Economic growth without social shocks: Belarus President about 2016 budget

Economic growth without social shocks: Belarus President about 2016 budget

The Belarusian President, Alexander Lukashenko, held on Monday a major meeting to discuss the 2016 budget and future macroeconomic policy of Belarus.

External factors do not allow building optimistic forecasts. But Belarus is not going to go with the flow. There are still reserves. Belarus needs to mobilize all forces and resources. This is perhaps the main demand of the head of state.

Alexander Lukashenko, Belarus President:
Year will take place under tight budget constraints. We need to ensure macroeconomic stability, thus fulfill all obligations to the people. As promised, people is the priority of the economy.

Social policy in Belarus will remain unchanged. It will be optimized in some points but not at the expense of higher unemployment.  The principle is simple: give people jobs, control them and pay. Belarus' internal potential lies in increasing productivity and reducing costs, ramping up export, ensuing a trade surplus and strengthening Belarus positions in the domestic market. The introduction of new technologies and competent management of the enterprises should help achieve all this.

Alexander Lukashenko, Belarus President:
When the economy is in a difficult situation it is necessary to mobilize the known methods by which we can act, which we understand. We don't need any sorts of experiments. I need concrete sensible proposals that are understood by everyone. We don't need to reduce the number of indicators, I do not know why some of you want this. On the contrary, it is necessary to give more specific indicators. We offered local authorities to start to work a little bit harder and create more jobs. Then we will not run after them and tell them to call more investors.  And there will not be any unemployment, people will not be thrown on the street. And all the rest. Our economy is the selling of what we produce. In terms of the price factor, we are absolutely competitive. In terms of quality we are also competitive. And we can make those who can't work properly do it and start working better. Therefore, everything is clear: there are no miracles in times of crisis. We cannot, even if we want, create a new economy, that is, start producing something new instead of what we now have. We cannot, and do not need it. We have good people, good education, good industrial school. We just need to work harder.

Inflation in Belarus has reduced in 2015. Over 10 months, consumer prices have risen by 10.1 percent. This is lower than last year. The domestic foreign exchange market has also become more stable. The overall balance of the purchase and sale of foreign currency in Belarus is positive - $118 million. 

The exchange rate is determined by the market. Foreign exchange interventions are carried out only to smooth sharp fluctuations in the value of the basket. Belarus is paying off all its debts on time.

Indicators in the draft forecasts 2016 are optimal, the government and the National Bank say. They are not at all liberal. They are rather tough, but still real. Inflation will stand at 12 percent.

Andrey Ivanov, financial analyst:
The President said very firmly that we will not carry out any neoliberal experiments. It is quite right, because today we see such turbulence in the world. See what's going on. The United States, who live on credits, are returning their industry in the state's hands. Today, Russia is moving actively from the primary sector to recycling, so the economic structure is changing. Today, we also need to think about self-sufficiency and understand that all processes are interrelated and interdependent.

The Belarus President instructed to bring inflation down to less than 10%. By 2017 inflation in Belarus is going to be about 9%. Belarus also thinks that the barrel's average price will be 50$ in 2016. Today, it is lower but Belarusian authorities say they take these figures from the economic forecasts of its main economic partners. Similar figures were laid down in the budgets of other states. 

The Belarusian government understands that something may go wrong during 2016, be it oil prices or any other macroeconomic indicator. To this end the government has some extra measures that will let the country stay on its feet. 

The average annual value of the US dollar is projected at BYR18,600, said the National Bank.

Andrei Kobyakov, the Prime Minister of the Republic of Belarus:
The gross domestic product - an integral index, which determines the result of the economic performance - is going to increase slightly, by 0.3%, in 2016. This year, the pace of GDP growth will be less than 100%. We are waiting for a figure of approximately 96.5% in 2015.

The President approved the main parameters.

Time changes and Belarus needs to employ new methods of work in the new environment. The country has chosen to do without dubious experiments to minimize the risks. However, it doesn't mean that the country will sit and wait for crisis times to pass. It is going to develop its own economy taking adequate measures and putting forward realistic ideas and plans.