Alexander Lukashenko is asking Belarus’s districts to match the performance of Shklov, his home district. Yet the wider system he wants them to emulate remains dependent on billions of roubles in state support, with many agricultural enterprises still making losses even after receiving subsidies.
The contradiction was on display on 9 November 2026, when Lukashenko met the heads of all 118 districts in Shklov, in the Mogilev region. Media reports published the following day said he presented the district as an example and urged the other 117 to raise themselves to its level.
What the comparison did not address was the unequal starting point. Shklov is Lukashenko’s birthplace and has traditionally received particular political attention and public investment. That does not establish that every project there has been wasteful. It does mean that its results cannot automatically be treated as a neutral benchmark for districts without comparable access to state resources.
A target without equal means
Belarus’s regional economy is tightly controlled from the centre. Local administrations have limited scope to increase their own revenues, attract investment or overcome infrastructure and economic disadvantages accumulated over many years. An instruction from Minsk can set a target, but it cannot by itself build roads, modernise enterprises or create jobs.
To bring the other 117 districts genuinely up to Shklov’s level, the state would need to provide similar investment and subsidies across the country. That would require substantial additional budget resources. Without them, local officials are being told to reproduce results under conditions that may be fundamentally different.
The arrangement creates a political risk as well as a financial one. A centrally supported district can be displayed as evidence that the system works, while poorer results elsewhere are blamed on local management. The gap, however, may reflect decisions made at the top as much as the performance of district administrations.
It is an especially awkward model to promote because agriculture sits at the heart of rural development policy. State-owned farms and enterprises descended from the collective-farm system continue to rely on budget transfers, subsidised loans and other forms of government assistance. That support can prevent an immediate collapse, but it has not made the sector consistently profitable or self-sufficient.
Billions in support, thin returns
Belarusian agricultural organisations received nearly 7.8 billion roubles in state support and concessional loans in 2024, figures cited by Belsat show. For every rouble invested, the sector generated only 46.3 kopecks in net profit.
That figure does not mean every farm performed in the same way. It does indicate that public money is doing more to keep existing operations going than to change the economic weaknesses beneath them.
A review of 13 agricultural enterprises in the Mogilev region in 2025 found that seven were loss-making even after subsidies were included. The result does not, on its own, explain the reasons for each enterprise’s losses. It does show how difficult it is for financial assistance to overcome poor productivity, weak management or business models that require permanent state backing.
Independent Belarusian economists cited in the reporting identify several structural causes: centralised decision-making, limited competition and insufficient accountability for managers of chronically loss-making enterprises. In such a system, another allocation of money can preserve an organisation without giving it a strong reason to restructure.
The same reporting says roughly two-thirds of Belarusian agricultural enterprises are loss-making or effectively dependent on state assistance. Taken alongside the Mogilev findings, that points to a long-running system problem rather than a temporary setback affecting a handful of farms. Subsidies may protect production and employment in the short term while leaving the causes of recurring losses intact.
The answer keeps coming back to funding
Lukashenko has repeatedly called for stronger support for rural areas. On 6 November, he acknowledged that the state sometimes does not even know where money allocated to the countryside ends up. At the same time, he did not rule out increasing agricultural financing.
That combination captures the weakness in the policy. The government recognises that oversight and efficiency are inadequate, yet continues to present additional funding as the principal remedy. After 32 years in power, Lukashenko is again promising greater support for the countryside, even though the sector remains heavily reliant on public intervention.
State aid can serve legitimate short-term purposes, including protecting food production and employment. The unresolved question is whether the money is being used to alter the conditions that produce losses or simply to delay their consequences.
In a more competitive system, persistent losses might force an enterprise to change its management, restructure or leave the market. Under Belarus’s centralised agricultural model, continued access to state assistance can reduce that pressure. Managers who are judged against centrally imposed targets but do not control the resources needed to meet them have an obvious incentive to seek another transfer from Minsk.
That is why the Shklov example matters beyond one district. If a favoured territory is used as proof that ambitious development targets are achievable, while other districts lack comparable means, the benchmark may encourage more demands for state financing rather than more efficient local economies.
The immediate consequence is a costly cycle: the centre sets targets, districts seek resources and public money keeps weak enterprises operating without resolving the causes of their weakness. Until competition, oversight and responsibility for chronic losses change, asking 117 districts to become another Shklov looks less like a development plan than an instruction without the means to carry it out.
