Aleksandr Lukashenko hears out report of government and National Bank

President of the Republic of Belarus Aleksandr Lukashenko urged to work out the main program documents concerning the social and economic development of the country for 2014 necessary to ensure balanced development and higher living standards of people. The head of state made the statement as he heard out a report from the government and the National Bank on the operation of the Belarus economy in 2013, the draft development forecast, the draft budget, and the draft monetary management guidelines for 2014 on 29 November.

At the beginning of the session Aleksandr Lukashenko said that the Belarusian government must fulfill all the instructions that have been issued earlier.

“Before we start talking about items on the agenda, I would like everyone to calm down because due to various reasons tensions have been running high both in mass media and in our society and therefore some people may have come here today expecting shocks. I have to tell you that no revolution is going to happen. All the matters — organizational and personnel ones — will be dealt with in Q1 2014 in an evolutionary manner,” the President said.

“The instructions I have given acting upon the government’s initiatives must be fulfilled. Everyone understands what will happen to those, who fail to do it,” the head of state warned.

Aleksandr Lukashenko asked the government and the National Bank to present their report about how things will be at the beginning of the next year and how the country will live next year in a simple manner. The President pointed out that the year 2013 is nearly over and the adoption of the documents central to the development of the country cannot be delayed.

“But before outlining future goals we have to thoroughly analyze the real situation regarding the fulfillment of this year’s plans. What we have managed to do and what we haven’t. With what figures are we going to start the new year? It is unlikely the situation will change radically in the last month,” the head of state said.

Aleksandr Lukashenko said that an absolute majority of the social and economic development forecast targets have not been hit in 2013.

“An absolute majority of forecast parameters have been failed. But we should look beyond that. We should uncover reasons behind the failures and the problems that slow down the country’s development,” the President stressed.

“I will tell you straight away. I am particularly concerned over the work style of the government, the National Bank and local authorities, their inability to finish what they start, inaction and hesitation,” the head of state said.

He reminded the attendees that the tasks for this challenging year were discussed at an extended session of the Council of Ministers held at the beginning of the year. “I minced no words when I said that if this year the situation will be the same as last year, this will mean immediate resignation of the government. I asked them to get grounded and get down to real things. I asked them to demand total dedication and devotion from everyone, and to make sure the work would be efficient,” the President said.

“It seemed we sorted everything out. You undertook obligations. Legal acts of the head of state were submitted and approved upon your initiative and in the way you wanted,” Aleksandr Lukashenko said. He reminded that back then he warned the government that GDP is unlikely to expand by 8.5%. However, the government assured that everything was well-planned. “Now we can expect only 1.5% and getting even that may be a problem,” the head of state said.

“You were trying to convince me that volumes were not needed. Instead the government promised high quality and balanced development of the economy. I heard you back then and didn’t pull anyone and didn’t put pressure on anyone regarding the volume parameters during the year. And what do I get in the end? Nothing of the two I am told,” the President remarked.

“You promised to balance the foreign trade in commodities and services. We have achieved a foreign trade deficit instead of a surplus,” the head of state said. “You were eager to keep inflation as low as 12%. In reality people are still tense about rising prices. In January-October 2013 inflation reached the figure we planned to secure at the end of the year,” he added.

The President reminded that a lot had been said about the fulfillment of economy modernization plans. “You set out to raise earnings per worker to at least $48,000 this year and to $60,000 by 2015,” Aleksandr Lukashenko said. “At present according to the most optimistic evaluations earnings per worker in 2013 can be only $43,000. You have definitely failed to achieve your goals”.

“Since a lot is said about modernization, particularly by those frauds, political opponents, I would like to note that we are not going to get $50,000 or even $60,000 per worker without modernization,” stressed Aleksandr Lukashenko. “We cannot achieve sales and revenues using outdated equipment, with mess in production facilities and mess in heads of workers. We need new breakthrough technologies and a modernized economy in order to get a product and sell it on international markets, which are demanding these days”. “We came to the conclusion a long time ago, but back then we were not ready for it. Back then we paid much attention to the agriculture and it was the right thing to do. Those, who don’t care about agriculture in the post-Soviet space and in the so-called socialist camp, lead a life of misery and pick up crumbs from the table of the rich European Union nations,” the President added. Aleksandr Lukashenko stressed that modernization or, simply speaking, better manufacturing is a matter of survival of the state.

