Leu Marholin: Officials Cannot Influence Economic Laws

The economist has said why the head of the Lukashenka administration will not affect the price increase.

The Belarusian ruler has instructed Natallia Kachanava to take control of price increase. Economist Leu Marholin explains to Radio Racyja what will come out of it.

– There is not much that depends on Kachanava here, because the authorities worry about the increase in prices in word, and at the same time, they sign documents to increase them. The other day, a document was signed providing for an increase in excise taxes on fuel, and what does this mean? Fuel is everything in the economy, since the price of any product is based on its cost. If the excise taxes increase, the prices will rise. Whatever goods we buy, from bread to bicycle, the increased excise taxes will be included into the price. Therefore, I do not know the way for the administration head to solve the task.

– What other factors affect the price increase?

– Among other things, there has recently been an increase in the exchange rates of foreign currencies – the dollar and the euro, which means that all imported components are becoming more expensive. There is also a certain increase in salaries, and this also has a certain effect on prices. But these are the laws of the economy, which officials cannot affect.

– Will the rise in prices continue?

– I think there will be a slow increase, since economic reforms are not being carried out and are not foreseen in the future. And what is being done now shows that prices will continue to rise.

Besides, next five years, there will be an increase in the prices of raw materials for oil refineries, which means that we will have to continue to raise prices for fuel and everything else.