Belarus set to use EEU mechanisms to resolve disputes with Russia
Belarus and Russia seem unable to resolve the bilateral dispute and are prompted to use mediation of the EEU agencies. The oil and gas dispute is likely to be resolved within the framework of this organisation. If this happens, Belarus will start to benefit from participating in the EEU.
Last week, the EEU agencies joined the conflict between Belarusian food producers and the Federal Service for Veterinarian and Vegetation Sanitary Supervision. In addition, the EEU Court confirmed the validity of Russian claims to Belarus in the case of equipment transit from Kaliningrad.
On February 22nd, the Eurasian Economic Commission ministers (the EEC is the executive body of the EEU) for industry and agro-industrial complex Valery Koreshkov and Sergei Sidorsky responded to the Federal Service for Veterinarian and Vegetation Sanitary Supervision (Rosselkhoznadzor) claims. In particular, they stated that at that moment the EEU had no approved methodology to determine the milk powder concentration, neither on the EEU, nor on the national level, including Russia. The Rosselkhoznadzor promotes methodology, which was developed by a commercial enterprise and was not approved by any national or supranational authority. The EEC stated that the Rosselkhoznadzor improperly used the said methodology, and therefore, the ban on Belarusian dairy products was unjustified.
Earlier, Sergey Sidorsky proposed to establish the Eurasian Association of Milk Producers in order to coordinate the interests of national producers on the EEU market. By establishing different industry associations, the competition between companies could actually be reduced and help to divide the market.
Last week, the parties somewhat progressed in resolving the oil and gas dispute, also through cooperating within the EEU. According to statements by Energy Minister Potupchik and Vice Prime Minister Semashko, the dispute would be resolved through creating a common electricity market by 2019 and a common gas market by 2025, which, according to Belarus, required coordination of the gas price in Russia and Belarus. Perhaps, Russia did agree to apply some indices when pricing gas for Belarus, but in any case, Belarus declared a willingness to abandon cross subsidies for energy tariffs on the domestic market.
The Labour and the Tax Ministries are considering the possibility to include persons engaged in some economic activity without forming a legal entity in the social security system. When the decree No 337 comes into effect, the number of private entrepreneurs is likely to reduce due to the possibility of reducing the tax burden when switching to a tax payment as an individual. 95% of self-employed, including PE, pay insurance premiums on the basis of the minimum wage. The number of self-employed citizens is expected to increase, the number of insurance contributions to the pension system from PE will decrease, the number of citizens who will pay a fee to finance government spending will decrease by several tens. Self-employed citizens have the alternative not to pay social security fees and save resources for future pensions, which, given the gradual restriction by the state of pension requirements could be a more long-sighted option.