International goods trade: no chance for positive trend

April 22, 2016 18:33

On July 1st, Belstat released data on foreign trade in January-May 2013. Exports amounted to USD 16 billion (decreased by 15.6% compared with January-May 2012), imports - USD 17.42 billion (down 10.9%), foreign trade deficit - minus USD 1.4 billion.

In May, Belarus has lost one of the main exports – potash sales. Concerns about the growth in investment goods imports have been fully justified. Merchandise trade will not only be unable to shift to an upward trend by the year-end, but the situation might deteriorate even further and one of the main reasons would be African swine fever (ASF).

According to the National Statistics Committee in May foreign trade balance was negative USD 372.9 million. The negative export trend in May also showed two major exports - oil and potash fertilizers. If in Q1 2013 fertilizers were one of the two positions which showed exports growth by at least USD 100 million compared with Q1 2012, in January – May potash exports dropped compared with 2012. On June 30th, contract for potash supply to China expired. There are no chances to conclude a new one by the year-end. Brazilian market remains the only chance for Belaruskaliy to maintain foreign exchange proceeds not lower than in 2012.

Industrial modernization has resulted in a sharp increase in investment imports. Imports reduction to that of last year should not mislead. In fact, only one import position has dropped significantly - oil, which was used to produce solvents, lubricants and biodiesel in large volumes. Trucks, electrical machinery and equipment imports increased by more than USD 1 billion in January-May 2013 compared with 2012.

The foreign trade situation is deteriorating in several dimensions. One of the main potential threats is the loss of the Ukrainian market of petroleum products. Rosneft and Vetek plan to start oil supplies to Ukrainian refineries, which can result in decreased demand for Belarusian oil products. ASF virus can have serious economic consequences not only for agriculture but also for the economy as a whole. On average, pork production exports’ proceeds were USD 40 million per month. Deliveries from two regions have already stopped. If the virus spreads across the country, Belarus will have difficulties not only with meat exports and supplies, but also with implementation of quarantine measures, which will reduce the traffic intensity through Belarus.

Thus, even theoretically, it would be impossible for Belarus to achieve foreign trade in goods surplus. Given open borders with Russia, Belarus is unable to discourage consumer imports, and investment equipment import for the modernization purposes is declared a priority. Simultaneously, Belarus’ export potential is not great and is subject to risks – both due to domestic causes and due to the world economy slowdown. 

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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.