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Next year’s Belarus social, economic development forecast wanted by September
MINSK, 12 June (BelTA) – The next year’s social and economic development forecast has to be ready by September. Prime Minister of Belarus Andrei Kobyakov gave the relevant instructions during the session of the Council of Ministers’ Presidium held on 12 June to discuss conceptual provisions of the document designed to guide Belarus’ social and economic development in 2019 and till 2021, BelTA has learned. Participants of the meeting also discussed guidelines on Belarus’ budget, finance, and tax policy for 2019 and the medium-term financial program for 2019-2021.
The head of government said: “We now have to decide on conceptual approaches, which will be used to work out the draft social and economic development forecast, the budget, and the major monetary management guidelines for the next year. We don’t have much time. We need the head of state’s approval of the entire package of documents in September.”
Andrei Kobyakov also remarked that it was the first review of the matter but the central government had started working on it a long time before. “Work has been organized to prepare forecasts on the development of the regions and individual branches of the economy. The Economy Ministry has sent the relevant recommendations to all the interested parties,” he said.
The prime minister explained that just like in previous years the Economy Ministry suggests using scenarios to prepare the forecast documents. A basic scenario and a target scenario have been developed to describe the development of the national economy in 2019. The scenarios take into account different external conditions. “The basic scenario is suggested for preparing the state budget. The approach proved its worth in the last two years. The economy growth rate is estimated at 102.8% in line with the basic scenario. The target scenario expects the economy growth rate to reach 104.1%. According to Economy Ministry calculations, the figures will secure the parameters specified by the five-year program,” stated Andrei Kobyakov.
Andrei Kobyakov reminded that it is necessary to raise the GDP up to $100 billion by 2025. “I want reports on how the suggested concept will work towards reaching that goal. Judging from the presented materials, the goal will have to be reached with no changes of the real effective exchange rate of the Belarusian ruble, a high level of state commitments in foreign currency, and a foreign trade deficit. With these approaches we would have to tap into the country’s gold and currency reserves in order to maintain the necessary economic growth trajectory. It is unacceptable. We’ve decided that the gold and foreign exchange reserves need to equal at least two months of import or roughly $7 billion. The decision should be at the heart of the entire package of the forecast documents,” stated the prime minister.
The head of government also mentioned key requirements for the next year’s state budget. The state budget will have to be balanced. It should be able to honor state debt commitments and all the social expenses. “Meanwhile, we must not increase the tax burden on the real sector. The government has to thoroughly rework the tax legislation. Let me remind you that the head of state will need the bill on adjusting the Tax Code simultaneously with the package of forecast documents,” said Andrei Kobyakov.
The Finance Ministry suggested forming the next year’s state budget with a surplus using the current procedures. “It may seem that the country has resources to spare every year. In essence we experience a shortage of resources. I’ve instructed the Finance Ministry to calculate the real size of the surplus just the way it is done in international practice. Judging from the submitted documents, I see that the matter has not been settled yet. I also want reports on how the state budget can be formed from scratch instead of using the achieved figures. I want to know how this work will proceed when municipal budgets need to be put together,” noted Andrei Kobyakov.
The prime minister pointed out that all the conceptual approaches under consideration need to be balanced and mutually compatible.
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