Smuggling to rescue Belarus’ international trade
In January – May 2014, the foreign trade deficit persisted, regardless of some improvements, compared with 2013. The slump in production has resulted in reduced commodity imports and, consequently, Belarus’ gross imports. International trade indicators might improve due to potash sales and new trading schemes for petrochemicals.
In January-May 2013, the trade balance deficit was USD 1.6 billion. In January - May 2014, Belarus’ foreign trade deficit was USD 0.7 billion, i.e. there was a certain improvement over the previous year. These improvements were due to shrinking imports of goods, compared with Belarus’ exports. Exports reduced by USD 0.36 billion compared with 2013, while imports – by USD 1.2 billion. The state of affairs in the Belarusian industry explains the above-mentioned misbalances.
Imports have curtailed mainly due to the industrial sector. Imports of internal combustion engines for trucks, ferrous metals, natural gas, and equipment for modernisation have reduced. Simultaneously, imports of consumer goods have increased. Higher incomes have resulted in an increase in imports of fruits, vegetables, fish, dairy products, and confectionery. The state is trying to fight against consumer imports with licensing and other restrictions, but their efficiency in the context of an open border with Russia, is low. Foreign trade has improved due to the growth in sales of potash and compound fertilisers on foreign markets.
In its attempts to overcome the international trade deficit, the Belarusian government lays its hopes on potash sales and on the petrochemicals. Belarus has managed to restore oil product sales (up to 2013 standard), and increased exports of bituminous mixtures and antioxidants. The latter are exported to the United Kingdom and might be a modification of the solvent and lubricant schemes, used in 2011-2012. Back then, these schemes enabled Belarus to report about foreign trade surplus in goods, for the first time in several years. In 2014, the export scale is more modest, but given the growth in potash sales and provided that restrictions on imports remain in place, Belarus might reach a surplus in international trade.
Now the main issues is whether Russia agrees to these schemes, which is quite likely, due to the agreement reached within the Common Economic Space and further integration processes.
Thus, Belarus’ foreign trade has demonstrated some improvements, at the cost of production slowdown in some industries. Before the year end, Belarus might achieve the international trade surplus, if she continues to sell potash fertilisers on foreign markets and increases supplies of petrochemical products through new ‘innovative schemes’.
The Belarusian authorities regard the Catholic conference as yet another international event to promote Minsk as a global negotiating platform. Minsk’s proposal to organise a meeting between the Roman-Catholic Church and the Russian Orthodox Church is rather an image-making undertaking than a serious intention. However, the authorities could somewhat extend the opportunities for the Roman-Catholic Church in Belarus due to developing contacts with the Catholic world.
Minsk is attempting to lay out a mosaic from various international religious, political and sportive events to shape a positive image of Belarus for promoting the Helsinki 2.0 idea.
Belarus’ invitation to the head of the Holy See for a meeting with the Patriarch of the Russian Orthodox Church should be regarded as a continuation of her foreign policy efforts in shaping Minsk’s peacekeeping image and enhancing Belarus’ international weight. The Belarusian authorities are aware that their initiative is unlikely to find supporters among the leadership of the Russian Orthodox Church in Moscow. In Russia, isolationist sentiments prevail.
In addition, for domestic audiences, the authorities make up for the lack of tangible economic growth with demonstrations of growth in Minsk’s authority at international level through providing a platform for religious, sportive and other dialogues.