The Belarusian authorities reiterate the referendum issue; the state aims to task private banks with aiding the public sector

By Zmicier Kuchlej

The president has reiterated a constitutional referendum issue. Authorities aim to task commercial banks with aiding the public sector and have abandoned plans to adjust incomes for inflation in 2020.

The incumbent president is attempting to lower protest moods with promises of constitutional reform. However, the humiliating manner, in which he spoke about possible amendments, has blurred major messages and prompted criticism even among the part of the establishment.

The Brest authorities have focused on the preparations for a local referendum on the battery plant, which should be held after the presidential campaign. That said, analysis of their key messages indicates that they promote further operations of the plant. This local referendum would be the first-ever held in Belarus and would enable to test the electoral mechanics in the context of low popular support for state institutions and unpopular state policies, should authorities decide to hold a constitutional referendum.

Siloviki continued to pursue senior managers in the so-called ‘sugar case’. Last week, they interrogated the Deputy General Director of the Skidzel Sugar Refinery, Siarhei Kulikouski.

Authorities have focused on pumping money out of commercial banks. The government and the National Bank have appointed state representatives in all commercial banks with state shares. The National Bank has issued a ‘recommendation’ for commercial banks to reduce unreasonably high-interest rates on loans. Simultaneously, the share of indebted organizations has grown by more than 12% since early 2020.

The state has no funds for pumping people’s incomes before the elections. Cash incomes relying on the base value and the base rate as of June 2020 will not be indexed for inflation.

Despite serious reputational losses in the wake of the coronavirus outbreak and a high number of daily reported cases, authorities continue to hold mass public events. In H1 2020, Belarus’ GDP decreased by 1.7% although restrictive or quarantine measures to address the coronavirus outbreak were not introduced.

Overall, authorities’ major fund-raising strategy for the economy appears to be pumping out additional funds from commercial banks, the private sector, and persecution for corruption.