Open Letter of Economists
to the Belarusian Society


MORE THAN 60 economists
We, the undersigned economists, express our readiness to provide our expertise in order to develop a program of economic reforms in Belarus that will ensure the country's development and increase the prosperity of its citizens. We are ready to use our knowledge and experience to advise the new democratically elected authorities in Belarus.

We firmly believe that Belarus has the capacity to move to a new stage of economic development and increase the quality of people's lives. We see the future Belarus, where every citizen has an equal chance to live up to their full potential, amongst other developed countries.

Today, the economy of Belarus has a number of structural problems that need to be resolved. Should they not be resolved, Belarus will be falling more and more behind its more developed neighbors and the whole world in general in terms of quality of life, while the Belarusian youth will strive to go abroad and realise their potential somewhere else.

The situation is aggravated by a political crisis undermining, among others, economic confidence. In the very short term, it might lead to financial turmoil and welfare reduction of citizens. To prevent that, the current political crisis must be peacefully resolved as quickly as possible. A legitimate government, effective and socially accepted political institutions are crucial for ensuring economic confidence and the functioning of a robust and growing economy.

In order to solve structural problems and achieve sustainable long-term growth, above all, an institutional framework should be established. We believe that it has to be in line with the following principles and guidelines.
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1. Adaptation and development of social infrastructure – education, healthcare, culture, and local governance – according to the values and needs of the Belarusian society

A comfortable social environment is the most important prerequisite for building up human and social capital. In the modern world, social and human capital are regarded as the main drivers of development. With these conditions, the knowledge, skills and expertise of Belarusians will be used in the best and most efficient way. People will have sufficient opportunities for self-actualization and the economy will have its "engine" of growth.

2. Independence of the judiciary from the other branches of government

Confidence in the protection of one's rights, declared in legislation, is a precondition for building long-term strategies of development, spurring innovation, and the functioning of business. This confidence can only be ensured by a just court system. Global experience suggests that the only way to have a just and effective court system is by protecting its independence from the other branches of government.

3. Redefining the role of the State in economic development. The State should stop being a "progressor" that governs and directs economic development and instead become a guarantor of the development of institutions and social infrastructureИзменение роли государства в экономическом развитии.

The State should not intervene in the economy with plans and tasks. The priorities of the State should include guaranteeing sovereignty, preventing crimes, enforcing the rule of law, fair competition, maintaining high-quality infrastructure, healthcare, education, and social protection. These are the ends towards which our taxes should be directed.

4. Creation of an equal and favorable business environment for all enterprises regardless of the form of ownership, size or industry

The state should not impose barriers for inherent redistribution of financial and human resources through business activity, and create artificial mechanisms of support for specific industries and companies. Belarusian citizens should have an opportunity to work where their labor is most efficient and most rewarded.

An important condition for the sustainable development of the private sector is the correspondence of legislation with the actual economic practices. Also, legal gaps should not be the reason for qualifying some activities as economic crimes. The State has to be guided by the principle of goodwill towards business.
5. Improving management efficiency of state-owned enterprises

The share of the state-owned enterprise sector in the economy should be determined by a reasonable balance between their social and strategic functions, on the one hand, and their economic effectiveness, on the other. A comprehensive package of measures is needed to increase the effectiveness of state-owned enterprises (SOEs). First and foremost, it entails changing the incentives for employees and managers of SOEs and separating the roles of the State as an owner and a regulator.
6. Increasing effectiveness and robustness of social protection system

Today the State actively supports enterprises (in particular, state-owned ones). The incurred expenses considerably outweigh the expenses for social security of the population. At the same time, social security payments are carried out without the necessary targeting.

For ensuring a robust and effective social security and addressing income inequality, it is necessary to increase unemployment benefits, enhance targeting of social security payments, carry out constant monitoring of vulnerable groups and swiftly address their needs.
7. Increasing effectiveness and transparency of the labor market, protection of workers' rights

It is crucial that Belarusian human capital is highly qualified. The State should restore self-governance of universities, widen the range of autonomy in schooling. It is also necessary to improve the retraining infrastructure for people. Both the private sector and the State should be able to take part in developing the necessary infrastructure. All the existing barriers prohibiting employees to change their occupation and area of employment at their discretion should be removed.

