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Six reform steps in Belarus proposed by Economy Ministry


The reforms consist of six main points. They were presented with a few remarks by First Deputy Economy Minister Aliaksandr Zabarouski.

As Zabarouski noted, the first paragraph refers to the measures aimed at ensuring the macroeconomic balance. This is an important and necessary condition for economic growth. He also boasted the first results.

"The main economic result of 2015 is the fact that Belarus, for the first time, had the best indicators of the balance of payments. The current account deficit of balance of payments amounted to 1.3% of GDP in January-August, and this shortage is normally financed on the loan free basis,"  said the Deputy Minister.

The second element of the "road map" of structural reforms is the increasing efficiency in the allocation of financial resources. It means that new Development Bank loans in 2016 will be allocated only on a competitive basis on the general conditions for all forms of ownership.

"In 2016, and this has already been decided, administration and the reduction of non-market loans will be put in order."

At the same time Aliaksandr Zabarouski announced some forecast figures for the next year: inflation will not exceed 12%, foreign investment will be up to 2.5% of GDP.

The third point referred to Aliaksandr Zabarouski was reducing the role of government in the economy. This means a reduction of state support and providing it through the competition, giving up loss-making activities.

"For the transformation of the public sector we will implement a multidimensional strategy involving reduction of state support, its representation based on market principles, as well as the restructuring of inefficient enterprises," says Zabarouski.

First Deputy Minister of Economy Aliaksandr Zabarouski said the fourth step of reforms was the increase in jobs in the private sector by improving the investment climate and reducing the tax burden of enterprises.

The fifth step was the development of the labor market and strengthening social protection systems.

"Today, it is to be understood that the labor market in Belarus is not going to grow. In the next five years, the number of the employed individuals will be reduced by 225 thousand people. This means that more people will be leaving employment rather than working. Just like in the Western Europe. There are two ways to do this: labor mobility and support of those who have lost their jobs temporarily," said the representative of the Ministry of Economy.

According to the official, the sixth step of reform is formation of efficient commodity markets and financial services markets. In particular, it concerns the reform of housing and communal services.

"De-monopolization and reduction of costs in the energy sector and public utilities should be linked to reform of the tariffs. Subsidizing the rich at the expense of tariffs which cover costs is wasteful."

On November 3, Presidential Aide Kiryl Rudy noted that there is no reason for  reform in Belarus in the the absence of external stimuli, the availability of money in the country and the lack of public demand for reforms.

But an international expert, Slovak MP and advisor to the Minister of Finance and Minister of Economic Development of Ukraine Ivan Mikloš said that the farther Belarus delays reforms, the more painful it will be for the Belarusian people in the future.

"You have to pay for the years, when you had  no reforms. Now reforms are taking place in Ukraine, and most people do not like them, because the reforms have not been conducted there long enough. But there is also good news: if the system hold far-reaching reforms - it will lead to quick results: the emergence of new jobs, production growth and reduced unemployment."

The expert also noted that in order to carry out reforms, the Belarusian authorities should take on a significant share of responsibility, although it is not ready to do it yet.

Photo: Fotolia