Expert: What to sell after Beltransgaz?
Economic observer Tatstsyana Manyonak expressed her opinion in the interview with Euroradio, that high gas prices will make the Belarusian government consider reforms.
Euroradio: Belarus and Russia have resumed negotiations about gas supplies in 2012 and about the privatization of Beltransgaz by Gazprom. What should we expect from the negotiations?
Tatstsyana Manyonak: According to the press service of Gazprom, there is nothing to expect now – the deal will be made only at the beginning of December. The main problem (gas price for Belarus in 2012) has not been solved yet. It would be ideal for Belarus to have the average Russian domestic price – the gas price used in the provinces bordering Brest Province.
Of course, Russia will not allow it. Russia claims that the price will be European minus the beneficial indexes promised by Putin in connection with Belarus’ membership in the Customs Union. As far as I understand, the main Belarusian problem will be the base price the indexes will be used with. Belarus needs the minimal price close to the Russian one because it is said that the single economic space is starting to function. The competition will increase.
Belarusian enterprises cannot hope for another devaluation because the economic agreements signed in this field take the inflation rate into account. Belarus risks to be excluded from the Customs Union if it fails to fulfill the comments. However, it is still only an idea mentioned in the agreement.
It is not clear whether it is going to be fulfilled; nevertheless, the competition will be increasing. Belarus will have a hard time trying to compete if it has higher gas prices – the difference already exceeds 120 dollars. That is why the trade will be hard. Russia does not only need Beltransgaz, it needs the assets of the other leading enterprises.
Euroradio: How will the average European price affect ordinary people?
Tatstsyana Manyonak: We do not know whether we will have the average European price or not. However, the price is rather high. There is competition in the European market and the price tends to decrease. Moreover, the indexes are a benefit. Nevertheless, it is worth noting that cheap gas is not very good for the Belarusian economy. The high price will make the Belarusian government consider the restructuring of the economy, reforms and alternatives. Anyway, Gazprom is a monopolist.
We can observe it in Ukraine – the country is considering an alternative and will soon announce a tender for the construction of a liquefied gas terminal. Belarus has also been invited but it has not given an official reply yet. It is necessary to think about an alternative.
Being a monopolist, Gazprom will keep increasing the price despite the fact that it is decreasing in Europe. European companies demand to reconsider the formula itself and the trade of European companies with Gazprom as well the situation in Ukraine can help Belarus.