The Belarus dictator is now investigating companies that raise prices.
(Photo: IMAGO/ITAR-TASS)
Berlin Belarusian dictator Alexander Lukashenko takes it easy when it comes to fighting inflation: he simply forbids raising prices.
More than 20 people have now been arrested for raising prices contrary to the President’s orders. The Prosecutor General’s Office has now opened 34 such criminal cases, the state broadcaster “Belarus1” reported.
A moratorium on price increases has been in effect in Belarus since October 6. “Any price increase is prohibited from October 6th. Forbidden! From today. Not tomorrow, but today. So that you don’t inflate the prices within 24 hours. For this reason, price increases are prohibited from today,” Lukashenko said on TV after a government meeting.
All manufacturers, importers, dealers and service providers are prohibited from raising prices. This applies to both food and non-food products. It is also forbidden to increase prices by eliminating special offers, discounts and sales.
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Lukashenko justified his decision by saying that prices on the domestic market had become “unaffordable” and had “reached the ceiling”. He did not give details.
If you want to raise the prices, you have to ask the administration
Since then, the prices for new goods and services have had to be agreed with the authorities. Lukashenko’s decision was preceded by a sharp rise in inflation in the country.
According to the National Bank of Belarus, inflation rose from 9 percent in December last year to over 17 percent in July this year. At the same time, Belarusian GDP fell by 5.2 percent in the period from January to July, according to the state statistics office Belstat. The government had previously forecast economic growth of 2.9 percent for this year.
Lukashenko’s inflation brake is a veritable bureaucracy monster. Only agencies or organizations under the government such as the “State Control Committee” and local governments are allowed to approve price increases.
Before doing so, they have to find out whether a price increase is economically justifiable. If a particular product has never been manufactured in the country or a service has never been provided, the costs must be agreed with the same bodies.
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According to the Lukashenko decree, prices must be formed on the basis of two factors: economically justified costs and a marginal profit margin, but no more than ten percent.
Particular attention is also paid to local products. Price increase bans are expressly imposed on musical instruments such as balalaikas, accordions and cymbals.
EU sanctions make Belarus‘ create economy
While high inflation in Western countries is mainly due to rising energy prices, in Belarus it is mainly due to the disruption of supply chains as a result of EU sanctions. The EU began imposing restrictions on Minsk after the 2020 presidential elections in Belarus, which Lukashenko had massively rigged.
Sanctions pressure intensified after the Lukashenko-backed Russian invasion of Ukraine on February 24.
Parallel to the Lukashenko price decree, the Russian government gave its ally a 1.5 billion euro loan so that it could replace imported products with domestic production. Belarus also gets cheap oil and gas from Russia.
Products refined from Russian crude oil, such as diesel and petrol, are the country’s main export products – along with potash, which is important for fertilizer production but is now on the EU sanctions list.
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