Minsk has relaxed tension with the Kremlin, but conflict potential in Russo-Belarusian relations retains
Minsk was prompted to make the first step to resolve the lingering oil and gas dispute and repay the gas debt. The Belarusian authorities have accepted the diminution in gains from the Eurasian integration and demonstrated a commitment to close relations with the Kremlin. Minsk is likely to attempt to gain more benefits from the Kremlin, which could once again cross the interests of Russian partners on gas and food markets, and eventually lead to tension in Russo-Belarusian relations.
According to the Russian newspaper Kommersant, the discount on gas for Belarus in 2018-2019 would be "less than 20%".
Minsk has repaid its USD 726 million debt for Russian gas within the 10-day period stipulated at the meeting in St. Petersburg. Yet it is unknown where the money came from. That said, the agreement on the terms of Beltransgaz privatization has been amended and the clause on Gazprom monopolistic deliveries of natural gas to Belarus has been removed, which creates a potential for a lower gas price. As agreed, Russia has resumed 24 million tons oil supplies to Belarus for 2017, of which 6 million tons will undergo customs clearance and will not be processed at Belarusian refineries to compensate for gas costs.
The Kremlin has defended its position regarding the introduction of a single energy market as of 2025, while Minsk insisted on earlier deadlines. Moscow has agreed to refinance, not to write off, its loans issued to Minsk, thereby increasing Belarus' financial dependence on Russia. Rosselkhoznadzor has initiated the creation of transport corridors to Uzbekistan, Tajikistan, Azerbaijan, Iran and Belarus, which could potentially reduce Belarus' revenues from transit and processing of European produces. In addition, border controls, unilaterally introduced by Russia at the Belarusian-Russian border were not called off.
There are no media reports about possible negotiations between Russia and Belarus over the deployment of a Russian airbase in Belarus, nevertheless the military-technical cooperation between the states remains very close. In addition, Minsk has demonstrated its commitment to the Eurasian integration and President Lukashenka attended the EEU Summit in Bishkek in person. Moreover, Minsk signed the EEU Customs Code before the Summit in Bishkek, which prevented a crisis in the Kremlin's integration project.
Overall, Minsk and Moscow have broken tension in bilateral relations; however, the potential for confliction retains and could manifest itself already this year.
Amid budgetary cuts on social protection, the Belarusian public sector is experiencing a management crisis and a balance shift in the state resource redistribution system. The authorities are forced to revise their most unpopular decisions during the implementation due to the pressure from affected social groups. The state is unlikely to oppose to some civil society and opposition organisations in strengthening their role in society in order to retain touch with the population and to be able to respond to the most harsh criticism of state initiatives.
The Architecture and Construction Ministry has acknowledged that the decree No 585 on assistance to large and young families in building and buying housing was prematurely rescinded.
The authorities are often forced to revise their decisions on curtailing social assistance to different social groups during their implementation, without preliminary impact assessment and feedback from the population, so as they lead to the growth in social tension. Due to the centralised decision making, languishing state resources and the lack of public debate as a balancing instrument in issues related to social protection, the state administration is losing control of the population.
Perhaps, the compensatory mechanisms of the state apparatus lack the time to adjust to dwindling state resources for supporting the existing social model, even in a reduced form. The authorities have completely or partially paralysed operations of independent public institutions and representative bodies, through which they could monitor public moods and receive feedback from the population, such as local councils, the parliament, political parties and NGOs. Last year, under the pressure of the authorities, the last independent institute for measuring public sentiment, IISEPS, suspended operations.
President Lukashenka’s self-removal from the decision-making on current socio-economic issues, also could have affected the state apparatus’ operations. The president has always been very sensitive about adopting unpopular decisions which could lower his popular support, hence demanded a careful preliminary assessment of such decisions. However, recently, especially after the introduction of the tax on social dependants, the president has mainly focused on the foreign policy agenda.
Hence, a lacuna has formed in the state decision-making after the president reduced participation in the current socio-economic policy formation, which leads to an increase in manifestations of dysfunction in the public administration.