Economic recession in Belarus will be treated with changes in statistical methodology

April 22, 2016 19:15

The National Statistical Committee has adopted a new methodology to measure non-observed economy. These changes were prompted by the need to have better understanding how non-observed economy affected the overall economic performance in Belarus. As a result, GDP is unlikely to start growing, however some statistical indices may improve. 

The new regulation regarding non-observed economy measurements will take effect in late June 2015. The core changes in the methodology imply inclusion of a greater number of activities when calculating GDP. In particular, the volume of housing services for personal consumption has been increased. If a company does not provide statistical reports, then it will be assumed that its workers produce equal volume of products with those companies, which engage in similar activity and report to the Statistics Committee. Private entrepreneurs will report like small enterprises with up to five people. Tutoring services will be measured based on number of those admitted to full-time studies at universities. 

Such changes have been introduced in order to have better understanding how non-observed economy affects the overall economic performance in the country. Errors and omissions in the Belarusian balance of payments previously often were explained by the exclusion of non-observed economy from statistical measurements. Several state agencies will be in charge of implementing the new regulation. 

In Q1 2015, the Belarusian economy fell by 2.6% without any prospects for improvement. Industry was the main culprit of falling GDP. Meanwhile, amid crisis and mass layoffs, non-observed economy has grown. Non-observed economy’s production output would be difficult to compare with the production output at larger enterprises and in most cases would be significantly lower. Expert evaluation, which will be used in the updated methodology would be difficult to verify, which might lead to overreporting. Some entrepreneurs will cease operations, but will be included in GDP measurements. 

Overall, the Belarusian Statistical Committee has acknowledged problems with traditional economy reporting. It seeks to improve reporting by including non-observed economy indicators. Eventually, these new adjustments in the methodology are unlikely to show significant impact of non-observed economy on the economy in general, however, they might demonstrate economic growth by about 1% before the presidential elections in October 2015.

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The Belarusian authorities have launched a discussion on the moratorium or abolition of the death penalty under the pressure of Belarusian human rights activists and international community. Apparently, the authorities are interested in monitoring public sentiments and response to the possible abolition of the capital punishment. The introduction of a moratorium on the death penalty would depend on the dynamics in Belarusian-European relations, efforts of the civil society organisations and Western capitals.

In Grodno last week, the possibility of abolishing the death penalty in Belarus or introducing a moratorium was discussed.

The Belarusian authorities are likely to continue to support the death penalty in Belarus. During his rule, President Lukashenka pardoned only one person, and courts sentenced to death more than 400 people since the early 1990s. Over the past year, Belarusian courts sentenced to death several persons and one person was executed.

There are no recent independent polls about people’s attitude about the death penalty in Belarus. Apparently, this issue is not a priority for the population. In many ways, public opinion about the abolition of the death penalty would depend on the tone of the state-owned media reports.

That said, the Belarusian Orthodox Church and the Roman-Catholic Church stand for the abolition of the capital punishment, however their efforts in this regard only limit to public statements about their stance. Simultaneously, the authorities could have influenced public opinion about the death penalty through a focused media campaign in the state media. As they did, for example, with the nuclear power plant construction in Astravets. Initially unpopular project of the NPP construction was broadly promoted in the state media, and eventually, according to independent pollsters, was accepted by most population.