Leanid Zaika About Economic Crisis: Only One Person Is To Blame

Lukashenka is high maintenance for the Belarusians.

Economist Leanid Zaika in an interview for The Current Time estimated Lukashenka's negative impact on the Belarusian economy.

- Belarus does not need IT intrinsically at the moment. There are some romanticists who say: "We're going to improvise everything here now, we're going to make full IT, each riot police officer will get a smartphone and will be able to talk directly to the minister". IT - it's not our thing. IT specialists get orders, they work mainly for Western European partners, North American ones - Canada and the USA. IT specialists, if you look at the real situation, they have an hourly wage rate of 18 dollars. And they do not get less than one and a half thousand dollars. They can work in any country: they can go to Goa, they can go somewhere else.

IT specialists appeared in Belarus and stayed there for only one simple reason - Aliaksandr suddenly decided that something smart should develop in the country. He and the officials do not particularly need it.

About orders. I had my IT staff, the total potential of orders, which is supposed to turn out, is about 92 billion dollars. In the world markets. Russia does not order, Belarus does not order, so they can live in any country. The only thing is that they practically do not pay taxes - only the small ones. So the guys will move away, the companies will move away. I am going to say the following: they will do the right thing, guys, they don't need you here, they set men with batons against you right away, they can hurt you. Why do they need this IT with such riot police, with such power structures. Milk the cows, work without letup on the tractor from morning to evening - this is Belarus named after Comrade Lukashenka.

- Lukashenka says he has agreed with the Russian president on refinancing, says that "we will keep this billion dollars." Do you understand what it means to keep this billion dollars by making an agreement with Russia?

- I know very well that, first of all, people usually resent me when I say that Belarus' foreign combined public and private debt is $40 billion today. That is, a little more than four thousand dollars for each Belarusian. This year we have to pay only for debt service and its repayment 3.6 billion. I even once had to demonstrate what's going on in the way to make it clear to the common lumberjack, and [to explain that] with this money - our annual tranches for debt repayment - we could build a two-room apartment for every school graduate, give him the keys, so that he would already have a place to live.

Give Aliaksandr a billion, give him two billion - this is a moonshot attempt. He will simply spend it all on subsidized enterprises, on his collective and state farms. And these state and collective farms take 15% of the budget annually, and 15% of the budget is at least 3-4 billion. And so 3 billion have to be paid for foreign debts, 4-5 billion have to be given to state and collective farmers, agronomists. In total, it turns out to be 6-7 billion. This is the price of expensive Lukashenka. He is high maintenance for us. End of the line, there's no such thing as "more expensive".

- Lukashenka says again that he will not allow the national currency crash. I have talked to several people, everyone notes that as soon as he says so, this very crash necessarily happens. Do you think he will not let it happen this time?

- The matter is that by profession, I am the head of the Economic Theory Department, Vice-rector. And I have worked a lot in Washington, D.C., at the World Bank, at Moscow University, I have taught at St. Petersburg University, in Kiev University, in Tashkent University, in China. What is going on? There is an abecedarian disrespect of economic theory, i.e. foolishness, if translated into the language of average terminology.

Since the beginning of this year, thanks to Lukashenka's decrees and punishments, such voluntaristic decisions, the nominal salary has been increased by 8%. Nominally in rubles, at the current rate and so on. At the same time, the gross domestic product, the final cost of goods and services fell by 1.5-2%. That is, if a student answers at the exam: "I'll do it", then you safely turn him round and boot out: "Go, boy, study".

All of this is done here. Now what is he expecting? That he has increased the nominal monetary base, GDP is falling, and the exchange-value will fall according to the laws of science. The value of the Belarusian ruble is already declining by 10-15-20%. In other words, Aliaksandr confirms that the economic laws exist.

- The other day I saw the news on the Belarusian Sberbank website about limiting the acceptance of loan applications, and it was written in large print on the Technobank website that the consideration of loan applications is suspended. What does it mean for a common Belarusian?

- When the rate of the Belarusian ruble begins to fall, only a fool at the head of the bank can say: "Guys, keep lending." You take a loan, conditionally, for two, and then it becomes three. So you take 10 thousand dollars, and you have to give back six or seven thousand dollars. Any banker says: "That's enough, we don't play these games, because the rate has gone down. We'll give a loan in roubles (and we don't give loans in foreign currency), and we'll go bankrupt. That's why all the banks do it, and it's right, absolutely right, take it or leave it. Who is to blame for this? I think the main reason is that we should retire on time. One person is to blame - nobody else.