Law Enforcement Officers Continue to Extend their Influence on Belarus’ Political Scene

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April 22, 2016 18:13

Belarusian law enforcement bodies continue to strengthen their position in the system of governing as well as within the Belarusian elite. Several factors, both direct and direct, indicate the growing influence of law enforcement and intelligence officers. They are officially granted authority and social benefits. Belarusian society feels a rise in the formal and informal influence of the Belarusian law enforcement bodies and responds by a passive refusal to trust the authorities. However, there are still no grounds for active political protests in Belarus.

During the first year and a half of President Lukashenko’s fourth term, Belarus’ law enforcement agencies consistently increase their influence in the system of governance and society, as well as actively create security guarantees for themselves. The reform on the preliminary investigation, carried out in 2011, confirms this statement. Under the reform, two agencies: the Investigation Committee and the KGB now have the monopoly to conduct investigations into corruption cases and economic crimes. In addition, in late June 2012 the KGB managed to make amendments to the Law, greatly expanding its authority to carry out investigations. On 4 July, President Lukashenko issued a special decree which grants the KGB authority to put citizens on a preventive list and ban them from foreign travel (previously, this was the right of the Ministry of Internal Affairs, Defense Ministry and the Ministry of Justice).

As previously noted in our overview, Belarusian law enforcers have not stopped at expanding their professional authority and continue to strengthen their status as top elite. In particular, they are lobbying for changes in the education and training system for prosecutors and investigators (under the reform, investigators will be trained by the Management Academy under the auspices of the President) and for the judiciary reform (a proposal to transfer cases against security forces staff under the military courts’ jurisdiction). Earlier, in the course of the housing loans reform, the law enforcement agencies staff were the only bureaucratic group which retained the right to build houses with the help of loans at a reduced interest rate of 5% (for all other categories of population the loan interest is significantly higher; loans with 1% interest rate can only be allocated to families with several children).

Indirect indicators of the increased influence of the law enforcement elites are none the less interesting. One of them is Lukashenko’s lack of response to the violation of Belarus’ airspace by a small single-engine Swedish airplane which took place on July 4, a day after the military parade on Independence Day in Minsk. Although the incident seriously damages the reputation of the Belarusian Defense Ministry and State Border Committee, the lack of official response has another meaning. It seems that Belarus’ border guard service and military officers have enough influence and power to deny an obvious fact without fearing grave consequences.

The trend of strengthening the positions of law enforcement officers did not go unnoticed by the Belarusian population.

According to a survey carried out in June, 56.5% of respondents believe that President Lukashenko’s power is supported by the forces of the Interior Ministry, Defense Ministry and the KGB (as compared to 48.6% in 2006). At the same time, the number of Belarusians who believe that the President’s power is rooted among common people declined from 34.2% to 18.1% in the period from 2006 until present. Such attitudes in society lead to the domination of an escapist mood: 63.3% of the interviewees say that they are living, relying only on themselves, and avoid any contact with authorities. At the same time, there is no growth in a protest mood among the population.

If these trends continue, they will lead to a further split within Belarusian society. There will be elites close to the management of the country and the rest of the population who are deprived access to substantial benefits and do not have impact on the governmental decision-making process.

Since a specific feature of power elites is their lack of responsibility towards society (they are not elected and traditionally avoid public appearances), the strengthening of the security forces in the system of governance can be accompanied by an increase in social, economic and political risks.

Belarusian law enforcement bodies are interested in escalating such broadly interpreted risks, since the elimination of threats increases their own importance. As previously mentioned, we can observe a growth of various risks since 2012, starting from financial risks, to people’s household deposits, to the questionable cases of Islamic terrorist attacks prevented by the KGB in the Gomel and Brest regions.

President Lukashenko is still a deterrent in strengthening the positions of the security forces as new elite. He is traditionally very suspicious of rivals, especially if they are a group. At present, there are no signs of response from the president. However, the next steps to create counter-elites are likely to be taken in autumn after the parliamentary elections. Earlier President Lukashenko talked about the possibility of political reform in Belarus, but its character is still unclear.

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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.