Briefly:

  • The authorities understand that it is impossible to destroy the private sector, which accounts for 50 percent of the economy.

  • Precisely because many people left Belarus, official unemployment did not increase much.

  • There is no such thing as Belarusian goods going to the Russian market en masse instead of the European one.

  • The Russian economy may soon find itself in a situation of much greater decline.

— If we compare 2022 with previous years, put it in the context of the entire economic history of independent Belarus, how unprecedented are its results?

Are the 4-5 percent drop in GDP that will be recorded at the end of the year really an unusual phenomenon?

- Such a drop in one year is truly unprecedented and a record, we have not seen this since the 90s.

But, of course, the 90s had its own specifics, connected with the restructuring of the economy, a change in the social order.

So this year, the biggest economic upheaval of this century took place in Belarus.

Ekaterina Barnukova

It was a big shock from the point of view of falling GDP.

But it should be noted that this fall did not affect people's well-being so much.

We are not seeing a big increase in unemployment.

Therefore, we can say that in this aspect, Belarus feels better than in the crisis of 2015-2016.

- What is the secret, how did it happen?

Why, as sociology shows, with such a fall in GDP, people do not feel a big economic shock?

Despite the fact that the real incomes of the population are falling, taking into account the record inflation.

Maybe the whole point is that the exchange rate of the Belarusian ruble remains stable, and this affects the psychological perception of Belarusians?

- You are absolutely right in that Belarusians tend to perceive the ruble exchange rate as a kind of beacon of economic health.

The exchange rate is stable and people are optimistic.

It helps the economy because they spend more, they don't go into austerity mode.

The exchange rate is stable, because the sanctions led to a sharp drop in imports.

The same thing happened in Russia, where the ruble strengthened, and the Belarusian ruble strengthened with it.

At the same time, real incomes of the population decreased by approximately 4 percent in 2022. Nominal wages increased, but inflation ate it up.

And this drop in real incomes is distributed very unevenly.

There are spheres where real wages have grown, and in some they have fallen very significantly.

And it turned out that incomes fell where they were the largest — in oil refining, potash mining and the IT sphere.

Even if there is a drop of 15-20 percent, it does not lead to the limit of existence.

- Is there a certain "equalization" - the rich get poorer, and the poor stay where they are?

- It turns out like this.

However, this fall is very unevenly distributed between the private and public sectors.

Against the background of the pressure exerted on private business (increased taxes, price controls), inequality along these lines - the private and public sector - may grow.

- Can we say that there is a certain process of "revenge" of the state economy?

Or is it more political rhetoric than concrete actions?

- Something average.

On the one hand, the authorities understand that it is impossible to destroy the private sector, which provides half of the Belarusian economy.

But if until 2020 there was an assumption that we are developing the private sector and it becomes a source of growth, then after August 2020 the regime became clear that the growth of the private sector carries political risks for the regime.

The government cannot destroy it, but it will no longer support it.

And if there is a question that something needs to be squeezed somewhere, something more should be taken from someone, then they immediately go to the private sector.

There is no longer a favorable climate for the private sector, but the danger of getting behind bars, which has always been there, has now significantly increased.

— The migration from Belarus of highly qualified and economically active people, these tens of thousands who left the country - IT experts, businessmen - what will be the impact on the future of the Belarusian economy?

- Undoubtedly, it affects the economic perspective.

But specifically this year, this migration made a short-term "positive" impact.

Due to the fact that many people left, official unemployment did not increase much.

But when people who are economically active and of working age, who paid taxes, leave the country, which already has an aging population;

if those who have shown a certain civic activity leave, then from the point of view of the potential of the Belarusian economy, this is, of course, a big loss.

- One of the main aspects of 2022 is the sanctions that were introduced immediately after the start of Russia's war against Ukraine.

What was their effect, how will it continue and what will it depend on?

- These were, indeed, very harsh sanctions that affected the main export items - oil products, potash, wood, metals, plastics, which were very important for our European exports.

In addition, Belarus immediately lost virtually the entire Ukrainian market.

Now, after the first shock and a huge drop in the spring and summer, we are seeing a certain increase in exports to Russia and in other directions.

But this growth is mainly due to the increase in prices.

There is no such thing as Belarusian goods going to the Russian market en masse instead of the European one.

Our woodworking, metals, and plastics are not particularly needed in Russia, there is enough of it there.

But food prices have risen.

In addition, the Russian ruble has strengthened - and our exports are becoming more profitable.

Due to this - price and exchange rate factors - the increase in export revenue is taking place.

- What is the forecast for next year?

Ruble exchange rate, GDP, exports, sanctions?

- It is necessary to list those factors on which a lot will depend.

We see that an embargo and a maximum price for Russian oil are being introduced - and the Russian ruble is starting to weaken.

If the government does not devalue the Belarusian ruble, then we will lose our price advantages in exports, we will receive less for the same export volumes.

Further, food prices in the world are also starting to decrease.

It also jeopardizes plans to increase exports to Russia in monetary terms.

In addition, the Russian economy may find itself in a situation of much greater decline, as the main sanctions against Russian exports are just beginning to take effect.

This will affect Belarus as well.

On the other hand, Belarus can take advantage of Russian military mobilization.

There are military enterprises, light industry (to clothe the Russian military), food industry (to feed the Russian military), and oil refining.

But the question is to what extent Belarus will be allowed to receive these supplies.

The next factor is what will happen to the sanctions next year, whether they will be extended or not.

There is still room for expansion - both in the banking sphere and in the transport sector.

It will depend on whether Belarus enters the war.

If we join, the economic situation will obviously worsen.

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  • Vitaly Tsygankov

    Vitaly Tsygankov graduated from the Faculty of Journalism of BSU.

    One of the two founders of the first non-governmental news agency BelaPAN.

    He worked in "Zvyazda" newspapers, was a correspondent in Belarus of the Russian "Nezavisimaya Gazeta", Associated Press, columnist in "Svaboda" newspaper.

    On Belarusian Freedom since 1994.

    Correspondent of Russian Freedom in Belarus.


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