Minsk Retains its Internal Policy
On 8 September, the Chairman of Belarus’ Central Election Commission, Yarmoshina, said that reforming the election legislation was undesirable. Last week, a number of high-ranking officials stated that it was unacceptable to sell Belarus’ national assets.
The current task for the Belarusian authorities is to maintain the status quo. It is not expected that they will fulfill the political demands both of the West (such as the release of political prisoners and democratic reforms) and of Russia (the privatization of enterprises under the loan program of the EurAsEC).
Last week, Yarmoshina said that there were no plans to transform the standing majority electoral system into a proportional one. Later on, two of the three First Deputy Prime Ministers, Vladimir Semashko and Sergei Rumas, stated that privatizing major Belarusian companies (Belaruskali and BelAZ) would be a crime against the Belarusian people and was not acceptable.
Such “tough rhetoric” is explained by Minsk’s unwillingness to fulfill the demands of the Kremlin and the West to carry out reforms. At the same time, such demands increase the unanimity within the governmental bodies on the most worrying issue: the privatization of the Belarusian enterprises within the frameworks of agreement on cooperation with the EurAsEC Anti-Crisis Fund. The issue will be discussed during Putin’s visit to Minsk on 31 May.
As it has already been indicated, the Belarusian authorities have no long-term strategy.
However, there was significant growth in Belarusian foreign trade in the first quarter of 2012 due to favourable terms for trade in oil and oil products with Russia. Minsk wants to derive a maximum short-term benefit from this situation as well as to put off making economic and political concessions. It increasingly uses extremely adventurous but highly lucrative smuggling schemes to re-export Russian oil products without paying export taxes to Russia.
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.