Russo-Belarusian alliance terms deteriorate
Minsk and the Kremlin abstain from escalating information tension in bilateral relations. Meanwhile, Moscow has not relaxed pressure on the Belarusian government and put the oil and gas dispute on hold. Despite the fact that the Kremlin has not voiced a clear position, apparently, it has serious claims to Minsk either about integration, or about privatisation.
Last week, Russian Ambassador to Belarus Alexander Surikov said that all controversial oil and gas issues would be resolved in the near future.
The Russian authorities have not issued any public statements about the detention of the pro-Kremlin writers for REGNUM news agency by the Belarusian law enforcement. Perhaps the Kremlin wants to abstain from an escalation with its closest ally before the holiday season. In turn, the Belarusian authorities also did not continue the information confrontation with the Kremlin. That said, the article in the Sovetskaya Belorussia, Presidential administration’s newspaper, about Russian Agricultural Administration head Dankvert was frankly feeble.
Amid neutral information background, the Kremlin continues to exert pressure on Minsk. For instance, the Eurasian Development Bank postponed the transfer of the third tranche worth USD 300 million to Minsk. The EDB insists on the adoption of two presidential decrees: first, to raise unemployment benefits for laid off from reorganised enterprises; second, to transfer insolvent companies to trust management. These two decrees should give a start to closing insolvent companies.
Russia promised to increase oil supply to Belarus in Q1 2017 to 4.5 million tons, which in fact is a reduction as compared with Q1 2016. Only if Belarus pays out due debt for gas at USD 425 million, Russia will supply 24 tons of oil in 2017, which would still be two tons less than in previous years.
Simultaneously, Russia offered a subsidy: Belarus would be able to export three million tons of oil without processing and keep the oil duty in her budget (the duty on oil is double the duty on petrochemicals). However, this subsidy is less than the reduction in the gas price for other Gazprom clients (USD 300 million in total) and is inconsistent with the principle of netback parity stated in the agreements.
Overall, even if Belarus fully complies with Moscow’s terms, oil and gas cooperation with Russia will deteriorate in 2017, and if the dispute spins out - relations will deteriorate even more. That said, the delay in repaying due debt for gas will lead to the deterioration of the oil and gas cooperation terms. In 2016, Russia will undersupply circa 5.5 million tons of oil to Belarus and the Belarusian budget will not earn more than USD 220 million from export duties on petrochemicals.
Publicly, the Kremlin has not formulated clear requirements for Belarus to resume oil supplies and oil benefits in full. Different public officials voiced various requirements for resolving the oil and gas dispute and improving access to the Russian market for Belarusian products. Inter alia, they proposed: to introduce a single visa policy, establish a single agricultural control service of the Union State, deploy a new Russian military base in Belarus, reorient Belarusian transit via Russian North-Western ports, and resume five integration projects on privatization of Belarusian state assets (including MZKT).
Minsk is under strong pressure of the Kremlin, which refuses to accept arguments previously used in bilateral relations.
Yet the Belarusian authorities have not taken any action to prevent massive protests against the decree on ‘social parasites’. On February 26th, 2017, multiple protests against the decree were held in three Belarusian regions in Vitebsk, Baranovichi, Brest and Bobruisk (more than 4 000 people participated in total). Very likely, the authorities, on the one hand, anticipate that the decree will be abolished, and other hand, do not want to take responsibility for decisions either on the decree or on the protests.
It should be noted, that the mass street protests on February 17th, 19th, and 26th, were held in the absence of the president in the country. There are reasons to believe that the authorities did not expect such a massive action. The state propaganda responded tangentially, insisting that protests were unjustified, because ‘the state did not require a lot’, despite the fact, that the protesters primarily complained about the lack of jobs in the country. In addition, the protesters pointed to the unfairness of the requirement to pay the tax for being unemployed as the state could not provide job and money making opportunities, while people were humiliated by the need to prove to the state they were unable to pay the tax.
In the past ten days, there were several protests against the decree, which were characterised by the following: the protesters easily picked up anti-Lukashenka slogans; they eagerly shared their outrage with journalists; many protesters said it was their first time when they took to the streets; protesters were ‘common people’, i.e. not political activists; there were fewer white-red-white flags during these protests than during conventional oppositional actions; politicians, who organised protests (eg on February 26th, by the centre-right coalition and the independent trade union) did not attempt to take the lead, especially in the regions. All this gives a picture of truly popular protests.
While refraining from interfering with the meetings and protest marches, the militia on February 26th attempted to put pressure on the protest organisers in the regions by handing out reports on administrative violations after the events. Other than that, it appears that the local and central authorities are unable to respond to the massive protests against the Decree No 3, including crowded street speeches, numerous signatories of petitions (over 80 000), multiple collective and personal appeals to the authorities, and mass meetings.
That said, the authorities are unable to enforce the Decree No 3 as they do not have sufficient resources to trial some 400 000 people for non-compliance. In addition, the authorities do not have sufficient institutional capacity to exempt all those not liable for the tax from the mailing lists of the Tax authorities. The Belarusian Bar Association will provide free legal consultations on March 1st, 2017 for those wishing be exempt from the tax imposed by the Decree No 3, however, this would only slightly east the tension in society.
In addition, despite concerns expressed by some experts and the leader of the protest in Minsk on February 17th Mikola Statkevich, there were only scarce reports in the Russian media about the protests in Belarus.