Time has run out

The financial and currency fuss of the Belarusian authorities is approaching its logical end.

If at the beginning of the rouble-dollar soap opera the main characters – Mikhail Miasnikovich, Piotr Prakapovich, Nadzieja Jermakova – fooled the population according to schedule, ensuring that there was plenty of foreign currency, no one needed dollars and euro, the windows of currency exchange points are covered with spider’s web, and the dreadful 2011 has passed forever, then since June the Belarusian ruler has joined the performance in the ‘Everything is good, lovely marquise’ style. But any soap opera sooner or later ends.

It is symbolic that after his return from China, having spoken with the Prime-Minister Mikhail Miasnikovich, Lukashenka summoned the chairwoman of the board of the National Bank Nadzieja Jermakova. Apart from the usual rhetoric of everything being stable, ‘there is enough currency’, ‘banks carry out their functions’ etc., which dominated the dialogue, there were two key remarks of Lukashenka’s, which were then consciously reproduced by the state media:

“the population and companies must understand: the demand is high – the price is higher, no demand – the price is lower, this applies to a currency too. Money is too a merchandise”;

“we hope that at the meeting of the prime ministers of our countries (Belarus and China) it (Chinese unconditional loan) will be finalized”.

Even according to the most primitive logic it is clear that the two abovementioned conclusions fit each other the same way a one-inch nut fits a one-centimeter screw. It is clear that if the issue of a large Chinese ‘unconditional’ loan had been solved during the visit to Beijing, there would have been no necessity to say that the exchange rate of the Belarusian rouble is a subject to the market fluctuations and that it is the people themselves, who are responsible to the growth of the exchange rates of dollar and euro. It like he was saying ‘if you do not buy foreign currency, the exchange rate will be low’. Only why does the population need such a ‘cheap’ foreign currency, if it is not there for being bought, but only for its quotation to be admired. It is clear that the ‘cheap’ currency is necessary for the Belarusian state sector to pay for oil, gas, resources etc. And the population can live without it…

The scheme is clear and traditional. Lukashenka has already said everything that was needed: the devaluation is inevitable and the people are to blame. The ruler is, of course, has nothing to do with that. Moreover, he, like the former president of Egypt Mohammed Morsi, cannot stop looking for loans around the world. So we are, apparently, expecting one ‘unconditional’ from China…

It is worth reminding that the whole last winter, until 15 March 2013, the authorities told the philistines the endless exciting fairy-tale of the billions of dollars, which needed to be taken from Russia for the ‘modernization’ of the Belarusian economy. Russia’s complaisance was considered by default, and no one was even going to ask Moscow its opinion. The planned loan was even distributed. It was supposed to provide for the very notorious ‘safety net’ for the stable exchange rate of the Belarusian rouble. However, it is obvious that they were too fast to distribute the money. Moscow did not give the loan. Everyone, of course, has forgotten about the modernization. It is not a time for it, when the devaluation is approaching like a tsunami.

Immense loans from Indonesia and Qatar got lost somewhere in the sands of desert and ocean waters. The flow of Belarusian equipment to the UAE has also slowed down…

In the meanwhile, the situation with foreign currencies keeps getting worse, which, though, does no prevent the Belarusian authorities from playing the endless financial and monetary “Pinocchio” remake for its people…

For how long will this Belarusian monetary puppet theater go on? The population, torn apart between deposits in foreign and domestic currency, is being confused by monetary hotbed (high rates) one minute, and the pair of Jermakova and Prakapovich from the Land of the Fools the other.

According to indirect evidence, it will not last long. If the provision of the last tranche of the Eurasian Economic Community anti-crisis fund’s loan lingers, then we are 60-90 days from significant devaluation of the Belarusian rouble, starting from 15 July. It is clear that the Belarusian authorities are hoping for a fairy-tale miracle, but they do not even have little to seed the miracle money tree into the magical soil.

Andrei Suzdaltsev, politoboz.com