The opposition is more active in the regions on the eve of local elections

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April 22, 2016 18:35

Belarusian opposition forces have continued their campaign in the regions this week.

Despite the ‘dead’ holiday season, the approaching elections to the local councils activate the opposition and increase competition in the political arena of the country. The most visible effect of these actions of the opposition is growing recognition and strengthening of regional opposition structures. Success of the opposition is still defined by the feedback or nonfeasance of the authorities. 

Representatives of the civic campaign ‘Tell the Truth’, movement ‘For Freedom’ and the Belarusian Popular Front continued canvassing in the regions as a part of the campaign ‘National Referendum’. In particular, two groups visited a number of cities in the Brest region and met with local market traders and democratic activists. The initiators of the ‘National Referendum’ campaign ask citizens to establish a register of problematic socio-economic and political issues that need to be solved at the national level: tax rates, wages, the quality of public services, the reform of the electoral system etc. 

The organisational committee of the ‘Belarusian Christian Democracy’ party has commenced two initiatives: the establishment of the community headquarters against African swine fever and campaign to protect the rights of taxi drivers. The foundation of the community headquarters against ASF coincided with the time when residents of so-called buffer sanitary zones had to liquidate the pigstock as ordained by the government. Because of this, for example, a spontaneous unrest of local residents took place in the Berezovsk rayon (province) of the Brest region. The second initiative of the BCD is related to the probable drafting of the government bill on new rules of organisation of taxi services that could affect the requirements as regards technical parameters of motor vehicles.

The positive impact of these initiatives can be seen at least in the geographical expansion of the activities of the opposition and creation of competing political projects (the project ‘National Referendum’ by ‘the triad’ and the ‘National Deputy’ project of the BCD). This intensification of activity is related to upcoming elections to local councils, as this election campaign is the most local in nature, which forces activists to act away from the capital and regional centers - the main areas of activity of the opposition during parliamentary and presidential campaigns. 

The future of the above projects will become clearer when they move from the planning to the implementation stage. Namely, when and whether the initiators of the ‘National Referendum’ campaign will form a list of issues and start gathering signatures, and the initiators of the ‘National Deputy’ programme will actively represent the interests of the pigs’ owners and taxi drivers. The future of these initiatives will be determined by the feedback of the citizens.

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Growth in real wages may disrupt macroeconomic balance in Belarus
October 02, 2017 12:12
Фото: Дмитрий Брушко, TUT.BY

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.