Belarus attempts to sell parliamentary elections to the West
Makey’s appointment as Foreign Minister means that Belarus will try to ’sell’ a liberalization illusion to the West in exchange for loans from international financial institutions. Makey and Prokopovich will be selling this illusion until there is a new beneficial framework for cooperation with Russia.
Staff reshuffle on August 20th, should, first of all, be interpreted as a measure to improve the search for foreign funding in the context of pre- and post-elections pressure on the Belarusian economy in general and on Belarusian ruble in particular. The Belarusian authorities have clearly lost their hope for the restoration of an adequate foreign currency income from Russia (about USD 2.5 billion in six months).
This implies, Belarus needs to consider either a large sale of state property (which is fairly complicated), or get new loans, or agree on refinancing of previous loans from international organizations (the IMF in particular). The recent staff reshuffle fits the bureaucratic system’s logic, i.e. that the local internal rearrangement should result in the anticipated external changes.
It is noteworthy that Makey’s dismissal as Presidential Administration Head has been long awaited. In fact, Makey failed as Head of Administration and after the December 19th events had lost President’s confidence significantly and, therefore, his weight in the administration. His resignation was deliberately coincided with the start of the active part of the election campaign - to indicate the possibility of changes in the Western policy, and to send a signal to the nomenclature about minor adjustments in the game’s rules.
In a wider perspective, the replacement of Sergei Tkachev as Presidential Aide on economy with Peter Prokopovich, as well as shifting Makey from the Presidential Administration to the Foreign Ministry aimed to update the authorities’ symbolic façade in order to facilitate negotiations with the IMF.
All this is meant as a fast and effective solution: to ‘sell’ the parliamentary elections with a view to resume negotiations with the IMF. At the same time, the authorities do not anticipate the recognition of the legitimacy of the Belarusian Parliament, for them the recognition of “progress” and “some democratization” in the electoral process in Belarus would be enough.
President Lukashenko had seriously restricted the room for maneuver in the upcoming negotiations. While introducing Makey and tasking him with normalizing the relations with the EU, he said, “We are ready to study hard and to learn everything new and advanced, and not only from them, but we want to do it without urges, threats or blackmail. Our people’s psychology is that you cannot make them jump through several development stages and turn out in “a happy democratic future”. These words need no further comments.
According to Decree No. 221 of June 23rd, 2017, deadlines for the completion of foreign trade operations have been extended from 90 to 180 days for exports and from 60 to 90 days for imports. Delayed payments entailed a fine up to 2% of the transaction cost for each day of the delay, but could not exceed the total cost of the transaction. Most companies, when working with new counterparties, require a deferred payment for a period of three to six months. Due to the new regulation, violations are likely to reduce in number, so as the fines. Trade enterprises are likely to expand the assortment list due to the supply of new products in small lots, and the assortment list of exported Belarusian goods could expand, too. The new terms for completing foreign trade transactions would enable medium and small companies on the foreign trade market, exporters and importers are likely to grow in number and the geography of export-import operations could expand.