Belarusian authorities manage to protect their interests vis-à-vis the Kremlin

Category status:
April 22, 2016 18:14

The Belarusian authorities are successfully practising ‘political judo’ with Russia: they receive the necessary economic benefits and do not make required concessions in return. Minsk’s strategy is to get the most from the Eurasian integration project and to justify the lack of reciprocal concessions by the economic and political risks associated with this same integration.

On July 18, a meeting of the Council of Ministers of the Belarus-Russia Union State took place in Minsk. As a result, an intergovernmental general contract for the construction of a nuclear power plant in Belarus with 2400 megawatts generating capacity has been signed in Minsk.

This project, worth about USD 10 billion is critically important for the image of Belarus. Long-term energy generating facilities construction is not only a symbolic investment into the future Belarusian energy independence, but also a significant enhancement of the President Lukashenko’s political legitimacy for at least the next 5 years (launching of the first energy unit is scheduled for 2017).

In turn, Belarusian authorities have once again managed to postpone reciprocal measures concerning assets privatization. On the eve of Prime Minister Dmitry Medvedev’s visit to Minsk, President Lukashenko visited Belaruskali headquarters and said that the controlling stake in this company will not be sold. The President did not rule out sales of individual shares, given the overall enterprise’s costs assessment at USD 30-32 billion. De facto, such high assessment effectively means the refusal to sell Belaruskali shares.

Moreover, Belarus postponed the privatization of MAZ until the beginning of the autumn and got away with solving another controversial issue – the probable oil exports from Belarus under cover of solvents and lubricants in order to avoid duties’ payment to the Russian budget.

Concerning the latter, a mild request of Prime Minister Medvedev “to find out and punish those responsible” is most likely to be ignored by Belarus, while the very profitable scheme of evasion of export duties will be upgraded (for example, solvents exports will be replaced with another product with similar production technology). Experts assess that Belarus makes from USD 700 million to USD 1 billion per year from this scheme, while Russian budget fails to receive relevant amounts from duty payments.

Therefore Belarus’ negotiating strategy remains unchanged and so far successful: to get the maximum possible benefits from the economic cooperation with Russia and to postpone the fulfillment of counter measures as far as possible. Belarus did the same after the visit of the Russian President Vladimir Putin to Minsk on May 31st, when privatization of MAZ was discussed. Repeated reference to this issue by Prime Minister Medvedev during the Summit on July 18th, implies this issue has not been resolved.

Therefore, one should anticipate that the same rules will apply to the future visit of the new Russian government delegation to discuss privatization issues. For instance, Belarus will point out to the risks associated with Russia’s WTO accession and will try to add additional compensational conditions to the already reached agreements, which, de facto, will once again postpone their implementation.

Similar articles

Belarusian and Ukrainian Defence Ministries entangle in confrontation spiral
October 02, 2017 11:57
Фото: RFRM

Over the past year, military-political relations between Minsk and Kyiv have become complicated. Due to their high inertia and peculiarities, this downward trend would be extremely difficult to overcome.

The root cause of the crisis is the absence of a common political agenda in the Belarusian-Ukrainian relations. Minsk is looking for a market for Belarusian exports in Ukraine and offers its services as a negotiation platform for the settlement of the Russo-Ukrainian war, thereby hoping to avoid political issues in the dialogue with Kiev. Meanwhile, Ukraine is hoping for political support from Minsk in the confrontation with Moscow. In addition, Ukraine’s integration with NATO presupposes her common position with the Alliance in relation to Belarus. The NATO leadership regards the Belarusian Armed Forces as an integral part of the Russian military machine in the western strategic front (the Baltic states and Poland). In addition, the ongoing military reform in Ukraine envisages a reduction in the number of generals and the domestic political struggle makes some Ukrainian top military leaders targets in politically motivated attacks.

Hence, the criticism of Belarus coming from Ukrainian military leadership is dictated primarily by internal and external political considerations, as well as by the need to protect the interests of generals, and only then by facts.

For instance, initially, the Ukrainian military leadership made statements about 100,000 Russian servicemen allegedly taking part in the Russo-Belarusian military drill West-2017. Then the exercises were labelled quazi-open and military observers from Ukraine refused to provide their assessment, which caused a negative reaction in Minsk. Further, without citing specific facts, it was stated that Russia was building up its military presence in Belarus.

Apparently, the Belarusian and Ukrainian Defence Ministries have entangled in a confrontational spiral (on the level of rhetoric). Moreover, only a small part of the overly hidden process has been disclosed. That said, third states are very likely to take advantage of the situation (or have already done so). This is not only about Russia.

The Belarusian Defence Ministry officials are restrained in assessing their Ukrainian counterparts. However, such a restraint is not enough. Current military-political relations between Belarus and Ukraine are unlikely to stabilise without the intervention of both presidents.

Recent trends