Leanid Zaika: Redenomination Under Lukashenka Is Like Cruise Missiles In Savage’s Hands

The upcoming redenomination of the Belarusian ruble won’t result in the recovery of the Belarusian economy.

Such an opinion has been expressed by an economist Leanid Zaika in his interview to charter97.org, as he discussed the topic of the possible consequences of the redenomination scheduled for July 1, 2016.

- The two previous redenominations in Belarus “saved” the Belarusian ruble, but not for long – just in a few years “zeroes” were added again. Should Belarusians expect the same after the third redenomination, announced by the authorities?

- Redenomination is necessary, as just 2 or 3 countries with such astronomic dollar/local currency ratio are left around the world. It is simply embarrassing – to know that one dollar costs 17,500 Belarusian rubles.

For the last 10 years I have been repeating that redenomination should be held. Now the dollar is to cost 1.75 – 1.8 rubles. It should have been the starting point.

But redenomination itself, if it is just implemented and then people continue to relax, thinking that now the dollar costs 1.8 rubles, won’t yield good results. Redenomination should be followed by a tight money policy. A “no-nonsense” economic policy should be pursued.

That is why, touching upon possible consequences of redenomination, I would say: any good idea could be shot down. I hope that after 20 years the government is finally to “come to senses.”

- To your mind, are the authorities in power able to carry out economic reforms, in order to use the positive effect of redenomination? Or they are rather likely to “shoot the good idea”, as you have said?

- I find the word “reforms” here so inappropriate, that it is even ridiculous. It has turned into a kind of a mantra. Let them guarantee at least sensible economic policy, not reforms. What kind of “reforms” could we have, when the GDP of Belarus has shrunk by 3%? They should at least learn to implement economic policy professionally, and not to play child’s games.

Are they going to pursue such a policy? If a pair of state officials is ousted – it could be done by new young people, professionals, for sure. A pensioner Lukashenka and a pensioner Miasnikovich should understand: it’s time to step aside.

- And what about the near term? Redenomination is to be held on July 1, 2016. What could happen right after the redenomination in 2016?

- Nothing is going to happen, if extra money is not printed. It should be written in capital letters on Lukashenka’s office: “First of all: guys, do not print so much money. Secondly: do not give cheap credits to state-owned enterprises. Thirdly: study the real state of affairs.”

If I take a take a cruise missile and give it to a group of savages, and a group of well-prepared people – who is going to use it better – barbarians or experts? I recall that after Suleiman Kerimov offered a bribe of $5 billion for Belaruskali, Lukashenka said: “Does he takes us for Papuans?”

It’s high time to end with being barbarians, we should transit to rational management of the economy. No more being barbarians in our country.