Stanislau Bagdankevich: Minsk may encounter huge problems :: Charter'97 :: News

Minsk is in position to pay for the delivered gas but it needs outside borrowings badly. That may postpone the crisis for 3-5 years but also cause the problems with repayment of the debts which are to be allocated not for reforms but for furtherance of the inefficient economics. That was told by the economist, former head of the National Bank Stanislau Bagdankevich to the Russian periodical “Vremya Novostey”.

-Why the Belarusian authorities have so persistently refused to repay the debts for gas deliveries to Russia?

-To my mind, there are no force majeure circumstances preventing the debt repayment. If the Belarusian statistics is true to fact than the economic stat-of- affairs is up to the mark-the GDP growth has exceeded 8%, the budget is being implemented with proficit, the gold and cash reserves are growing. Evidently Minsk‘s calculations have relied upon the supposition that Moscow which previously gave in regularly will give in this time either. Gazprom used to promise transferring to the world prices and gas switching off but never did it. Even when at the beginning of the year the Russian monopolist increased the price up to USD 100 it didn’t insist on full-value payments for the gas.

-The experts forecast the economic crises in Belarus due to the power resources price-hike. How do you treat those forecasts?

-The price risen up to USD 100 per 1000 cubic meters and perspective switching over to the world prices in the four year period are quite reasonable. But to survive the power sources price-hike the Belarusian economy needs complex reforms. The present economic policy of Minsk created a dangerous situation. The Belarusian economy is rich in debts –since the beginning of the year the volume of credits granted by banks to enterprises has grown by 60%.
Other alarming tendencies have become evident-the negative international trade balance growth, accumulation of the output stock .All those facts create a threat of economic collapse. That is the reason for Minsk desire of making outside borrowings .Thus it may postpone the crises for three-five years but also cause the problems with repayment the debts which are now intended to be allocated not for reforms but for furtherance of the inefficient economics.

- To which extent is the Belarusian economy dependent on Russia?

-The dependence is extremely high because the Russian market still remains the major consumer of the Belarusian goods. Now they use to say in Minsk about the growing export to the EU countries, but actually petrochemicals and potash fertilizers are supplied to Europe. Machine tools, TV sets , light industry output are still being bought by Russia. If it turns down the Belarusian goods Minsk may encounter huge problems. The Belarusian authorities started talking about the necessity of being economical, but the energy consumption of the GDP remains much higher that in the neighboring Lithuania and Poland.