Barys Zhaliba: Lukashenka Sank Into Utopias

In fact, an even greater fall in real wages is awaiting Belarusians.

Doctor of Economic Sciences, Professor Baris Zhaliba said that in his interview to charter97.org, commenting on today's Prime Minister Andrei Kabiakou’s announcement, that the gross domestic product of Belarus decreased by 2.8 % in January-October 2016, compared to the same period last year.

– Why did the authorities decide to admit the GDP meltdown?

– Belstat gives us this information monthly. It gave the information for half a year and then added a month. It is calculated as follows: for example, if they have included October, then the produced GDP for 10 months of this year is compared with the last year’s data, of course, this indication changes. The power does not admit, but the National Statistical Committee keeps records and publishes this information, the Prime Minister simply stated it.

Another issue is that the government hoped to reduce the decrease of the GDP through Russia’s compensation of oil short-deliveries that had been on since July, but only if Belarus would repay the debt for gas before 21 October.

It seemed that the parties had agreed, but as practice showed, the debt was not repaid. Now it has become not less than 300 million dollars, so Russia will not compensate the short-deliveries for our oil refinery plants, and our GDP is highly dependent on the Belteftehim enterprises. Due to the fact that the plants are underutilized, the GDP continues to fall, and the government hoped that it would be not minus 2.8%, but minus 1.5%.

– What are the consequences of the GDP permanent decline?

– The real wages will continue to fall, our surveying during the year shows that the real disposable income has fallen by 7.2%, unfortunately, this trend will remain until the end of the year. There will be also job cuts, the deterioration of the financial condition of enterprises and so on.

Against the background of not implementing agreements with Russia on oil and gas, Lukashenka's statements about a $ 500 salary next year sound like a utopia.

This was said to cheer the people up, nothing more, it was something like “small consolation.”