“Not a Step Forward!” :: Charter'97 :: News

“This year will become a year of protecting our population from its own government,” – promised yesterday Alexander Lukashenko, whose speech before the governmental meeting, dedicated to the outcomes 2002, was abundant in promises of soon improvements in the social sphere. The head of state publicly demanded to halt price-growth in public utilities, transportation and also review the size of payments in healthcare and education. “Not a step forward in price-growth,” – came up Lukashenko with another of his mottos. Meantime, the introduction of tariffs in healthcare and education last year had been personally encouraged by him.

Belarusians’ standard of living fell over the past year. Lukashenko confessed that this partially happened due to inflation, whose rate reached 34,8%. Upon the outcomes of this year the government intends to bring it down to the level of 18-22%. IMF experts point out that the level of inflation in Belarus is highest of all CIS states. The head of the IMF mission for Belarus Thomas Richardson deems that high inflation is another form of a tax, due to by paid by the poorest population’s strata. Mr.Richardson underscored that it hinders the direct foreign investments’ influx into the economy of the country.

As claimed by IMG envoys, the Belarusian leadership must give up inflation crediting of the housing construction and ineffective backing of agriculture and industry.

Richardson received an impression that the Belarusian government is unprepared to conduct a strict fiscal and budget policy, which would significantly ease the taxation burden. At least that was the main point of argument between official Minsk and IMF, which prevents the organization from earmarking to Belarus a long-promised stand-by credit.

IMF officials assume that contraction of expenditures at the cost of diminished social programs must be carried out quite carefully. In particular, they proposed to set up a special budget fund, which would accumulate means, earned through privatization. Then this money could be used for long-term programs, including the pension fund’s reformation. The Belarusian government hasn’t yet responded to that proposal.

Thomas Richardson commented on the course of the petroleum industry privatization by saying that it would be more beneficial if the government attracted internationally recognized experts to evaluate it first.