Simultaneously, it is needed to ensure the adequate protection of workers' rights, among others, within the framework of the system and forms of employment. Independent trade unions also provide an important contribution to this protection. Thus, it is a concern of the State to provide an environment for their sound functioning.
8. Development of the financial market

An effective financial system is extremely important for the country's development. It helps to select the best investment projects and use people's savings effectively.

To ensure the successful development of the Belarusian financial system, it is necessary to get rid of discrediting practices put in place by the State to control the distribution of financial resources. Banks as financial intermediaries should be autonomous in their operations and have to be restricted only by the norms of prudential regulation and supervision. At the same time, it is important to facilitate the development of new financial institutions, markets and sectors (stock market, mortgage lending, accumulative pension funds, investment and innovation funds, financial derivatives, microfinancing for small businesses, insurance, etc.)
9. Developing digital infrastructure to increase transparency of public administration and economic relations

Belarusians could mobilize their talents in IT and engineering to build a knowledge-based economy and a digital society. Digital literacy, universal internet and computer access should be the norm in Belarus. The State should actively support the development of digital infrastructure in education and public services (e-government).
10. Improving the competitiveness and innovativeness of the economy through the promotion of entrepreneurship, creation of a startup ecosystem and development of venture investments

The next major innovation breakthrough might happen not only in the research laboratories but also thanks to the new wave of free entrepreneurs that are the vanguard of innovative thinking in the new economy and the key to the dynamic society.
11. Prioritization of macroeconomic and financial stability in monetary and fiscal policy

Economic authorities should not abuse the instruments available to them for chasing short-term phantoms of economic welfare at the expense of long-term welfare losses and financial turmoil. The government should strive to ensure fiscal balance and sustainability of sovereign debt. The central bank should be independent from the government and be responsible for price stability and financial system stability.
Certainly, these principles do not address all the problems of the Belarusian economy. Our goal is to delineate main priorities for the reforms that are necessary for the development of the country and raising social standards as the current model of socio-economic development in Belarus has proven unable to do so.

If focusing on building institutional fundamentals Belarus can also expect external credit and grant support of such kind of reforms.If focusing on building institutional fundamentals, Belarus can reasonably expect external credit and grant support for economic reforms. Commitment to economic reforms and closer cooperation with international financial institutions will solidify economic confidence and improve the country's image. This will also facilitate the decrease of the cost of external borrowings for the country, securing lowering expenses on public and private debt servicing.

