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Opinions & Interviews

24 Mar 2020

Belarus’ economic decisions in face of coronavirus pandemic justified

Belarus’ economic decisions in face of coronavirus pandemic justified
Aleksei Avdonin. An archive photo

MINSK, 24 March (BelTA) – Belarus takes the most prudent and balanced decisions to manage the economy in conditions of the coronavirus pandemic, BelTA learned from Aleksei Avdonin, an analyst with the Belarusian Institute of Strategic Research (BISR).

The Belarusian government is considering a set of measures to support doing business. Members of the parliament are working on their own proposals to soften the blow of the coronavirus situation to the economy. Enterprises are expected to get tax holidays while people with bank loans will get repayment holidays.

Aleksei Avdonin said: “It is important to separate the medical measures being taken to fight COVID-19 and the media coverage that has evolved due to this reason. In Asia, Europe, and the USA they are coming to the conclusion that strict restrictions such as quarantine at enterprises, air travel restrictions were enforced due to a wave of panic.”

For instance, the USA expects a considerable decrease in the GDP in the second quarter of the year. According to various estimates, the unemployment rate may reach 20-30%, which would be comparable or even more than the unemployment rate registered during the Great Depression. “It is understandable that the authorities fear such a situation. Any economic hardships will lead to social problems, including a growing crime rate. The USA understands that strict measures need to be taken to prevent a decrease in production, prevent companies from going bankrupt, and prevent massive unemployment,” the BISR analyst noted. After evaluating the damage to the economy the American authorities are going back on their decisions. On 24 March U.S. President Donald Trump said that the decision on when enterprises will be reopened will be made early next week. The president stated America would be reopened for business soon. Apart from that, Washington does not consider the possibility of enforcing new restrictions on entering the USA due to the coronavirus situation and has no plans to restrict travels inside the country. The authorities and the U.S. Federal Reserve had to rapidly inject massive amounts of U.S. dollars into finance in order to fight negative economic consequences. As much as $356 billion has been injected within one week. The Federal Reserve System has never done anything like that in the course of more than 100 years of its history.

The entire world understands that it is necessary to prevent an economic slump in the wake of the new coronavirus and the panic it has caused. “It is recognized not only in the USA but also in the European Union, which has promised to allocate about €40 billion to the most affected economies,” Aleksei Avdonin noted. Considerable resources have been appropriated in order to support the tourism industry and quarantined companies. Financial resources are being allocated by governments, banking structures, and major companies.

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