13 December 2017, Wednesday, 13:57

Leanid Zlotnikau: A New Wave of Crisis to Come to Belarus from Russia

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Source: cartoon.kulichki.com

But there is a way out.

Belarusians were told many times about the "special way" and the "socially-oriented" economic model. People fond out the hard way how it was "socially oriented", when the unemployed Belarusians received "letters of happiness", food prices drove up, and "innovators" in offices said that Belarusians would have to pay a 100% for all housing and communal services.

Or maybe it was not necessary to discover America and instead of the "Lukashenka's miracle" to take advantage of the experience of reforms in neighboring countries? Economist Leanid Zlotnikau tells Charter97.org what absence of economic reforms in Belarus can lead to.

- The authorities announced the establishment a research center on housing and communal services in the National Research Academy of Belarus. Lukashenka holds meetings on problems in the sphere. Should the state interfere with such questions, or should it be the prerogative of the private business?

- If we look at the experience of our neighbors, everything will fall into place. In the same Poland, Lithuania, Latvia, private firms are engaged in the construction, sale of real estate, repair, rendering of public services. As a rule, the state does not interfere in this sphere, these issues are handled by the private sector. And this system is much more effective than in Belarus.

I can cite an example without any theory. When St. Petersburg had the first enterprises that were engaged in the rendering of public services, immediately it turned out that the price for utilities was much higher than for the same services in countries with market economies. World experience shows which system has the right to life. And then you do not need to reinvent the wheel.

- We are constantly being told about "reforms", "modernization" of industry, "liberalization" of the economy, but there are no results. Why?

- We already have the experience of "modernization", which did not have any effect with significant investments. Funds were invested in the agriculture and in the industry, the housing and communal services sector undertook attempts of reforming. But it was fruitless.

All this happened because such reforms were done by wrong people, and our system is not effective. After all, it is not a market one. And one does not need to talk about a special "Belarusian model". We deal with the usual command economy: plans at enterprises, "five-year plans", there is no private ownership of land and other things. The system bears investments, efficiency of public services. Everything is interconnected.

- It turns out that we do not observe any reforms. What are possible consequences?

- Under the command economy certain activities are performed by the authorities and they will not bear any effect. We can observe what the lack of reforms can lead to. This is especially noticeable in terms of the last year: the living standard of Belarusians suffered a drastic decline. This impoverishment began two and a half years ago.

The growth of the world economy eased the situation in which the Belarusian authorities found themselves, but the essence of the matter remains the same.

The Belarusian economy is directly dependent on the Russian one, and all economists say that stagnation is waiting for Russia. The same fate awaits the Belarusian economy. There will be no growth, and it's dangerous. And the lack of reforms will directly affect the standard of living of the population.

- If current leaders do not want to engage in reforms, it will be done by people who will replace the current government. How can we facilitate the transition of our country to the track of the market economy?

- It's very simple, because such a transition is already taking place in the Baltic countries, Eastern Europe, and some countries in Asia.

Even Kazakhstan realized that it was necessary to replace direct management with the market economy. The most important thing in such transitions is that activities of the state must be subordinated to laws of the economy. This simple formula should be taken as a rule.

It will be easier to perform in Belarus because these transformations have been experienced by other states. We can no longer confine ourselves to our internal forces and simply give freedom to entrepreneurs, it's time to make the economy open, to attract foreign investments. We need to follow interests of the authorities, and put forward the principles of the economy. Then we will see changes.

The difficulty is that there is the scope of persons who have a lavish lifestyle under this system.

Former Finance Minister of Russia Alexey Kudrin says there are two questions to answer for yourself: first, what prevents entrepreneurs from working, and second, what is the obstacle for the inflow of investments. And then these obstacles should be removed to make the economy work. But such reforms are not possible without political changes.