Kremlin is ready to provide limited support for Belarusian econom

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April 22, 2016 19:08

The Kremlin offered support for the Belarusian economy by enabling Belarusian enterprises to participate in the Russian import substitution programme. The Belarusian authorities count on financial assistance from Russia to stitch-up economic imbalances if negotiations with international creditors, such as the IMF lead to no avail. Meanwhile, amid growing crisis in the Belarusian economy, the Belarusian authorities want to ensure socio-political stability in the country.

Last week, Presidents Lukashenko and Putin held a bilateral meeting and discussed prospects of Russo-Belarusian cooperation. The meeting took place right before the Supreme Council of the Union State, which focused mainly on mutual trade barriers and ways to remove them.

Belarus’ Prime Minister Kobyakov and Russian PM Medvedev signed an intergovernmental plan to improve conditions for trade and economic cooperation. According to the plan, in the following six months, favourable conditions for mutual trade should be restored. In addition, Minsk and Moscow signed a number of intergovernmental agreements on migration and social issues.

At the opening session of the Supreme State Council, President Lukashenko spoke in favour of greater powers and functions of the EAEC. Most likely, his statement has meant to set a good background for talks with Putin. In particular, after the bilateral talks, President Putin said that Belarus and Russia intended to create a common visa space. However, official Minsk is unlikely to grant additional powers to supranational bodies. The Belarusian Foreign Ministry’s Press Secretary Mironchik later underscored, that single visa space was “not a matter of one day or even one year”, that it required “involvement and participation of our common foreign partners”.

There were no official reports about Russia and Belarus reaching a loan agreement. Russian Finance Minister Siluanov confirmed that the parties did not consider "the issue of a loan for Minsk”. In addition, the EurAsEC Anti-Crisis Fund deterred the consideration of the remaining tranche for Belarus until May. In June 2011, the EurAsEC ACF decided to allocate a USD 3 billion loan for Belarus, however the last trance of that loan had not yet been transferred due to the fact that the Belarusian authorities had not complied with 10 of 14 loan requirements.

Meanwhile, Minsk is counting on positive response from the IMF regarding the Government’s package of measures to stabilise economy, which the authorities are trying to present as structural economic reforms. The annual regular IMF mission will work in Belarus until March 16th.

Since the authorities do not have sufficient funds to buy the loyalty of the population with wage growth, they strengthen their power policy. Upon his return from Moscow, President Lukashenko met with senior staff of the Interior Ministry, MIA Troops and students from the Internal Troops Faculty of the Military Academy. In recent years, the president has been meeting the stat security forces regularly, including his recent visit to the Defence Ministry.

During the meeting, President Lukashenko warned against possible destabilisation in socio-political environment, “I have reiterated this many times, but I find it necessary to emphasise once again that ‘maidan’ will not happen in Belarus. We have to fully preserve the rule of law and our own country”. In addition, amid Russian invasion of Ukraine, there are fewer supporters in the Belarusian opposition of the revolutionary scenario, which could lead to the change of power through mass protests on election day.

President Lukashenko underscored that provocations could take place during the Victory Day celebrations (May 9th). In the face of rising tension in the region, the Belarusian authorities seem to fear attempts to destabilise the situation in Belarus, demonstrating therefore their readiness to cope with such threats.

Official Minsk continues to regard the Kremlin as the main creditor in the event of a crisis in the Belarusian economy. Simultaneously, the authorities believe they should demonstrate their willingness to control the socio-political environment in the country independently.

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The Belarusian authorities regard the Catholic conference as yet another international event to promote Minsk as a global negotiating platform. Minsk’s proposal to organise a meeting between the Roman-Catholic Church and the Russian Orthodox Church is rather an image-making undertaking than a serious intention. However, the authorities could somewhat extend the opportunities for the Roman-Catholic Church in Belarus due to developing contacts with the Catholic world.

Minsk is attempting to lay out a mosaic from various international religious, political and sportive events to shape a positive image of Belarus for promoting the Helsinki 2.0 idea.

Belarus’ invitation to the head of the Holy See for a meeting with the Patriarch of the Russian Orthodox Church should be regarded as a continuation of her foreign policy efforts in shaping Minsk’s peacekeeping image and enhancing Belarus’ international weight. The Belarusian authorities are aware that their initiative is unlikely to find supporters among the leadership of the Russian Orthodox Church in Moscow. In Russia, isolationist sentiments prevail.

In addition, for domestic audiences, the authorities make up for the lack of tangible economic growth with demonstrations of growth in Minsk’s authority at international level through providing a platform for religious, sportive and other dialogues.

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