Belarusian exports hit the bottom
On October 31st, Belstat published the January – September 2013 foreign trade data.
Belarus’ foreign trade is highly dependent on a narrow range of exported goods. Export growth potential is insignificant. Although modernization has partially improved export opportunities, any positive effects have been offset by growing exports of equipment and ill-conceived business plans.
In September, the foreign trade in goods deficit was USD 484.5 million. The main reason for this was a decline in exports to USD 2.925 billion, the lowest level since February 2011. The decline in exports was due to the drop in Belarus’ main export items – petroleum products, potash fertilizers and machinery. Production of petroleum products directly depends on the volume of supplied raw materials for processing, and in the case of Belarusian-Russian conflicts, the latter exerts pressure by limiting the oil supply to Belarus. Exports of potash fertilizers have suffered after the breakup between Uralkali and Belaruskali and will not be improved because the market prices keep falling. Mechanical engineering is dependent on the Russian market: the drop in investment demand from major customers has resulted in a sharp drop in sales, which cannot be compensated by sales in other markets. Other export items are too insignificant to affect the overall picture.
For instance, Belarusian dairy products are in great demand on the Russian market in 2013. Dairy exports are constrained by the shortage of raw materials to produce milk powder, casein, and cheese. Sugar has high export growth potential due to poor harvest in Russia. In addition, Belarus has started producing Chinese cars – Geelly, with a clear orientation on the Russian market in the future. However, even if Belarus increases exports of these items and earns up to USD 200 million per month, this will not be enough to remedy the situation.
The industrial modernization was held to expand the range of export products and their exports on foreign markets. In some cases, it worked out: for example, with some Grodno Azot products or chipboard exports. However, these are rather exceptions than a rule. Most often, modernization has resulted in increased imports of production equipment and negative output.
Modernization in Belarus has failed to diversify exports. Belarus needs not only new technologies, but also new managerial approaches, which are not feasible in the current environment.
President Lukashenka continues to rotate staff and rejuvenate heads of departments and universities following new appointments in regional administrations. Apparently, new Information Minister Karliukevich could somewhat relax the state policy towards the independent media and introduce technological solutions for retaining control over Belarus’ information space. New rectors could strengthen the trend for soft Belarusization in the regions and tighten the disciplinary and ideological control over the student movement in the capital.
President Lukashenka has appointed new ministers of culture and information, the new rector of the Belarusian State University and heads of three universities, assistants in the Minsk and Vitebsk regions.
The new Information Minister Karliukevich is likely to avoid controversial initiatives similar to those former Minister Ananich was famous for, however, certainly within his capacities. Nevertheless, the appointment of Belarusian-speaking writer Karliukevich could be regarded as the state’s cautious attempt to relax environment in the media field and ensure the sovereignty of national media.
The Belarusian leadership has consolidated the trend for mild Belarusization by appointing a young historian and a ‘reasonable nationalist’, Duk as the rector at the Kuleshov State University in Mogilev. Meanwhile, while choosing the head of the Belarusian State University, the president apparently had in mind the strengthening of the ideological loyalty among the teaching staff and students at the main university in order to keep the youth movement at bay. Previously, Korol was the rector of the Kupala State University in Grodno, where he held purges among the disloyal teaching staff.
The trend for the renewal of mid-ranking executives and their rejuvenation has confirmed. The age of the Culture Minister and three new rectors varies from 39 to 44 years old.