What can be done to ensure steady forward movement

Members of Government deliver economic report to the President on the first nine months of this year

Members of Government deliver economic report to the President on the first nine months of this year, with the National Bank, and the heads of Minsk and the regions, to inform forecasts for the budget and money-and-credit policy for 2015
By Vasily Kharitonov

Members of Government deliver economic report to the President on the first nine months of this year, with the National Bank, and the heads of Minsk and the regions, to inform forecasts for the budget and money-and-credit policy for 2015


Members of Government recommended not to take unenforceable obligations
Members of Government recommended not to take unenforceable obligations

Prime Minister Mikhail Myasnikovich, who delivered the basic report, noted that the economy has suffered from the wider global situation, including the position of main trading partners. However, some indicators are doing well, with GDP up almost 1 percent, and general output up just over 1 percent. Agricultural revenue is up slightly over 3 percent.

However, the President has demanded an accurate report, detailed point by point on what has been made and what has not. Before the year began, the Government defined working reference points and forecasts per quarter, so it should be possible to forecast the third quarter at this point. Of ten basic indicators, seven are outstanding: among them GDP, the rise in labour productivity, export volumes, the rate of inflation, and increased direct foreign investments — all key parameters.

The fall in solvent demand worldwide is well-known, aggravated by the rather fast devaluation of the Russian Rouble, leading to loss of price competitiveness for Belarusian goods. In receiving payment in Russian Roubles, our manufacturers lose in the Dollar equivalent, worsening their financial condition. Nevertheless, economic experts are able to understand the current situation, having a clear vision of how to proceed.

The meeting produced some useful debate and acute discussion of different viewpoints, with the Chairman of the State Control Committee, Leonid Anfimov, expressing various criticisms of the banking system. Other participants gave their opinions on the main problem: the high cost of credit. The Chair of the National Bank’s Board, Nadezhda Yermakova, noted that interest rates have recently fallen noticeably but admitted that further reduction is necessary. However, such a move cannot be undertaken too suddenly.

The Ministry of Industry has offered to create a special export bank to provide credit to foreign consumers wishing to buy Belarusian goods but the President asked what specifically would be possible to sell in this way and at what price. The Head of the Development Bank, Sergei Rumas, then admitted that, although funds for such operations exist, the idea has only been trialled once, to sell BelAZ machinery. In other situations, manufacturers have been unable to find reliable customer-borrowers.

Clearly, plans need careful thought, with strategies for 2015 financial and economic projects well considered. Of course, the budget was initially made under higher prices for oil than those existing today. The Russians are already correcting their main financial document and Belarus needs to do the same, to synchronise its budget.
Accelerated devaluation, following the Russian Rouble, is no longer being considered, since it gives only short-term effect. Moreover, our exporters buy many imported raw materials, materials and components. A fall in value for the national currency is a two-edged sword and the President is keen to avoid the public suffering. He has refused the Government’s offer to raise the price of vehicle fuel to the Dollar equivalent, urgently recommending that the Government seek elsewhere than citizens’ purses, rather looking to the oil refineries for the shortfall.

The State Control Committee also gave a report, with bankers asked to keep down their appetite for high salaries. The President has requested a clear hierarchical picture — from the Head of the National Bank down, with salaries appearing clear and logically, regardless of bank ownership.


The minutes of the meeting are to be submitted to the President by November 25th, but he has asked that some issues be further discussed, including domestic manufacturers’ priorities within state investment projects. The investment programme should be set out feasibly, since so many social and cultural sites are being constructed. Industrial infrastructure is to the fore and it’s imperative that every facility is working to full capacity, to ensure that good salaries are justified.

2015 is sure to be politically significant, yet the President urges that the election campaign should not become an occasion for unreasonable promises. Such a move only brings trouble. Any difficulties need to be recognised, so that they can be dealt with effectively; it benefits no one to hide our heads in the sand. Adaptation is vital, or there will never be progress.
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