Milking Oligarchs, Political Modernisation, MSQRD – State Press Digest

Mark Zuckerberg making MSQRD selfie

Economic difficulties push Belarusian authorities to extraordinary ways of gathering revenues. They continue arrests of top businessmen, regardless of their position in Lukashenka's apparatus, on tax evasion charges, allegedly waiting for a big payoff.

In domestic politics, the authorities try to modernise Belarus' political system and raise the role of loyal political parties and associations without introducing major changes to the authoritarian model.

Belarusian programmers sell MSQRD, an IT startup, to Facebook. All of these and more in this edition of State Press Digest.

Politics

KGB head Vakuĺčyk: there are no sacrosanct people in Belarus. Belarus Segodnya publishes comments made by Belarusian KGB head Valier Vakuĺčyk on the recent arrest of Belarus' top businessman Jury Čyž, as well as other high-rank businessmen detained earlier this year. In addition, to Vakuĺčyk's explanation around the ambiguous tactics used to evade taxes, he also provided some additional details on the subject.

Vakuĺčyk said that he personally took decision to arrest Čyž, since he is not on the staff list of the president and does not need a sanction for arrest. “If I let him go, I would be responsible for that and could appear in his shoes now. There are no sacrosanct people in Belarus, and some wrongly think that appearing on a photo with the president or playing hockey with him gives them immunity”, Vakuĺčyk said.

The authorities want loyal political parties to build in the political system. Belarus Segodnya highlights the meeting of deputy head of Presidential Administration Ihar Buzoŭski with the leadership of pro-government political parties and civil associations ahead of parliamentary elections scheduled for this autumn.

“Political parties need to show concrete positive actions aimed at building civil society, economic and social development, and this concerns not only electoral campaign period”, the official said. He added that political parties and civil associations can become effective sites for public dialogue, channels of public opinion and developers of policy proposals.

Pro-government political parties have become passive since the 1990's, because the centralised political system of Belarus does not accept multiple political actors. Apparently, the authorities try to modernise the system and invent new functions for the half-dead loyal political parties.

Eurasian integration

Post-Soviet space needs reindustrialisation and a new integration idea. Ahead of the 25th anniversary of the formation of the Commonwealth of Independent States (CIS), newspaper Soyuz. Belarus-Russia interviews Russian political scientist, of Belarusian origin, Kiryl Koktyš on the future of post-Soviet integration. According to the expert, previous relations across the post-Soviet space were built around “oil rivers” and participation of former Soviet countries in the trade of Russian hydrocarbons. Today, the countries need to introduce a new model, based on production rather than export of natural resources.

The old concept of an Eurasian Union is dead and the new one has not yet emerged. Designed as a replica of the European Union, it failed to implement free movement of people, capital, goods and services, and after sanctions war demonstrated a complete failure. However, the post-Soviet leadership cannot offer a new idea of integration and each country has its own interests towards Russia.

Economy

Russia aims to boost gas transit via Belarus. Russian gas giant Gazprom has developed an extensive investment programme for Belarus, reports Soyuznoye Veche. It will invest $2,5bn in modernising the Belarusian system of gas transport with one billion of the sum going towards underground gas storage. Moscow is also contemplating the creation of a new pipeline Yamal-Europe-2 from Russia to Central Europe via Belarus.

Kremlin plans to stop transit via Ukraine after 2019, and Belarus is considered a more reliable partner for transiting Russian hydrocarbons. However, Poland, backed by the EU and US, is blocking Moscow's plan for pipeline expansion. Therefore, the future of boosting Belarusian transit capacities remains unclear.

Belarus works on diversification of food export. According to Seĺskaja Hazieta, by 2020 the government plans to split the food export to 30%-30%-30% for the Eurasian Union, the EU and third world countries. Diversification of export becomes a crucial task for food producers in Belarus, as the Russian market, which currently absorbs 94% of Belarus food production, will be gradually contracting. Until 2020 Russia plans to reach around 90% of self-sufficiency in food according to its security doctrine. Yet by now only 2 of 46 diary companies of Belarus managed to enter the market of the non-Eurasian Union countries.

As for the EU market, only 10 Belarusian companies have certificates for selling their products in Europe. The trade with the EU is complicated due to the European protectionist agricultural policy which contains high import tariffs. Moreover, due to economic crisis Belarusian food export in 2015 fell by 26% compared to 2014.

Business

Facebook buys successful Belarusian startup MSQRD. Mobile application for making selfies with masks of celebrities, superheroes and animals emerged only four month ago and has already reached over 15 million downloads. The unique technology seemed so promising that Mark Zuckerberg decide to purchase the startup, writes Soyuznoe Veche. The exact price remains a secret, but is estimated at $100-150m.

MSQRD founder Jaŭhien Neŭhień says that they created the technology over three days and were surprised by its popularity. Shortly after, numerous media celebrities started to post selfies with MSQRD and it rapidly spread around the world. The application became another IT breakthrough from Belarus, following World of Tanks, Viber, and maps.me.

Social

Released gangsters try to revive the old order. A few recent criminal cases of debt extortion reminded Belarus of the 1990's, when the criminal world thrived here, writes Narodnaja Hazieta. In the beginning of the 2000's the authorities implemented a vast crackdown on criminal mobs, and those convicted have been released recently and are trying to revive the old order. Homiel police official Andrej Zajac explained that most former gangsters after spending a decade in prison do not want to work legally and seek criminal sources of income.

However, they find it difficult to work in the new situation, because law enforcement works more effectively than it did in the 1990's-2000's. They try to engage in extortion racket of drug dealers or simply go to Russia where they find more opportunities for this activity. “This is the result of many years of tough work, and if not properly controlled, the gangsters can regain power within a year”, the official said.

The State Press Digest is based on review of state-controlled publications in Belarus. Freedom of the press in Belarus remains restricted and state media convey primarily the point of view of the Belarusian authorities. This review attempts to give the English-speaking audience a better understanding of how Belarusian state media shape public opinion in the country.

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