The President remarked that forecast parameters in other areas had not been secured either. “Your own promises and direct instructions of the head of state do not get fulfilled. And the trend can be registered during the entire work of the present composition of the government,” the President stressed.

Addressing Prime Minister of Belarus Mikhail Myasnikovich, Aleksandr Lukashenko reminded that a dedicated government session had been held to discuss the reduction of the stock in storage. Back then top officials, members of the government were assigned enterprises with the largest stockpiles of unsold products in order to remove existing hindrances and secure the reduction of the stock in storage and hence earn money for enterprises virtually in a manual mode.

“Certainly, there have been some changes, not on the scale of your promises, including during my visit to OAO Motovelo. Since production volumes were not the goal, one might have expected a larger reduction of the stock in storage,” the President believes.

“However, instead of the real work cheating has started. Merchandise has been shipped from Belarus to warehouses of so-called dealers abroad. It is totally useless,” the head of state stressed.

Aleksandr Lukashenko warned that the State Control Committee and the State Security Committee will verify the progress reports. People will be made answerable for blatant cheating, the President underlined.

Aleksandr Lukashenko noted that the government failed to fulfill his instructions regarding the entire economic sectors.

The President mentioned the linen industry to illustrate his point. In his words, since 2011 the current composition of the government was given 76 instructions. Less than half of them were fulfilled, at a pinch. The basic requirements related to the linen industry efficiency were not met. The industry’s upgrade pace is inadmissibly slow. “It became that bad that I had to call off the planned visit to Orsha Linen Mill. They tried to convince me that new highly efficient technological equipment will be installed there by 31 October. However, they missed the deadline and failed to show what they achieved,” the head of state said addressing Vladimir Semashko and Piotr Prokopovich.

Aleksandr Lukashenko reminded that everyone still remembers the failure to upgrade basic enterprises of the wood processing industry. “Strange enough, until I interfered, neither the government nor the governors paid due attention to these companies. The results of my interference are obvious. This is not the end,” the President said.

The head of state underlined that he is displeased that the government and the Vitebsk Oblast Executive Committee got stuck in a red tape and take their time while addressing the issues in the footwear and leather industry.

“We held a special meeting to discuss this matter in November 2012. The prospects seemed bright. They promised to set up two holding companies in Vitebsk Oblast and increase footwear production up to 12 million pairs. In reality, it took a year to adopt an economically feasible plan that provided for a more modest output growth and returns on sale. If they proceed the same way, I am not sure that even these plans will be materialized,” the President said. Aleksandr Lukashenko added that the same pertains to the government’s plans to upgrade OAO Kamvol.

Aleksandr Lukashenko noted that great hopes are pinned on agriculture that has turned into an important source of foreign currency revenue and helped boost the country’s export capacity. “Export of agricultural products is on the rise. This year overseas sales will amount to $6 billion. In 2015 export revenues are to make up $7 billion. However, I am concerned over the decrease in milk production and sales. Governors will be held accountable for that, because it is their scope of responsibility,” the head of state said.

The President told the governors and the Minsk Mayor that the deficit of dairy products in Belarusian stores is unacceptable. “I hear again and again about the lack of dairy products in Minsk and elsewhere in the evening or at night,” the Belarusian leader said.

The President pointed out to some issues related to the construction of dairy complexes. Oblast executive committees undertook to complete the renovation of 1,208 dairy farms by October 2013. However, even by the yearend the renovation of only 940 farms will be completed. “The situation varies from region to region. Gomel Oblast, Grodno Oblast and Minsk Oblast are working on it; Brest Oblast has almost completed it, while Mogilev Oblast and Vitebsk Oblast will fail to meet the target. Mogilev Oblast will complete only 50% of the renovation projects and Vitebsk Oblast about 20%. I remember ardent promises of the governors of these regions. Mogilev Oblast Governor put forward some novel technology (nobody prevented him from implementing it) which was about some laminated or wooden structures,” Aleksandr Lukashenko said.

“I am sick and tired of your excuses. You say you need more resources. So go ahead and find them, stop this idle talk! This was your responsibility. I told you that this is a litmus test of the performance of the governors,” the head of state underlined.

Addressing Vice Premier Mikhail Rusy and Agriculture and Food Minister Leonid Zayats, the Belarusian President said that there is a lack of cattle at some farms. If not for that, Belarus would considerably increase the production of dairy products that are in great demand abroad. “The demand is huge in Russia, Kazakhstan. The price is very high; all you have to do is to sell. This trend is expected to remain in place in 2015,” the Belarusian leader said.

