Can Belarus Retaliate Against New US Sanctions?
Today the U.S. Department of the Treasury sanctioned four Belarusian enterprises of Belneftekhim Concern, Belarus’ largest petrochemical conglomerate. Sanctions hit some of thee most profitable state-owned companies in Belarus - OAO Naftan, OAO Grodno Azot, JSC Grodno Khimvolokno and OAO Belshina. The U.S. government froze all assets of these companies within its reach and prohibited U.S. persons from engaging in commercial or financial transactions with them.
Ironically, today Belarusian President pardoned nine participants of December protests against falsification of presidential elections. Names of those pardoned have not been released yet and it is unclear whether some of the former presidential candidates will be released. According to Belarusian official press, they wrote personal requests to President Lukashenka asking to pardon them.
Although most of the sanctioned companies do little business in the United States, losses to the already struggling Belarusian economy may be significant. Belshina is one of Europe’s largest tire manufacturers. Naftan is a subsidiary of Belneftekhim Concern that produces petroleum products. Also a subsidiary of Belneftekhim Concern, Grodno Azot and Grodno Khimvolokno are Belarus' largest petrochemical plants manufacturing fertilizers, fibers and consumer goods. Belarus Government will have to privatize some of its most lucrative enterprises because of the ecoomic crises. Being on the U.S. sanctions list will certainly make these companies less attractive to investors.
Since 2007 the United States targeted several companies affiliated with Belneftekhim for being owned or controlled by Belarusian President Alexander Lukashenka. The U.S. sanctions against undermining democratic processes, human rights abuses and political oppression in the country. Today the State Department reiterated its call on the official Minsk to release immediately and unconditionally all political prisoners.
Proponents of sanctions argue that they are the only language which the official Minsk understands. Unlike Europe, the United States has almost no economic interests in Belarus and can afford wide-scale sanctions. Earlier this year Europe also introduced economic sanctions against but they stopped short of any serious measures. Europe depends on oil and gas transits though Belarus. More importantly, it is difficult for all EU member states to reach consensus on how to deal with Belarus. It appears that in the United States both Democrats and Republicans are committed to follow the same tough policy towards Belarus.
What can do Minsk in response to the new US sanctions? In 2007, following the introduction of the US sanctions, most of the US Embassy staff had been expelled from Belarus. This time, Belarusian authorities will look for ways to retaliate again but they may be too weak to escalate the conflict. The country is in the midst of the worst economic crises since the collapse of the Soviet Union and is eagerly looking for financial aid. Perhaps the only move which the official Minsk could do would be to expel the remaining U.S. diplomats from Minsk.
However, this will not inflict any serious damage to the U.S. interests in the region and will shut down opportunities for direct communication with the world's only remaining superpower. Belarusian authorities still hope to obtain a loan from the International Monetary Fund, which the United States can easily block.
Official Minsk may also further strengthen repressions against political opponents to demonstrate that they are undeterred by the new sanctions. Under this scenario, Belarus may lose more than gain. This will make the prospect of normalization of relations with the West even more remote. However, when balancing the prospects of losing power and normalizing relations with the West, Belarusian authorities may opt for political survival and more dependence upon Russia.
When Belarusian authorities intensify human rights violations and the West imposes sanctions in response Belarus' dependence upon Moscow increases even more. Moscow comes out as the only geopolitical winner for the time being.
Regardless of possible long-term efficiency of sanctions, the West should not overlook a more important task of supporting civil society in Belarus. Weakening the Belarusian regime is easier but not necessarily more effective than strengthening a real alternative to it.