nursultan Nazarbayev and Dmitry Medvedev.
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RUSSIAN-BELARUSIAN RELATIONS AND THE CHISINAU CIS SUMMIT
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08 October 2009
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President of Belarus, Aliaksandr Lukashenka’s uncomplimentary words about the Russian-Belarusian relations and about Russian Premier Vladimir Putin personally have little to do with transformation of the CIS whose leaders will hold the summit in the Moldovan capital of Chisinau on October 9.
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HOW BELARUSIANS ASSESS CONFLICT WITH RUSSIA
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23 June 2009
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According to the public opinion polls, 90% of the Belarusians have considered Russia a friendly state. At present this figure can fall to 70%, this is the maximum, to which the national mass media criticism can lead.
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BELARUS-RUSSIA: OIL AND GAS MADNESS
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11 January 2007
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The oil conflict showed the extreme weakness of the regulatory framework of the bilateral relations between Belarus and Russia, lack of legal culture, and powerful potential for conflicts development.
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BELARUSIAN-RUSSIAN RELATIONS
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05 December 2006
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Aliaksandr Lukashenka has concentrated all Belarusian diplomacy and Belarus’ foreign policy on Russia. For the last 10 years Minsk has conducted explicitly unilateral foreign policy in order to win Moscow’s favor.
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VISIT OF PRESIDENT OF VENEZUELA HUGO CHAVEZ TO BELARUS
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28 July 2006
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Globalization influences not only the markets of goods, services and money. The authoritarian and dictatorial regimes have long been reaping fruits of the globalization, severely criticizing its major initiators, the USA being on top of the list.
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THE BELARUSIAN-RUSSIAN RELATIONS
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15 June 2006
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The issue of Gazprom’s gas price increase for Belarus has found a lodgment in the agenda of the Belarusian-Russian relations. Still, serious tensions have not yet emerged.
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GAS PRICES FOR BELARUS TO GO UP
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31 March 2006
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I believe that the myth of the Belarus-Russia Union is being destroyed, and the current scheme which was employed by Russia on drafting an agreement with Belarus about gas cooperation is nearing its end as well.
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BELARUS – RUSSIA: ECONOMIC COOPERATION
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29 March 2006
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If to judge about the Belarusian-Russian relations just by the crude figures of the Belarus’ trade balance, the two countries are definitely at a trade war.
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PRESIDENTIAL ELECTIONS IN BELARUS
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23 March 2006
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Aliaksandr Lukashenka has done his utmost to show Belarus and the world community that he is the only and indisputable leader of the country.
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BELARUS – RUSSIA: THE PROSPECTS OF INTEGRATION
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02 February 2006
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Regardless all Moscow and Minsk’s assurances about mutual understanding, progress and relationships improvement, the course of discussion and passing of the most important documents do show that the integration between Belarus and Russia remains on paper.
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POLITICAL SITUATION IN BELARUS BEFORE THE ELECTION CAMPAIGN
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27 December 2005
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The decision to hold presidential elections on March 19, 2006 was not a surprise for the Belarusian opposition. It was one of the predictable case scenarios, which depended on the development of relations between Minsk and Moscow . Aliaksandr Lukashenka could not be luckier. Being an experienced politician, he turned gas conflict between Russia and Ukraine to his advantage.
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BELARUSIAN - RUSSIAN RELATIONS AND THE PROSPECTS OF THE BELARUSIAN OPPOSITION
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21 November 2005
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The format of meetings is usually determined by two parties. Since Aliaksandr Milinkevich needs publicity (he needs to introduce himself, promote his team and his election program), it was definitely the Russian party, who had chosen not to advertise his visit. And it is logical. Firstly, it was the first high-level meeting of the Belarusian presidential candidate from democratic forces with the Russian policymakers.
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BELARUSIAN - RUSSIAN RELATIONS
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13 September 2005
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Lukashenka is aware of the fact that the Kremlin officials discuss various scenarios of Russia’s reaction to the upcoming political events in Belarus.
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A VISIT OF ALIAKSANDR LUKASHENKA TO MOSCOW
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27 July 2005
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Judging by the results, all the previous meetings of the Russian and Belarusian Presidents were formal rather than of fundamental importance.
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UKRAINE — EU RELATIONS
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27 June 2005
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The EU has refused to give Ukraine the status of a country with market economy. At the same time, the European Union officials made the decision to simplify the visa regime for the Ukrainian citizens. Why did Ukraine fail to obtain the status? The Belarusian economist Yaroslav ROMANCHUK answered this question.
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