Does Lukashenka ask for credit not to carry out reforms? :: Charter'97 :: News

On June 29 at the talks with the prime minister of Belarus Syarhei Sidorski the Russian side has set forth new conditions for getting a state credit from Russia. Russia insists on Belarus’ changing budget policy in such a way that that credit would become the last one. Belarus hasn’t recounted gas deliveries price in budget yet. As it turned out, the sum requested by Belarusian government, has grown from $1.5 billion to $2 billion. The Charter’97 press center has asked the former head of the National bank of Belarus Stanislau Bahdankevich to comment on this report:

“Conservation of a command-and-control system in economy requires more and more money for its functioning. The paradox is that we do not need to take an interstate credit for liquidation of a budgetary gap, as officially we have a budget surplus. However, we suffer great economic troubles, as the adverse balance in trade with Russia has reached critical amount,” Stanislau Bahdankevich stated.

The economist believes that the state can take credit only for compensation of budget deficit or for a large investment project, for instance for building a nuclear power station.

“If we speak about trade balance deficit, it is not a field of the state, but of a real economy. Its problems cannot be solved with the help of interstate credit. The adverse balance could be changed by the state less buying and more selling, because of the national currency devaluation, for instance,” Bahdankevich notes.

According to the former head of the national Bank, problems of separate plants, oil refining, oil and gas price hike, should be solved by methods of economy. “Administrative way of retention of prices for consumers causes huge debt to Russia. Foreign credits should be attracted via bank system for certain enterprises for realization of concrete investment projects which promise profits. Now some game at the interstate level should be taking place. The government wants to keep flagships of Belarusian economy without any reforming of the system. In order to support the economy, the Russian credit is needed,” the economist is convinced.

Bahdankevich believes that the today’s state should ensure preferential conditions for small and medium business. As for large-scale industry, it should be placed in market conditions, where plants would exist independently on their earnings and settle expenses by their profits. “If some enterprise has problems, it could sell some of its shares; take credit for a concrete project on modernization. Large oil refineries and gas transportation enterprises could establish consortiums, so that a Western and for instance Russian capital would own it jointly, uniting suppliers and consumers,” the expert believes.