Belarus got an infection in 2005. But it has nothing to do with medical diseases. Despite strong anti-Western messages from the country's leadership, the Belarusians have successfully entered the Western society of total consumption. The Keynesian theory of anti-saving has become a prominent feature of Belarusian society. People in Belarus used to save 17 to 20 percent of their income as a rule. In 2005 this indicator fell below four percent. "Spend now! Tomorrow will be good!" has become a motto of the hot Belarusian economy.
People's incomes amounted to 30.3 trillion rubels in the first ten months of 2005, a 28.5 percent increase in comparison with the respective period in 2004. Prices rose by 10.8 percent over the same period. As much as 25.1 trillion was spent on buying goods and services. Taxes accounted for 3.8 trillion, or 12.7 percent. Savings and stock investment took 1.2 trillion, or just 3.8 percent.
For comparison, 17.4 percent of all people's incomes was used for making savings, investing in stock market and buying hard currency cash. The respective figures for 2002 and 2003 were between 18 and 21 percent. In addition to their incomes, people borrowed much more from banks last year. Consumer loans grew by almost 80 percent to 1.17 trillion in the first eleven months of 2005. It was virtually a boom.
People tend to save when they think that their future is uncertain and something has to be stored for a rainy day. In the first four years of the just expired five-year programming period of 2001-2005 they showed a rather cautious attitude to GDP growth figures, government's triumphant economic reports and colossal government investments. The year of 2005 seems to have been decisive in convincing them in the efficiency of the economic policy. It brought a mass feeling of nearly euphoria: if the government spends so much, why can't we? This is how average citizens thought last year. They were even more eager to think so, because the government gave repeated promises to support them in case something happened.
The situation of consumption in Belarus in 2005 is very much reminiscent of the situation in Russia in 1997 and in the first half of 1998, when many in that country thought that they managed to cheat the business cycle. That they did not need savings. That it was patriotic and good to consume as much as possible. The cold shower of a financial crisis in August 1998 in Russia showed that economic laws were as certain and stable as laws of physics or chemistry. Belarusian banking system is now ready to step into the same shoes.
Cotton products accounted for the largest growth in consumption in the country's stores (excluding markets and kiosks). Taking into account the fact that the top ten fast growing commodities in 2005 included clothing, knitwear, underwear and footwear, one can say that the consumer boom was mostly about body wear.
Food and drinks were the second most important spending items for Belarusian households. People bought 26.7 percent more of alcoholic drinks in the first ten months of 2005 than one year earlier. Canned fish, cheese and eggs were also rather successful among consumer, with their sales growing by 27.3, 19.2 and 15.3 percent, respectively. As many as 136,200 tons of meat, 130,600 tons of sausages and 6,334 tons of milk products were bought in 2005. A ten-percent increase was registered for all those commodity groups.
As for durable goods, the boom mostly focused on refrigerators: their physical sales rose by 19.3 percent. Thus, consumption in Belarus in 2005 was at such a scale that one could conclude that people did not see any crisis in the following several years, that Belarusian banks were solid financial rocks in the unstable ocean of world finances. They stopped thinking about tomorrow and "got infected" with consumption fever. It is obviously an example of people adapting their tendency to depend on the state to the state's policy of raising their incomes administratively. If the government decided to raise incomes, the people were glad to spend them in stores. Retail trade rose to 21.2 trillion, or 19.9 percent year-on-year, in the eleven months of 2004.
However, many people do not buy things in stores but prefer markets and private kiosks. The country's retail trade turnover is 63 to 65 percent through stores and 35-37 percent through markets.
Expert estimations show that the total growth of Belarusian commodities sales in retain trade, including stores and market, accounted for 70.4 percent in the first three quarters of 2005; 80.5 percent in foodstuffs and 59 percent in non-food products.
Thus, the trend to consume has become of one of basic economic features in 2005. However, there are reasons to believe that the Belarusians are too early with their decision to refrain from reasonable saving. People in Japan have had a savings ratio at 30-35 percent of their incomes for decades. This is why they became rich. To hope for a rain of gold, endless generosity of Russia and a miracle that Belarusian companies can suddenly start to produce internationally competitive products is too naive. But it was not trendy to think about that in 2005.

Commodity trade growth in Belarusian stores, January-October 2005