Aleksandr Lukashenko noted that during his working trips to the regions, he often comes across unfulfilled obligations on the part of central and local authorities. “Bungling, negligence and mismanagement are ubiquitous. They lack basic discipline and businesslike approach,” the President said.

“The main criterion of a businesslike character is as follows: you promise, you fulfill. This principle is of special relevance nowadays when we need to work harder to avoid collapses, secure balanced development and strictly stick to the implementation of the outlined goals, need to learn how to use every opportunity we get both in the domestic and foreign markets,” the President said.

“I advise you to restrain from blaming the economic problems of your traditional customers, Russia for instance. Apart from Russia, there are two hundreds more countries. You better tell me how you have worked in the countries which are demonstrating a solid growth today,” Aleksandr Lukashenko said. The Belarusian leader stressed that despite the crisis in some regions and countries, the overall global GDP has been stably going up, which means there are opportunities for export activities.

According to the President, the year 2013 was a difficult one aggravated by the worsened foreign trade conditions. “Next year the situation is unlikely to change to the better. But we still should work twice as hard,” the Belarusian leader said.

Aleksandr Lukashenko underlined that he would like the government’s report to primarily focus on whether the government can do their job as the country’s economy HQ in its present composition. “If you can, then I’d like to hear what top-priority measures will be taken to secure the necessary dynamics of balanced development and the movement towards the trajectory that will bring us closer to fulfilling goals of the five-year program or that at least will allow us to fulfill the goals set for 2014. I wonder whether the draft social and economic development forecast and the draft budget have been properly calculated taking into account our resources and technology capabilities, the feasibility of reaching the outlined goals. Is the draft forecast tied to the existing manufacturing programs of economy branches, to future development plans of the regions?” the President asked.

The head of state was also interested whether the state budget will stay socially oriented and when it will be possible to secure the increase in the quality and the level of living standards of Belarusians in accordance with resolutions of the 4^th All-Belarusian People’s Congress.

“I must tell you that I am seriously concerned about the definite detachment of the current [social and economic development] forecast from the real life. It seems that only now the oblast governors, ministers, and heads of major contributing enterprises, who are present here, are starting to find out what tasks they are going to have to deal with next year,” the President said.

“I am concerned that nobody is tense, nobody sweats and argues about the forecast parameters. This is something extraordinary. By now I usually would have received an abundance of requests and complaints. And I get nothing but silence! Have you managed to reach an agreement that fast and are now of the same opinion?” the Belarusian leader asked.

Addressing Prime Minister of Belarus Mikhail Myasnikovich, Aleksandr Lukashenko mentioned that the Presidium of the Council of Ministers had been trying to decide on the targeted growth of the gross domestic product — 3.3% or 5.7% — for three sessions. The President said: “It seems that the government are trying to guess future by reading tea leaves. Has anyone looked at what will drive the gross domestic product? At the contribution of economy branches, regions, and enterprises? We have slightly more than 100 major contributing enterprises in the production sector. Does the government know how each one of them will develop next year? Do the oblast governors have verified development plans for these enterprises?”

Aleksandr Lukashenko was also interested in how the agriculture will develop and when the relevant gains from the investments it has consumed will be secured.

The head of state also drew attention to government plans to raise export, which is central to the economy development. The export growth rate is expected to exceed 111%. Meanwhile, the production sector growth is expected at 103.8%. “The question is whether we will objectively have enough Belarus-made products to simultaneously hit the export target and keep the domestic market satisfied? Or do we have that much stock in storage that we will be able to pull it off?” the head of state wondered.

“We need to understand in what way the monetary instruments will be used to address the issues facing the real production sector,” the Belarusian leader said.

Aleksandr Lukashenko emphasized the need to maintain stability on the foreign exchange market. “I will tell you honestly what I said to the Chairperson of the National Bank and the Premier. They and the bankers they chose (there is about a dozen of them) will be responsible for the stability of the currency market. Banks seek to be independent from the state and people. They say they live in the market economy forgetting that they make money on the Belarusian economy,” the President said.

“I warn you once again: each of you has a certain responsibility zone, openly or not. I think the bankers have heard me. I do not care what kind of banks they run and where their capital comes from, be it the West, Russia or Belarus. You came here to work, you promised stability, so work hand in hand with the government,” the President said.