Belarus: China’s most special partner

Arseniy Sivitsky, Center for Strategic and Foreign Policy Studies(Belarus, Minsk)

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In May the Belarusian authorities, on the one hand, continued reducing the pressure trying to get back to the policy of the national unity, and avoiding both Russophobia and  any accusations towards to the West. On the other hand, they were obliged to incur the expenses, connected with the crisis in February-March, 2017.

Internal policy: Games on the “populist” left-of-centre pitch

The main “liberal” event of the period under review was the registration of the campaign “Tell the truth”  as a non-governmental organization, after seven years of such efforts. This is the first in Belarus within the last decade registration of a significant political structure referring itself to the opposition. This event caused a storm of various comments. However, the idea is clear and transparent: being in need of carrying on the process of the relationships normalization with the Western countries, authorities move towards the liberalization of the political space, but in what is  considered to be the safe way.     

The meeting of Aleksander Lukashenko with the chairman of the Belarus Federation of Trade Unions (BFTU) Mikhail Orda had important influence on the evolution of the midterm Belarus internal policy. During the conversation the president supported the BFTU’s initiative to establish a “people’s control” over the prices: every month members of  the working group have to check the groceries prices in the shops. What is more, the president also confirmed the federation’s “responsibilities” in assistance and protection of the population employment, as well as their fight for the salary increasing.

Thus, authorities, promoting economy reforms agenda at the same time create polittechnological tools for their active gaming on the “populist” left-of-centre pitch.

Noteworthy was the fact that the Belarus president used the meeting with the leader of the state trade unions in order to bring up the issue of party construction. In particular, the president stated that he doesn’t oppose the parties development in Belarus. In this context, Lukashenko mentioned two major structures for h the president to support: they are the BFTU and the Republic non-governmental association (RNGA) “Belaya Rus”. Nevertheless, he did not show any signals of transforming one or both of these structures into the parties.

  Economy: Government’s optimism vs. international financial institutes’ estimations

The period under review was marked with some positive economical dynamics and raise of the optimism among the Belarusian authorities. Such position was determined by the gas and oil conflict resolution, as well as the new credit agreements, made with Russia last month.

Despite this, in its May review of the regional economy  the European Bank for Reconstruction and Development predicts 0.5% recession level in 2017 in Belarus. The International Monetary Fund also foresees keeping of recession of 0.8% in Belarus. World Bank predicts 1% tendency of the recession.

The analysts of the international rating agency Fitch Ratings   suppose that the credit renewal from the Eurasian Fund for Stabilization and Development (EFSD) and the regulation of the conflict on energy with Russia decrease but don’t eliminate uncertainty about the Belarus’ ability to successfully implement the funding scheme in 2017. The Belarus government’s financing plan means the enlargement of the non-debt-based incomes in a foreign currency to $1.8 billion in 2017, to comparing to $1.2 billion last year and EFSD’s $1 billion payoffs.

Although it is unlikely to abuse the use of Beijing’s political weight, nevertheless, but anyway in some critical situations any political and technical support from China may be not just necessary, but also essential for the Belarus government

At the same time,  several experts believe that reducing of the external liquidity risk prior to the payment deadline for the $800 million Eurobonds in January, 2018 will also depend on some additional foreign currency sources involving, and as a result, on the other components of the financing plan. Among these components they name a return to emissions on the international capital market, which, as the state predicts, will provide $800 million and the ability of the state to attract more borrowings in a foreign currency to the internal market

Belarus vulnerability in the external financing area determined by both low gold and foreign currency reserves and high net external debt is a long-term drawback for the creditability.

External policy: Influence of China factor

The main event of the month was Lukashenko’s visit to the People’s Republic of China  to participate in Forum “One Belt, One Road” in Beijing on 14-16 May,.

The relations with China at this stage appear to be very advantageous on all counts. As the forum revealed, due to the consistent participation in this Chinese initiative, Belarus gets the status of one among few close partners of the second most powerful state in the world. This symbolical capital is important not only for the country, but for the Belarus leader himself.

From objective point of view, partnership with China for Belarus opens the opportunity to hedge its foreign policy risks. Although it is unlikely to abuse the use of Beijing’s political weight, nevertheless, but anyway in some critical situations any political and technical support from China may be not just necessary, but also essential for the Belarus government. Finally, from the practical point of view, the collaboration with China promises a great number of investments, credits, and last but not least technology.

During the meeting between Lukashenko and Xi Jinping, the Belarus leader emphasized the importance of Belarus-China relations in the field of security, including military sphere and collaboration between the special services. Creation of the common permanent working  group on combating ”colour revolutions” and countering international terrorism, internal separatism and religious extremism was announced.

In addition it was stated that the Belarus State Secretariat of Security Council and the China Ministry of Public Security are approaching the signing of new agreement, which will promote establishing tighter contacts in such important directions as the consecutive and expert work, coordinated migrant policy.

In other words, in security area the Chinese “balancing” influence on the Belorussian national security environment can get institutionalized. Both great resources and considered professional position of Chinese experts in this sphere can become a real factor in ensuring stability and security in Belarus.

Lukashenko also announced that Belarus and China will continue the collaboration in military-technical sphere. Particularly, it concerns modernizing multiple-launch rocket system “Polonaise”” (extending shooting range up to 300 km), developing modern arming and military technology samples and other export-oriented military and dual-use products.

Oleksandr Lukashenko’s statement that Belarus supports China in its determination to “assume the obligation to protect global peace” was politically important. Including this statement into public materials of press service obviously aimed at signaling Russian side about Minsk’s intention to support “multipolarity” in the security sphere in Eurasia.