Zlotnikau: “Situation of 2011 may repeat in Belarus”

A negative balance of trade in goods exceeds one billion dollars having increased by 400 million in April.

What are the reasons for a sharp decline in Belarus's export? How can it influence the Belarusian ruble rate?

Economist Leanid Zlotnikau gives his answers to Radio Svaboda.

“If we look at previous years, except for 2012, we can see that the country always had a negative trade balance. For example, it was -2 billion dollars in the first quarter of 2011. Over the history of independent Belarus, it has always had a negative balance of trade (except for 2005).

What happened last year? The country had a business on thinners and solvents last year. This 'phenomenon' gave a positive trade balance, especially in the first six months of 2012.

When the 'phenomenon' was over, everything returned to its place. Belarus again has its usual negative balance of trade,” the expert says.

It may have an impact on the rate of the national currency.

“There will be a significant outflow of foreign currency from the country. I wrote in my forecast published at the end of 2012 that without privatisation or new loans the outflow would be higher than the inflow. The situation of 2011 may repeat.

Only 360 million of the government debt was paid off in the first quarter of the year. The country will have to pay 3 billion owed by Belarus, its enterpirses and banks. No new loans are expected so far,” Zlotnikau says.

Russia traditionally remains the main sponsor ( in different forms) of Belarus's economy. Now, when many exports both in Russia and abroad, say about a decline of Russia's growth rates, should we trust these forecasts? How can it affect the aid to Minsk?

“We should trust such forecasts for Russia's prospects. Russia's main sales market is the European Union that expects a recession. The situation in Russia has been worsening since the second half of 2012. A further slowdown in Russia's growth rate and even a recession is expected. Of course, it will influence the Belarusian economy.”