Nezavisimaya gazeta: Specialists fleeing Belarus

Russia’s joining the WTO in the conditions of the Single Economic Space brings risks for the Belarusian economy.

Lowering of customs tariffs would weaken the position of Belarusian goods at the Russian market, and skilled personnel’s drain is going to happen through open borders to Russia, Nezavisimaya gazeta writes. Economy minister of Belarus Mikalai Snapkou has stated that only salary rise at least thrice by 2015 is able to make Belarusians stay in their home country.

The fact that Russia’s admission to the WTO could mean a problem for Belarus, was admitted by the representative of Belarus at the Eurasian Economic Commission, Syarhei Sidorski. The former head of the government of Belarus complained that Russia and Kazakhstan held negotiations with the WTO behind the closed doors, though earlier they promised to defend common positions of the customs “troika”. “Unfortunately, today we are facing the fact that they will join the WTO with lower customs tariff,” Sidorski said. It followed from his words that Belarus expected some compensation for possible losses. “We see that the Ministry of Economic Development of Russia has started to actively work on compensation mechanism. The main thing is for these mechanisms to be available not only for economic entities of Russia, but for Belarus and Kazakhstan as well,” Syarhei Sidorski noted. To his mind, national governments should start discussing these compensation mechanisms immediately.

We remind that earlier Belarusian officials, who spoke on the issue of possible threats after Russia’s joining the WTO, stated that customs tariffs of the Single Economic Space were discussed after Russia agreed upon them with the WTO. And it means that there were no risks for Belarus in that. Independent experts and representatives of business have never shared this optimism however. According to estimations of experts of the Research Centre of the Institute of Privatization and Management, the threat mostly concerned such fields as agricultural machine-building, food and light industries. In particular, the average weighted customs tariff for industrial goods is to drop from 9.5% to 7.3%, and from 13.3% to 10.8% for agricultural goods. “Our enterprises have a serious reserve of profitability,” said representatives of the Agriculture Ministry in response to warnings of experts.

Economic entities themselves and their associations raised alarm long ago. Understanding that their opinion would not in any way influence the political decision of the current regime to enter first the Customs Union with Russia and Kazakhstan, and then the Single Economic State, they asked the government at least to loosen administrative grip. Being more mobile and free in taking decisions, they would increase their chances to withstand the aggravating competition. So far these requests remain unheard by the authorities.

Mikalai Snapkou has turned attention to another problem, which is caused by joining the Single Economic Space, and which has already manifested – a skill drain from Belarus because of lower salaries. As said by Snapkou, it would be possible to keep the local skilled personnel if salaries would be raised to at least 80% of those in the neighbouring states. In particular, according to him, the average salary in Russia by 2015 is to become equal to $1300 according an optimistic scenario, and $900 under the pessimistic scenario. Even proceeding from the second variant, Belarus requires threefold salaries growth. At the same time experts, both international ones represented by the IMF, and local ones, state that there are no conditions for Belarusians’ income growth, and an artificial pumping up of salaries, as it were before the election, can cause another inflation round and devaluation. It was stated also by Alyaksandr Lukashenka yesterday, by the way. “Recently I am observing that people and labour collectives are more and more often bringing up an issue of wage rise,” he said. “We have agreed firmly that if workforce productivity and sales grow, you can go ahead and raise wages. No increase – no pay rise,” the president stated. As said by Lukashenka, deviations from this principle could “result in repeating the recent financial and economic crisis, which has taken toll on us.”

We remind that the only, but rather substantial plus of joining the Single Economic Space in the middle-term future is low costs for energy resources. However, experts warn that in case Belarus would not start reforms, would not abandon directive economic management and a race for the GDP at any cost, this plus is going to turn into a minus, as it increases dependency on Russia. The latest plans of the Belarusian government do not offer grounds to think that they are going to adjust their economic policy.