Economist: Lukashenka Has To Be More Modest

Belarus could deplete another $ 1.4 billion because of the dictator's projects.

The governor of Belarus spoke not only for the modernization of Hrodna-Azot, but also for the construction of a new nitrogen plant, udf.by reports.

According to Ihar Liashenka, the chairman of the Belnautakhim Concern, the new plant will cost more than $ 1 billion, while the deep modernization of Hrodna-Azot will require $ 400 million. Will the invested money pay back?

Economist Barys Zhaliba is surprised by Aliaksandr Lukashenka’s decision. He was given a choice: either to carry out a deep modernization of Hrodna-Azot or to build a new combine.

"And he chose a third one: we will modernize the old one and we will build a new combine. I'm not an expert in nitrogen fertilizers, but he probably has to be more modest. A bird in the hand is worth two in the wood. Especially, as follows from Lukashenka's words, it is not clear yet to whom we will sell these fertilizers," – the economist says.

Barys Zhaliba adds that they made the same mistake during the modernization of cement plants. The authorities were counting upon the Russian market, but they opened their own production facilities, and the Belarusian plants’ price were not competitive. As a result, the cement and concrete were sent to the construction of MKAD-2.

A similar situation is with modernization in wood processing. Most of the nine enterprises that the Development Bank took into tow, remain unprofitable.

"The system of centralized modernization measures is untenable. They take budgetary money, convert them into currency, and tell the director: here are the millions, appropriate them and you’ll only try not to appropriate them. Everything is done under compulsion. And the enterprise has to be independent. It has to have owners, who calculate everything, risking their own pocket," – Barys Zhaliba says.

He also draws attention to the fact that despite all the failures during the previous modernization, the same officials work in the government. So why the result should be different this time?