Belarusian authorities propose to discuss a moratorium on the death penalty
On March 20, after the Summit of the EurAsEC, Pesident Lukashenko was interviewed by a Russian English-speaking TV channel Russia Today, network broadcasting outside Russia.
The cornerstone of the interview was the issue of execution of two defendants in the case of the terrorist attack in the Minsk metro on April 11, 2011. Lukashenko rigidly insisted on him being right, which was not surprising, bearing in mind that both convicts were executed virtually the day before. The President reasoned, that “this was exceptionally a criminal case, which should not be politicized”.
Also Lukashenko reiterated twice that the EU had not addressed him with a request to postpone the executions. Thereby the President emphasized he did not violate any commitments and also made it clear he was ready to discuss the death penalty with the EU.
So, paradoxically, Lukashenko has opened the prospects for negotiations on the introduction of a moratorium on executions in Belarus. On the following day, Chairman of the Constitutional Court Petr Miklashevich explained the procedures for imposing of a moratorium or abolition of the death penalty.
We have previously pointed to the paradoxical behaviour of the authorities in the international relations, i.e. that they intersperse tough measures with promises of liberalization. Introduction of a moratorium on the death penalty is a lengthy procedure, requiring parliamentary vote, which could prolong the process of normalization of the relations between Belarus and the EU and made to look not as a concession and a sign of weakness, but as a “constructive dialogue”.
At the same time, such shift of accents would help the authorities to distract the public attention from other requirements of the EU and the U.S., namely, the release and rehabilitation of political prisoners and democratization of the electoral system.
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.