Leanid Zaika: On January 1, I Would Dismiss Entire Leadership Of Country

Life in Belarus can change completely.

Economist Leanid Zaika, the head of the Strategy analitical center, summed up the economic results of the year in an interview to Charter97.org.

– In your opinion, what was the most important, decisive for the Belarusian economy in the departing year?

– There was a very serious moment in 2018 related to the violation of economic proportions in the country by the authorities.

The Lukashenka government is actually pursuing a destructive policy: due to its directives, nominal wages are about six times higher than GDP growth.

The year 2018 differs from the previous ones in that some decisions were made at the highest level that created a “time bomb” for the future – for 2019 and 2020.

In order to achieve his surrealistic goals, Lukashenka has broken the most important economic proportions – between production and consumption, between income and expenditure.

Therefore, the year 2018 turned out to be absurd and wrong-headed from an economic point of view.

Let me remind you that since 2015, our economy has fallen by 40%, and the wages have decreased by half. In 2018, the authorities have started some feverish actions that led to the devaluation of the ruble within an inch of unacceptable.

In addition, we have to pay 3.5 – 4 billion dollars to service the debt. This is a very hard amount for Belarus. The loans were taken absolutely irresponsibly. Next year, we will also have to pay huge debts because of this – about 4 billion dollars.

Besides, Lukashenka’s personal difficulties have been added to all this. Russia has very sharply put him on heels: either you yourself decide your financial issues, or you are not a ruler, but just a patron of your nomenclature.

Summarizing, we can say: it was a year of our steady movement into an economic dead end.

– It is clear that forecasts are a thankless task, but what will happen with the Belarusian economy in 2019, if we proceed from the assumptions laid down in the current year?

– Nothing important will happen, because economic policy does not change. We will have to pay the debts, we will have to go for a depreciation of currency again. To depreciate the Belarusian ruble at the level of 5-6%. This is very bad.

The Belarusian ruble is no longer an interesting monetary unit. We are back on the foolish way of the 90s.

The second point is competition, which will only increase. We can already see huge losses of Belarus in the agrarian market. Our traditional products, such as cheeses, dairy products, do not have an adequate market.

It was only one thing that saved the situation: the productivity of the agrarian market fell. Further, we will observe the following picture: it will be necessary to raise tariffs for utilities, for heating, and energy resources. The population will not be enthused over such prospect.

The next moment: they will not be able to raise wages unjustifiably again. We will observe low volatility, weak income movement. The year will be as quiet and unremarkable as the current one. There will be no high hopes.

As for industry and engineering, the Russian market is growing by 1.5%, which significantly limits our prospects. It is possible that these 3-4%, which we have seen this year, as I predicted, will not be there in 2019.

Competition is growing in foreign markets. Negative processes are taking place in global finance. Here, most likely, there will be a noticeable China and Russia’s departure from the dollar, the formation of a new monetary reality. Belarus is not a player in this field. It is not even a spectator, but it listens somewhere near the stadium to other players kicking the ball.

I don’t expect there will be any special decisions in the sphere of privatization and distribution of property. The authorities have not decided what will be given to whom. In previous years, the Belarusian property was given to persons hailing from the mountains. For example, Mikhail Gutseriev, a Derbent boy, Suleiman Kerimov. These “mountain people”, quite possibly, will start attacking Lukashenka again.

As for investments, due to the fact that the level of foreign and domestic investments fell dramatically in the ill-fated years, there can be no recovery in the economy. Full stop.

– If you had the opportunity to miraculously change something in the Belarusian economic policy on January 1, what decisions would you make?

– It's all very simple. On January 1, I would force to resign the entire leadership of the country, and then I would buy a ticket and go to the Canaries. The regulation of the economy I would leave for later. There is no need to intervene in economic life. Belarus is very bureaucratic.

One of the most important decisions should be a ban for checks. It is necessary to stop disturbing enterprises, to bar officials from even approaching the door. The pressure on small and medium business should be stopped.

The second solution is to go back of subsidizing our industrial enterprises, especially of those, in which money has already been invested: the cement industry, cloth, worsted industry, etc.

That would be enough. There is no government, it is on the beach. Since we’ve removed the bureaucratic tool – there is a new economic environment. On January 2-3, I would close the ministry of commerce, the ministry of economics, and instead I would create a National Bureau of Economic Policy.

But the main slogan, which should be there in every city, in every street, is “Leave People Do It!”.