OREANDA-NEWS. February 17, 2009.  The necessary measures are being taken in Belarus to control inflation, the presidential press service quoted Prime Minister Sergei Sidorsky in his report to President of Belarus Alexander Lukashenko on February 16.

In 2008 the consumer price index totalled 113.3% while the target was set at 108%. January 2009 saw inflation as high as 4.1%, which is attributed to the Belarusian ruble devaluation. Meanwhile, the necessary measures are in place in Belarus to tame inflation. Auditing efforts of the Economy Ministry with assistance of the State Control Committee and other measures have managed to stop unreasonable growth of prices and prevent multiple cases of price mayhem.

The meeting tabled the performance of the national economy in 2008 and in January 2009. In 2008 17 out of 19 major targets of the President-approved social and economic development forecast were hit. In this situation it was not possible to secure the assigned foreign trade goals.

The economic situation on foreign markets has not reached the equilibrium point and this is why it has affected performance indicators in January 2009.

Mechanical engineering enterprises were affected most. This industry is most susceptible to recession in economies of the neighbouring countries. As far as Belarusian enterprises are concerned, over the last 4-5 months their sales volume shrank by 30% on the home and foreign markets. Domestic demand incentives and measures meant to preserve foreign sales outlets should play the key role in this situation.

In Belarus all the necessary measures are being taken to minimise consequences of the global crisis for these enterprises. The situation is most complicated at light industry enterprises and enterprises accountable to the Architecture and Construction Ministry, as their operation is tied to the seasonal demand for their products and the lack of sufficient earnings from exported products.

Addressing the problem of payment arrearages in the trade with Belarus’ key trade partner, the Russian Federation, is the most important task at hand. The reduction of the volume of mutual payments decreases the commodity flow as well as turnover assets, simultaneously increasing the finished goods inventory. After the latest meeting of the presidents of Belarus, Russia, and Ukraine the governments of the countries were instructed to deal with these “financial clots”. With this goal in mind banks are supposed to provide maximum lending support for the real economy sector.

Sergei Sidorsky also reminded, efforts had been launched to implement the Belarusian-Russian plan of actions aimed at minimising consequences of the financial crisis, improving the balance of payments, perfecting conditions of business and the mutual trade. The plan provides for working out proposals for giving companies an equal access to state support, including access to government purchases and preferential loans.

Belarus and Ukraine are supposed to sign a similar document after a meeting of the prime ministers in late February. The document will also contribute to increasing the bilateral trade. In 2008 Belarus-Russia trade exceeded \\$34 billion while Belarus-Ukraine trade went beyond \\$5 billion.

Measures are in place in Belarus to develop the domestic market. A system of measures has been approved to ensure Belarus’ economic security during the global financial crisis. Ad hoc groups have been set up in the government, ministries, at enterprises, relevant industry-wide and regional measures have been worked out, the situation on the home and foreign markets is monitored. Top-priority measures have been taken in the banking industry, public service, and real sector of the economy.

Measures have been taken to ensure the stable operation of flagship companies and other organisations of the real sector of the Belarusian economy. The best anticrisis practices used by the Russian Federation, Kazakhstan, and other CIS states were taken into account as these measures were developed. The implementation of the measures is meant to bring about more specific, flexible decisions meant to ensure stable operation of Belarus’ largest enterprises.

The implementation of the plan of top-priority actions adopted by the Belarus President Administration and the government for the sake of liberalising business activity in 2009 is one of the most important elements in overcoming the crisis phenomena.

Several important decisions were made by sessions of the boards of ministries and state agencies. The President gave an instruction to work tightly with subindustries and examine the status of every enterprise in detail. The government and local authorities should deal with it without delay.

All in all, in January 2009 the industrial output in Belarus went up by 1.2%. This January the GDP growth reached 4.2% thanks to positive performance of the agribusiness, the civil engineering industry, the consumer market and the service sector. According to the Prime Minister, the economic growth slowdown is not that considerable in comparison with neighbouring states.

The President was also informed about the progress in preparations for the spring field work. Sergei Sidorsky assured the head of state that the readiness of the Belarusian agribusiness for the spring field work is high. Schedules for the delivery of mineral fertilisers, fuel and lubrication materials, repair of agricultural machines, a complex plan for preparing and carrying out the spring field work have been approved and are being followed.

As of February 1, 2009 the readiness of the tractor fleet for the spring field work stood at 85%, higher than the figure registered on the same date of 2008. Around 80% of the available soil-cultivating and sowing machines as well as loaders have been prepared for work.

The President gave an instruction to once again revise the financing of the sowing campaign. According to the Belarusian head of government, the financing will be done using three sources, namely proprietary money of agricultural companies, credit resources of banks and the money saved by regional and oblast budgets in 2008.

Alexander Lukashenko demanded that this year’s yield should not be lower than last year’s.