We hope that Belarus will soon become a prosperous country. If called upon, it will be our honour to provide our expertise for that.
Signed (in the alphabetical order):
  1. Adaskevich Maksim, Financial Analyst, Duff & Phelps Germany GmbH
  2. Aginskaya Hanna, Researcher, BEROC Economic Research Center; PhD in Economics
  3. Akulava Maryia, Researcher, BEROC Economic Research Center; PhD Candidate, Kozminski University
  4. Aleś Alachnovič, Vice-President, CASE Belarus
  5. Amialchuk Aliaksandr, Associate Professor, University of Toledo; PhD in Economics
  6. Andreev Pavel, Associate Professor, University of Ottawa; PhD in Economics
  7. Apanasovich Tatiyana, Associate Professor, George Washington University; PhD in Economics and Statistics
  8. Arshavskiy Victor, Research Fellow, BEROC Economic Research Center; PhD in Economics
  9. Babenko Ilona, Associate Professor, Arizona State University; PhD in Economics and Finance
  10. Babicki Dzmitry, Senior Researcher, CASE Belarus
  11. Becker Torbjörn, Director, Stockholm Institute of Transition Economics; PhD in Economics
  12. Belskaya Olga, Assistant Professor, Ohio University; PhD in Economics
  13. Bogdanov Ilya, Director, fintech company Nest Egg
  14. Boreiko Dmitri, Assistant Professor, Free University of Bozen-Bolzano; PhD in Economics
  15. Bornukova Kateryna, Academic Director, BEROC Economic Research Center; PhD in Economics
  16. Chaly Serge, Independent economist
  17. Charankevich Hanna, PhD candidate, University of Virginia (USA)
  18. Charnavoki Valery, Assistant Professor, New Economic School (Moscow); PhD in Economics
  19. Chepikov Mikhail, Senior Lecturer, Belarusian State University, Faculty of Economics
  20. Daneyko Pavel, Economist
  21. Dzeraviaha Ihar, Associate Professor, Belarusian State University, Faculty of Economics; PhD in Economics
  22. Enikolopov Ruben, Rector, New Economic School (Moscow); PhD in Economics
  23. Fedaseyeu Viktar, Associate Professor, China-Europe International Business School (Shanghai), Faculty of Finance; PhD in Economics and Finance
  24. Fridkin Leonid, Independent economist
  25. Gontmakher Evgeny, Professor; Doctor of Economics; Deputy Minister of Social Protection of Russia (1993-1994); Head of the Department of Social Development of the Government Office of Russia (1999-2003)
  26. Gorodnichenko Yuriy, Professor, University of California, Berkeley; PhD in Economics
  27. Guriev Sergei, Professor, Sciences Po, Paris
  28. Hancharonak Ales, Junior Research Fellow, BEROC Economic Research Center
  29. Hartwell Christopher, Professor, Bournemouth University Business School (UK); PhD in Economics
  30. Iosub Vadim, Financial analyst
  31. Ivanovich Dmitry, Independent economist
  32. Jaščanka Halina, Chairman of the Council of the Belarusian Institute for Strategic Studies (BISS); Consultant at McKinsey (2007-2016)
  33. Korosteleva Julia, Associate Professor, University College London, School of Slavonic and East European Studies
  34. Kruk Dzmitry, Research Associate, BEROC Economic Research Center
  35. Kuhto Yulia, Associate Professor, Belarusian State Economic University; PhD in Economics
  36. Livshits Igor, PhD in Economics
  37. Lukin Sergey, Associate Professor, Belarusian State University, Faculty of Economics; PhD in Economics
  38. Lvovskiy Lev, Research Fellow, BEROC Economic Research Center; PhD in Economics
  39. Manysheva Kristina, PhD Candidate, Northwestern University
  40. Marinich Tatsiana, Founding Director, Imaguru; Lecturer, IE Business School, Madrid
  41. Marozau Radzivon, Research Associate, BEROC Economic Research Center; PhD in Economics
  42. Mazol Aleh, Researcher, BEROC Economic Research Center
  43. Medvedev Andrei, Senior Associate, Financial Services Authority (UK); PhD in Economics
  44. Mikloš Ivan, President of the Slovak think tank MESA10; Deputy Prime Minister and Minister of Finance of Slovakia (2002-2006, 2010-2012); Deputy Prime Minister for Economy (1998-2002); Minister of Privatization (1991-1992)
  45. Mudryk Aliaksandr, Associate Professor; PhD in Technical Sciences; independent expert in human resources
  46. Mylovanov Tymofiy, President; Kyiv School of Economics; Professor, University of Pittsburgh (USA); Minister of Economic Development, Trade and Agriculture of Ukraine; Deputy Chairman of the Council of the National Bank of Ukraine
  47. Naryvonchyk Dzmitry, Investor; Сolumnist, Economic Newspaper (Belarus)
  48. Naŭrodski Sierž, President, CASE Belarus
  49. Pliashkou Evgeny, Trader, Optiver company
  50. Pranovich Mikhail, PhD in Economics
  51. Samaryna Hanna, PhD in Economics, University of Groningen
  52. Shamshur Anastasiya, Professor, University of Kent; PhD in Economics and Finance
  53. Shymanovich Gleb, Economist, IPM Research Center
  54. Sokal Dzmitry, Associate Professor, Belarusian State University, Faculty of Economics; PhD in Economics
  55. Sonin Konstantin, Professor, University of Chicago; PhD in Economics
  56. Stanchev Krassen, Professor, Sofia University (Bulgaria); Committee Chairman of Bulgaria's Constitutional Assembly (1990-1991); Member of the Presidential Economic Policy Council, Bulgaria (1996-2011)
  57. Tserlukevich Yuri, Professor, Arizona State University; PhD in Economics and Finance
  58. Tsiulya Alena, Research Assistant, BEROC Economic Research Center
  59. Vetelkina Anna, Senior Lecturer, Belarusian State University, Faculty of Economics
  60. Vysotskaya Zinaida, Senior Lecturer, Belarusian State University, Faculty of Economics
  61. Yatsynovich Yury, Quantitative Analyst, Citizens Bank; PhD in Economics
  62. Zaretski Aliaksandr, PhD Candidate, Emory University

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