The authorities welcome moderate Slavism
On November 25th, the “Slavic March”, authorized by the city authorities was held in Mogilev.
The authorities encourage political activities of organizations that are not associated with the “conventional” opposition. Simultaneously Minsk attempts to demonstrate to Moscow that Belarus is the bearer of the “true” Slavic values and Russian historical traditions.
The event in Mogilev was of an explicitly “pro-Russian” character: the participants intended to use the black-yellow-white flags of the Russian Empire (all in all, it was not allowed by the local administration), and also claimed to represent the Russian nation and chanted “Glory to Belaya Rus” “Glory to Russia” and “Forward, Russians”. A participant of the 2010 presidential campaign Mr. Ryzhov spoke at the rally.
Most likely, the authorities are interested in holding such events due to their patriotic and pro-Russian character, and especially that they take place near the hometown of President Lukashenko. Mogilev is an informal capital for governmental personnel and the closest to Lukashenko family leaders come from this region.
The “Slavic March” was approved and held for the second time. The first “Slavic March” was approved to be held before the presidential elections in September 2010, but then it did not take place because of the organizer’s desire to use the unauthorized black-yellow-white flags. On November 25th the March was attended by about 40 people - mostly young people, united around an informal leader Mr. Denisenko, who was not a member of any organization.
The authorities’ arbitrary policy towards different political players is confirmed by the Slutsk Executive Committee’s rejection of the request filed by the head of the Belarusian Popular Front local branch Mr. Amelkovich to hold a rally to commemorate the anniversary of the Slutsk uprising on December 1st. The BPF is known for its patriotic, but stridently anti-Russian position, which has probably predetermined the authorities’ decision against the BPF initiative.
It would be a mistake to assume that the government is really interested in the revitalization of political movements in Belarus - any political activity is perceived as a threat to the current regime. Therefore, the authorities were quite comfortable and safe with a small number of the “Slavic March” participants, as well as with the non-existence of ‘Slavism’ organizations in Mogilev.
The rapid increase in wages has led to a decline in the ratio between labour productivity and real wages to one. Previously, the rule was that enterprises, in which the state owned more than 50% of shares in the founding capital, were not allowed increasing salaries if this ratio was equal to or less than one. The authorities are unlikely to be able to meet the wage growth requirement without long-term consequences for the economy. Hence, the government is likely to contain wage growth for the sake of economic growth.
According to Belstat, In January – August 2017, GDP growth was 1.6%. The economic revival has led to an increase in wages. In August, the average monthly wage was BYN 844.4 or USD 435, i.e. grew by 6.6% since early 2017, adjusted for inflation. This has reduced the ratio between labour productivity and real wages from 1.03 in January 2017 to 1 in the first seven months of 2017. This parameter should not be less than 1, otherwise, the economy starts accumulating imbalances.
The need for faster growth in labour productivity over wage growth was stated in Decree No 744 of July 31st, 2014. The decree enabled wages growth at state organizations and organizations with more than 50% of state-owned shares only if the ratio between growth in labour productivity and wages was higher than 1. Taking into account the state's share in the economy, this rule has had impact on most of the country's key enterprises. In 2013 -2014 wages grew rapidly, which resulted in devaluation in 2014-2015.
Faster wage growth as compared with growth in labour productivity carries a number of risks. Enterprises increase cost of wages, which subsequently leads to a decrease in the competitiveness of products on the domestic and foreign markets. In construction, wholesale, retail trade, and some other industries the growth rate of prime cost in 2017 outpaces the dynamics of revenue growth. This is likely to lead to a decrease in profits and a decrease in investments for further development. Amid wage growth, the population is likely to increase import consumption and reduce currency sales, which would reduce the National Bank's ability to repay foreign and domestic liabilities.
The Belarusian government is facing a dilemma – either to comply with the president’s requirement of a BYN 1000 monthly wage, which could lead to new economic imbalances and could further affect the national currency value, or to suspend the wage growth in order to retain the achieved economic results. That said, the first option bears a greater number of negative consequences for the nomenclature.
Overall, the rapid growth in wages no longer corresponds the pace of economic development. The government is likely to retain the economic growth and retrain further growth in wages. Staff reshuffles are unlikely to follow the failure to meet the wage growth requirement.