Opposition in between elections

Category status:
April 22, 2016 18:21

Opposition starts preparing for the 2015 Presidential elections. At the same time, it remains internally divided: one part remains active within the electoral cycle, and the other is trying to act beyond its scope and to expand its activities on social and civic spheres.

After the September Parliamentary elections, the Belarusian opposition parties and movements made a number of statements about their future activities.

In October the following opposition forces expressed their willingness to participate in the Presidential campaign: Belarusian Popular Front (likely candidates are Mr. Yanukevich and Mr. Kostusev), “For Freedom” movement (Mr. Milinkevich), “Tell the Truth!” civil campaign (Mr. Nyaklyaeu), the Belarusian Social Democratic Party (Hramada) (potential candidate has not been named yet). The United Civil Party also expressed willingness to participate in the Presidential election.

Potentially, the EU has pushed the oppositional forces towards making these statements: in October a series of events took place with the participation of Belarusian opposition and European politicians (in Brussels, Prague, Berlin and Warsaw). It implies that the EU can successfully stimulate the Belarusian opposition, at least, to making policy statements. In turn, the opposition regards such EU’s interest as an “auction offer”.

The most controversial issue, about which there is no consensus among the opposition, is the participation format in the next presidential elections, namely, the ‘single candidate’s’ fate. In particular, different political forces have already offered several options concerning the nomination procedure for a single candidate: “primaries” (by the UCP), All-Belarusian Congress or Democratic Forces Congress (by “Tell the Truth!” movement).

However, after the Parliamentary elections, the existing situation inside the opposition reduces the likelihood of success of the “single candidate” scenario. The recent election campaign has divided the opposition into so-called ‘radical’ and ‘constructive’ opposition (depending on adherence to ‘boycott’ or participation tactics). And such split continues increasing mutual suspicions and accusations of “collaboration with the secret services” of different states.

In addition, it is worth mentioning that all mentioned above statements regarding opposition’s participation in the 2015 Presidential elections were made separately by each opposition movement, and not as by potential ‘coalitions’. Moreover, one of the proposed procedures for a single candidate – ‘primaries’ – had already been discussed before the 2010 elections by thirteen political and civil actors and they were not able to come to a final decision. Finally, the UCP party had actually accused the “For Freedom” movement of disrupting this process.

As for the most radical opposition wing ‘in exile’, it still has no political perspectives. There was the possibility that leadership in this group would be assumed by ex-presidential candidate A. Sannikov. However in his recent statement Mr. Sannikov did not indicate any political ambitions and linked his exile with the desire to save the remaining political prisoners.

Thus, we would anticipate that the following trends in the Belarusian opposition will remain up until the 2015 election campaign:

1. Party opposition will continue acting within the electoral cycle, and will focus on developing strategies and tactics to participate in the presidential campaign, as well as on discussing the single candidate nomination procedures.

2. Non-party opposition, “For Freedom” and “Tell the Truth!” movements in particular, will focus on the implementation of social, civic, cultural and educational projects, simultaneously participating in the party opposition activities.

3. The conditional split on the “radical” and “constructive” opposition will remain as the aftermath of the parliamentary elections tactics (boycott vs participation).

4. It is likely that the “radical” opposition will reduce its political activity, primarily because of the natural pause between elections, when there are fewer reasons for organizing political events. The experience of the 2011 financial crisis showed, that the opposition was not willing to become involved in social protests at workplaces.

5. ‘Non-conventional’ opposition, i.e. the Liberal Democratic Party, should also be mentioned, since it actively and practically alone tries to strengthen its party ties in the Russian State Duma, that is, in the Belarusian foreign policy’s key area. The party also expressed its willingness to participate in the 2015 election.

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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.