Warehouse stocks still high, government orders are unrealistic

Persistent demands by the president and government to unload warehouses lead to statistics being manipulated and reductions in stock being reported on paper only by enterprises. Warehouses cannot be unloaded because the president and government are demanding for production volumes to increase while demand for Belarusian products is falling.

In October 2013, stocks increased by BYR 1031.5 billion. As of November 1^st stocks were worth BYR 29.11 trillion or USD 3.16 billion. Since January 2013 stocks increase was worth USD 570 million. It was anticipated that on January 1^st, 2014 the stocks’ worth would be no more than on January 1^st, 2013.

Moreover, the real situation with stocks is worse than official statistics suggests. Enterprises use various ways to demonstrate that their stocks have reduced. Stocks are distributed among retailers. Stocks are sent off for secure storage to other regions or to dealer’s warehouses in Russia. Another way is to use the term ‘incomplete production’ in the reports, when an almost-finished product is not in working condition and so is not reported as stock (popular in mechanical engineering).

Stocks built up due to economic miscalculations by the authorities both, for domestic and foreign markets. The situation is aggravated by the existence of quantitative production plans adopted by the central government. The government holds enterprises responsible for not fulfilling these plans, while it is the government which drafts these unrealistic economic plans. As a result, enterprises start cooking the books, because the government is not ready to adjust its plans.

Thus, the government refuses to accept the current market changes and shifts the responsibility for the failure to meet the projected indicators to enterprises. The government should reconsider its policy and pay more attention to quantitative indicators, not qualitative.