{"id":125151,"date":"2025-02-06T12:14:41","date_gmt":"2025-02-06T09:14:41","guid":{"rendered":"https:\/\/pozirk.online\/en\/longreads\/125151\/"},"modified":"2025-02-06T12:15:34","modified_gmt":"2025-02-06T09:15:34","slug":"belarus-pay-rise-seen-as-unsustainable-trend","status":"publish","type":"longreads","link":"https:\/\/pozirk.online\/en\/longreads\/125151\/","title":{"rendered":"Belarus&#8217; pay rise seen as unsustainable trend"},"content":{"rendered":"\n<p><strong>The average salary in Belarus reached a record high in 2024. The government highlighted this achievement in the run-up to January\u2019s presidential election. However, economists caution that salaries may decrease due to inflation, as the government plans to expand state-led investments.<\/strong><\/p>\n\n\n\n<figure class=\"block-image block-image-normal\">\n\n    <img decoding=\"async\" width=\"1440\" height=\"961\" src=\"https:\/\/pozirk.online\/wp-content\/uploads\/2024\/01\/Many_Bel_POZ_Archive_1440-0814.jpg\" class=\"attachment-full size-full\" alt=\"\" srcset=\"https:\/\/pozirk.online\/wp-content\/uploads\/2024\/01\/Many_Bel_POZ_Archive_1440-0814.jpg 1440w, https:\/\/pozirk.online\/wp-content\/uploads\/2024\/01\/Many_Bel_POZ_Archive_1440-0814-354x236.jpg 354w, https:\/\/pozirk.online\/wp-content\/uploads\/2024\/01\/Many_Bel_POZ_Archive_1440-0814-734x490.jpg 734w, https:\/\/pozirk.online\/wp-content\/uploads\/2024\/01\/Many_Bel_POZ_Archive_1440-0814-178x118.jpg 178w, https:\/\/pozirk.online\/wp-content\/uploads\/2024\/01\/Many_Bel_POZ_Archive_1440-0814-768x513.jpg 768w\" sizes=\"(max-width: 1440px) 100vw, 1440px\" \/>\n    <figcaption>\n        \n                    <div class=\"block-image__author\">\n                                <span>(Pozirk)<\/span>\n            <\/div>\n            <\/figcaption>\n<\/figure>\n\n\n\n<p><strong>Bumpy ride<\/strong><\/p>\n\n\n\n<p>State media herald higher salaries as a sign of prosperity and a personal accomplishment of the Belarusian leader, while economists warn that the economy could falter.<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-wp-embed is-provider-flourish wp-block-embed-flourish\"><div class=\"wp-block-embed__wrapper\">\n<iframe class=\"wp-embedded-content\" sandbox=\"allow-scripts\" security=\"restricted\" title=\"Interactive or visual content\" src=\"https:\/\/flo.uri.sh\/visualisation\/21429791\/embed#?secret=glmYiit3To\" data-secret=\"glmYiit3To\" frameborder=\"0\" scrolling=\"no\" height=\"575\" width=\"500\"><\/iframe>\n<\/div><\/figure>\n\n\n\n<p>Rebuilt in the 1990s from the remnants of the Soviet Union, the Belarusian economy flourished in the 2000s, bolstered by high global oil prices. Belarus imported cheap oil from Russia, refined it, and exported it to the West at a significant profit margin.<\/p>\n\n\n\n<p>After Moscow raised oil prices in the 2010s, the Belarusian government introduced market-oriented measures to foster the growth of the private sector. However, the 2020 protests highlighted that an authoritarian system is incompatible with a market economy.<\/p>\n\n\n\n<p>As a result, Russian aid\u2014including direct subsidies and cheap loans\u2014became the primary source of financing. But this came at the cost of a gradual loss of sovereignty. Although formally a separate country, Belarus has become economically dependent on Russia and increasingly aligned with its political interests.<\/p>\n\n\n\n<p><strong>Wages driven by instability<\/strong><\/p>\n\n\n\n<p>Paradoxically, the problems created by the government since 2020\u2014mass emigration and a shrinking trade with the West\u2014have contributed to the pay rise over the past year.<\/p>\n\n\n\n<p>A labor shortage has forced employers to raise wages to attract skilled workers. Additionally, international sanctions have turned Belarus into a transit hub between Russia and Western Europe, generating additional revenue.<\/p>\n\n\n\n<p>However, this growth is unsustainable. The staff shortages are largely the result of the outflow of human capital, and the revenue from gray trade depends on temporary loopholes in sanctions. In this context, wage increases represent a short-term trend that masks deeper systemic issues.<\/p>\n\n\n\n<p><strong>Inflation and shortages cancel out higher wages<\/strong><\/p>\n\n\n\n<p>As inflation erodes the purchasing power of wages, nominal pay increases do not always translate into higher living standards.<\/p>\n\n\n\n<p>Government-imposed price controls have created shortages of goods and reduced profitability, especially in the retail sector. Many stores have already closed, and foreign brands have pulled out of the country. Although store shelves in Belarus are full, the quality of goods has deteriorated, and well-known brands have disappeared.