The experts of international rating agency Standard & Poor's believes that the economic model, built in Belarus, could threaten the current political regime of the country. Experts note in their latest report that Belarus will face stagnation and crisis of the political system without structural reforms.
According to the report of the rating agency, there currently remains high popularity of acting president Alexander Lukashenko in Belarus. According to experts, this is associated with low unemployment and «high levels of redistribution.» Nevertheless, analysts have concluded that the popularity of the Head of State have adversely been affected by the consequences of the global financial crisis, BelaPAN.
According to Standard & Poor’s report, the global economic crisis has highlighted the structural weaknesses of the Belarusian economic model and the country’s worsen external liquidity. Experts assert shortcomings of the Belarusian economic system: the low share of private sector in the economy, the orientation of the Belarusian commodity to the Russian market, nonmarket system of government lending programs, as well as the unpredictability of the political system.
Standard & Poor’s encourages Belarus to make a number of structural reforms, in particular to diversify export markets, to introduce market-based lending to the real sector, to enhance the role of the private sector, to reduce the costs of the state budget, to ensure the protection of property rights.
International experts say that relatively rapid economic growth are provided by the Belarusian authorities due to the banks, financing the real economy on favorable terms under the State program. This situation, according to experts, can lead to stagnation in Belarus, but not to economic growth.
In addition, the unwillingness of the Belarusian authorities to carry out structural reforms, experts say, affects the external financing of the Belarusian economy. Thus, the rating agency retains «negative» outlook in the sovereign credit rating of Belarus as it states difficulties in attracting the necessary volume of foreign loans, including those associated with the political situation in the country.
In particular, according to Standard & Poor’s, «suppression of the opposition after the election complicates prospects for Belarus’s obtaining new credit from the International Monetary Fund.» Because of this, analysts say, Belarus may lose the attractiveness for investors. «We do not exclude the probability of Western investors’ leaving the country in connection with the actions of the judicial system in Belarus after the presidential election,» the rating agency said in a statement.
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