On the face of it, the arithmetic of Belarusian agriculture is simple and clear, but a closer look at it can be rather perplexing. Government experts estimate that direct and indirect subsidies and subventions to the farming sector will amount to $1.5-1.7 billion in 2005. Net profit of the country's farms totaled 383.2 billion rubels, or nearly $180 million, for the first six months of this year. At the same time, overdue accounts payable amounted to 903.7 billion rubels as of July 1, which is more than twice larger than the profit. Tax and duty arrears alone account for 201.5 billion rubels. With such indicators in place, the Ministry of Agriculture and Foodstuffs reports nevertheless that the share of unprofitable farms is just 5.1 percent, or 104. Just one year ago the respective figure stood at 25.6 percent.

  Obviously, the logic of Belarusian agricultural officials is very different from that of private company managers. Any private enterprise understands that it always needs to reconcile profit and loss. In contrast, Belarusian farms work more like huge workshops of one state enterprise, the Ministry of Agriculture and Foodstuffs. And this enterprise in turn is a chronic recipient of funds from public budget, banks and many industrial companies. Tax pressure on agricultural production is very low, loan resources are cheap, subsidies are regular, energy resources are subsidized and equipment, plant protecting agents and fertilizers are for low prices. They should really try hard in such conditions to operate at a loss and delay debt repayment. But why to repay debts at all? The government can always come to help.

 The same observations apply not only to agriculture but also to other so-called strategic sectors. The state sees no limits in its generosity. Even common sense fails to stop it.

 Public budget indicators are often changed several times to fit with the needs of the farming sector. This August Alyaksandr Lukashenka issued Edict #355 "On Financing Grain Purchases in 2005 and Making Amendments in Public Budget Indicators" to introduce more changes to the country's main financial document. The purpose of this edict is to provide government guarantees for 272.5 billion rubels as loans for purchasing grain.

 The following day the head of state ruled to increase expenditures of public budget. He ordered that the Fund for Support of Agricultural Producers could spend an additional 204 billion rubels.

 There is indeed no limit to the government's spending on agricultural producers. The Council of Ministers adopted a resolution on August 26 to provide "government guarantees for the repayment of loans." And it entered into force on July 20, 2005, i.e. more than one month before it was actually issued. Authorized banks now get guarantees for low-interest loans to a number of companies founded by state-run bakeries in Hrodna, Lida and Minsk. As soon as the harvesting period starts, farms rush to get another lump of budgetary resources or cheap loans. Rassvet Postavsky, an agricultural and construction company in the Vitsyebsk region, has been very lucky this year. The Council of Ministers issued a decision on August 29 to give to the company a budgetary loan of 450 million rubels for three years. About two weeks earlier the cabinet gave a generous present to a state produce processing company in Mahilyow. It got 600 million rubels "for conducting the seasonal collection of berries and apples, and for purchasing sugar and raw materials for wine production" for one year. So, it turns out that Belarusian agricultural enterprises are so "advanced" that they are not even able to collect apples without budgetary support.

 Here is another example. On July 7, the Council of Ministers adopted a resolution to provide budgetary loans to regional authorities. Under this document, taxpayers' money will be distributed to regional governments "to bridge the gap in cash payments caused by preparations of grain harvesters and other grain processing equipment for the harvesting campaign of 2005." Six regional governments received 13 billion in total. The Minsk region got the biggest piece: 3.05 billion. Vitsyebsk got one billion for purchasing "domestic tractors." So, Belarusian industry will also get something from the public budget. All this budgetary generosity is needed, the government says, to make foodstuffs cheaper and better. But this is only in theory. In real life, average Belarusians often prefer foreign-made food. People in western regions travel back and forth between their homes and Poland or Lithuania. In eastern regions, they travel to buy food in Russia, and in the south, to Ukraine. Even residents of Brest, who have so patriotically preferred their vodka brands, are now more disposed to Ukraine's Nemiroff. Even Latvian and Russian communists lose their enthusiasm in praising Belarusian agricultural policies when they see prices for meat and sausages in Belarus.

 With such huge subsidies in place, a kilo of Belarusian pork could cost about one dollar and a kilo of high-quality sausage - about three dollars. Such generous support could make bread much cheaper. Low prices would be a true indicator of efficiency for the Belarusian government's agricultural policy. But they are non-existent. Agriculture is now a social rather than business project for the country's leadership. And all Belarusians have to contribute to this project twice: when paying taxes and when buying food.