Minsk is attempting to play down human rights issues in relations with EU
The Belarusian authorities aim to raise the profile of the geopolitical aspect in the Belarusian-European relations to enhance economic cooperation. That said, Minsk shows discontent with Europe’s persistence regarding Belarus’ compliance with her human rights commitments and attempts to slow down the dialogue on human rights and democratisation. The Belarusian authorities aspire to preserve the current political liberalisation without harsh persecution of the opposition, but with the use of financial mechanisms to curb protest activity.
The Belarusian Foreign Ministry has sharply reacted to the critical resolution of the European Parliament, which, however, is unlikely to affect Minsk’s commitment to the Belarusian-European normalisation. The Belarusian authorities hope that the document adopted by European MPs will not slow down the steady positive cooperation between Minsk and European capitals. According to the Belarusian authorities, geopolitical conflict with Russia is a crucial factor for developing Belarusian-European relations, and Minsk’s attempts to become the "regional stability donor" compensate for the lack of democracy and violations of human rights in the country.
The Belarusian authorities seek to give an additional impetus to relations with the European capitals, to update Minsk image as a stability donor in the region and put forward additional peace initiatives. For instance, the president suggested that Belarus could participate in the peacekeeping mission in Donbass, and Minsk could host the settlement process for Western capitals and the Kremlin. The Belarusian leadership hopes that such initiatives would drive away the West’s attention from the critical assessments of the human rights situation in the country.
Minsk is attempting to link financial assistance with strengthening of the Belarusian independence in order to pay down the value aspect in the dialogue with European capitals. From pragmatic cooperation with the EU, Belarus expects assistance in obtaining credit support from international institutions, assistance in joining the WTO, restoring trade preferences for Belarusian goods on the EU market, and signing a basic agreement between Belarus and the EU. Visa liberalisation issue seems to be less important for the officials in Minsk.
The Belarusian authorities do not see the need to continue political liberalisation with regard to political opposition and human rights in the country in the near future.
The Belarusian economy was shrinking for the second year in a row, in 2016, by 2.6%. Before 2015, the Belarusian economy was growing for 18 consecutive years. In order to stop the economic slump, Belarus needs a favourable international market situation and to settle all trade disputes with Russia. The Belarusian economy is unlikely to recover before 2018.
According to the preliminary reports, in 2016, Belarus had a 2.6% GDP decline. The Belarusian economy was shrinking for the second year in a row – a 3.8% decline in 2015. Most economic indicators in 2016, except in agriculture, had negative values. Wholesale trade had the most negative impact on GDP due to falling exports of potash fertilizers and petrochemicals, as well as construction, due to reduced investment in fixed assets by enterprises and decreased housing construction volumes.
In 1996-2011, the Belarusian economy was growing most rapidly, average GDP growth rate was 6.9% per year. In 2011, amid emission injections in the economy, disproportionate growth of wages against the background of low productivity and significant financial aid for loss-making agricultural, construction and industrial enterprises, the Belarusian rouble depreciated by three times. The absence of economic reforms and significant relative weight of state in the economy amid deteriorating external economic environment led to a sharp economic slowdown – circa 1% per year in 2012-2014; the slowdown was followed by the recession, caused by a slump in the prices for basic exports from Belarus and cuts in soft loans issued to maintain production volumes.
Belarus’ budget for 2017 is based on anticipated 0.2% growth. The expected decrease in the construction volume is circa 17% in 2017, which is unlikely to allow industrial growth with the renewal of fixed assets by legal entities. Even if wages grow, they will be offset by the 15% increase in utility tariffs by late 2017. Wholesale trade is largely dependent on the potash market situation and the oil processing volume at the Belarusian refineries. In view of the planned reduction in Russian oil supply in Q1 2017 to 4 million tons, wholesale growth is only possible provided the potash market situation improves. In late 2016, engineering output increased significantly, but amid the trade conflict with Russia, she may prioritise purchases from domestic manufacturers. In the given circumstances, Belarus’ GDP would only grow in 2017, provided the Russo-Belarusian dispute over energy supplies was fully resolved, Russia removed barriers for Belarusian exports and the potash market situation improved. That said, Belarus’ GDP in 2017 is likely to decrease by 0.5% - 1% and is likely to be followed by an attempt to overcome the recession in 2018.
The Belarusian economy has been in recession for two consecutive years. Amid anticipated decline in retail trade, construction and unresolved dispute over energy supplies from Russia, economic recession is likely to persist in 2017 and the economic recovery may be postponed until 2018.