Lukashenka’s economy is bankrupt

The gross external debt has reached 22 billion, with Belarus’s stability boundary being 19 billion, economists say.

Belarus’s gross foreign debt increased by more than 45% amounting to 22 billion dollars, the report of the National Bank of Belarus says. Why does Belarusian leadership take more and more foreign loans? Can one agree with the authorities stating debt growth doesn’t threaten the Belarusian economy? Economist Mikhail Zalesski answered these questions to Radio Svaboda.

– The rate of foreign debt growth looks interesting. It increased by 7.7% in the first quarter 209, by 8% in the second, 9.5% in the third and 14.2 in the fourth. The tendency seems to be eloquent...

– The tendency shows that the state has chosen a slippery slope of accumulating debts. We can often see this in our life when one begins to borrow though he or she doesn’t’ have an opportunity to pay them. Such people begin to borrow more and more without a hope to pay off.

In my view, Belarus’s stability boundary is 19 billion dollars today. Under favourable conditions nothing can happen, but under unfavourable conditions the debt can influence the reputation and our economic future.

– The authorities can cams us down by saying the foreign debt is only 45% of the GDP, this is less than many European countries have.

– People say: while a fat man just loses weight, a thin man dies. There’s another problem: along with increase in foreign debt, our products are becoming less competitive. It is becoming less popular on traditional markets.

– Why the authorities did try to avoid incurring debts earlier, but now begins to accumulate debts?

– They count on national mentality. The Russians say water never flows under settled stones, the British say a rolling stone gathers no moss, the Belarusians say if you don’t move a stone, it gathers moss. The authorities decided we should wait till the crisis is over. So, if we are going to wait, we can borrow as much as we want.