<\/p>\n\n\n\n<p>Belarusians&#8217; salaries continue to lag behind those of their neighbors, and the gap is widening. In 2024, wages in Belarus were lower than in Armenia and Moldova, with an even wider disparity compared to Poland and Lithuania.<\/p>\n\n\n\n<p>This is why state propaganda focuses on comparing current wages with past figures, avoiding comparisons with neighboring countries.<\/p>\n\n\n\n<p><strong>Russia\u2019s support creates illusion of prosperity<\/strong><\/p>\n\n\n\n<p>External support, rather than domestic economic performance, is what drives wages in Belarus. Russian aid constitutes 10 percent of the national budget, and Belarusian companies also benefit from access to Russian state contracts, including in the defense sector. Russian banks have renegotiated debts, while Russian creditors have been lenient about delays in Eurobond payments.<\/p>\n\n\n\n<p>This support has allowed Minsk to create the illusion of revenue growth, which has been particularly important in the lead-up to the 2025 presidential election. High wages, by local standards, are intended to give the population a sense of stability. However, these policies are unsustainable, and the economy lacks new drivers.<\/p>\n\n\n\n<p><strong>Economic stimulus risks failure<\/strong><\/p>\n\n\n\n<p>Belarus plans to stimulate the economy in 2025 through state-led investment. However, experience has shown that such programs typically fuel inflation, which reduces real income.<\/p>\n\n\n\n<p>Although officials are likely aware of the possible consequences, they seem unwilling to question the Belarusian leader\u2019s directives.<\/p>\n\n\n\n<p>The consequences will be felt by officials themselves, who may face reductions in salaries and retirement benefits. The government\u2019s \u201csurvival of the fittest\u201d approach to private businesses and foreign investors has proven ineffective.<\/p>\n\n\n\n<p>It is an established truth, even for Marxists, that the degradation of production tools and the repression of the labor force undermine the foundations of the economy.<\/p>\n\n\n\n<div class=\"insert-block\">\n\n    <div class=\"insert-block__img\">\n        <img decoding=\"async\" width=\"354\" height=\"236\" src=\"https:\/\/pozirk.online\/wp-content\/uploads\/2024\/01\/stroyka_alexey-demidov_pexels.com_-354x236.jpg\" class=\"attachment-medium size-medium\" alt=\"\" srcset=\"https:\/\/pozirk.online\/wp-content\/uploads\/2024\/01\/stroyka_alexey-demidov_pexels.com_-354x236.jpg 354w, https:\/\/pozirk.online\/wp-content\/uploads\/2024\/01\/stroyka_alexey-demidov_pexels.com_-734x490.jpg 734w, https:\/\/pozirk.online\/wp-content\/uploads\/2024\/01\/stroyka_alexey-demidov_pexels.com_-178x118.jpg 178w, https:\/\/pozirk.online\/wp-content\/uploads\/2024\/01\/stroyka_alexey-demidov_pexels.com_-768x512.jpg 768w, https:\/\/pozirk.online\/wp-content\/uploads\/2024\/01\/stroyka_alexey-demidov_pexels.com_.jpg 1128w\" sizes=\"(max-width: 354px) 100vw, 354px\" \/>                        <label class=\"insert-block__tag--mobile\"> The Viewer<\/label>\n\n                <\/div>\n    <div class=\"insert-block__text\">\n                    <label class=\"insert-block__tag\">The Viewer<\/label>\n                <h3 class=\"insert-block__title\">Belarus\u2019 construction push risks economic imbalance<\/h3>\n        <div class=\"insert-block__descr\">Housing construction is once again at the heart of Belarus\u2019 state investment program, alongside investments in the real sector and infrastructure. The government has traditionally relied on construction as a key driver of economic growth. State dominance The construction industry &#8230;<\/div>\n        <a class=\"insert-block__btn-block\" href=\"\/en\/longreads\/124382\">\n            <button class=\"btn\">\n                <div class='btn__text'>Read<\/div>\n            <\/button>\n        <\/a>\n    <\/div>\n<\/div>","protected":false},"excerpt":{"rendered":"<p>The average salary in Belarus reached a record high in 2024. The government highlighted this achievement in the run-up to January\u2019s presidential election. However, economists caution that salaries may decrease due to inflation, as the government plans to expand state-led investments. Bumpy ride State media herald higher salaries as a sign of prosperity and a [&hellip;]<\/p>\n","protected":false},"author":46,"featured_media":62912,"template":"","rubric":[22],"class_list":["post-125151","longreads","type-longreads","status-publish","has-post-thumbnail","hentry","rubric-theviewer"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.5 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Belarus&#039; pay rise seen as unsustainable trend | Pozirk<\/title>\n<meta name=\"description\" content=\"The average salary in Belarus reached a record high in 2024. 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