Leanid Zlotnikau: There is no doubt that the current economic system ends up in a failure

What will the future autumn bring in for the Belarusan economy? What is going to be with the prices, salaries and exchange rates?

Citizens of our country have every ground to be pessimistic about the forthcoming autumn. Such opinion in the talk with the EuroBelarus Information Service shared the economist Leanid Zlotnikau. According to him, “Belarus lives in the regime of devaluation, and many people get the feeling that our economy is just about to collapse”.

Not only common Belarusans, but also the experts are not afraid to have their categorical say about the future of Belarusan economic situation. Thus, Siarhei Balykin, the head of the Association of Small and Medium Business, stated that recent situation with Belarusan economy is appalling.Leanid Zlotnikau believes that this assessment has a right to exist: “We can avoid failure only if some drastic change in the economic and political system of our state happens”.

The expert suggests taking privatization for an example: “There will be no success with privatization if there is no acquis communautaire aimed at protection of private property and conditions for business. It is only after these conditions are fulfilled when the state will be able to get some profit and count on loans from IMF, loans from stabilization funds and get involved in bonds issue. And if there is no changeover to market economy, the collapse of today’s Belarusan economic model is inevitable”.

Accessing the most morbid concerns of the population, the economist believes that serious change of the ruble-to-dollar rate can be avoided only if the state fully changes its economic course and if privatization processes starts, so that the country starts getting big transfers. “Everyone is well aware that today’s ruble-to-dollar rate in Belarus is artificially contained, as it is part of the National Bank’s policy. We also know that flight of capital from the country in July equals 1 billion dollars and it will be approximately the same. It means that the inflow of currency should be comparable, otherwise devaluation starts and no gold and foreign currency reserves will save the situation”.

Leanid Zlotnikau is sure that “the situation will be repeated. And in case flight of capital exceeds the inflow of currency, then the fears of the population will come true, i.e. devaluation, increase in prices and decrease of purchasing capacity. If the state doesn’t change its policy, there is high possibility that our country develops according to such a scenario”.

Still, the expert believes that there is no concrete answer to the problem of economic crisis in Belarus: “Although the prompt crush of economics in the country still can be avoided, the possibility of it remains high”.