The year 2013 will probably go into the economic history of Belarus as a year when even the government officials acknowledged that the economy was stagnating, and there were no prospects for any quick economic growth in the years to come. The official economic forecast for 2014 contains a modest GDP growth number of 3.3% (compared with 8.5% forecast for 2013), the Belarusian ruble will continue to be devalued (the only question now is how quickly) and despite the promises of Russian loans, Belarus faces the possibility of a 2011-like currency crisis.
On 14 January, Aliaksandar Lukashenka signed Decree No.1 “On some issues of state regulation of poppy seed circulation”. The decree provides a number of actions to establish control over the import of poppy seeds to Belarus. Poppy seeds, or bubki in slang, remain a major cooking ingredient and also a leading opiate drug in Belarus. Until the decree came into force, anyone could sell bubki freely, with considerable profits being turned over in the small, but lucrative business. Today, the estimated number of addicts in Belarus reached 150,000 people, or 1.6% of the total population. This number has grown almost threefold since 2004.
The Belarusian game World of Tanks has become one of the most profitable in the world, earning $372m in 2013. The game, with 60 million users, is only one instance that shows how Belarusian IT business is achieving considerable successes and becoming global. Viber, the smartphone messaging and calling client, has become one of the most popular applications in the AppStore and Google Play, and EPAM Systems creates software for the largest companies in the world. These are just some of the world's leading companies with their roots in Belarus.
Eastern Europe is central to Jewish history, but the region today lacks Jewish heritage sites. Very few landmarks commemorate the millions of Jews exterminated there during WWII, or their role in local culture and society before the Holocaust. A new project, “Shtetl Routes: Vestiges of Jewish Cultural Heritage in Transborder Tourism”, aims to address this problem: by November 2015, tourist trails honouring the Jewish heritage of Belarus, Poland, and Ukraine will link the border regions of the three countries together.
Earlier this year, Belarusian media published an interview with Belarusian oligarch Iuryi Chyzh. The businessman predicts problems with the Russian economy, supports the diversification of Belarusian enterprises and states that Russia is grabbing the biggest piece of the pie in the Customs Union. Chyzh is right. Belarus remains too dependent on Russia economically: half of Belarus' trade is with Russia. The Kremlin controls the competitiveness of the Belarusian economy through its energy shipments, since without Russia`s energy subsidies Belarusian goods will quickly become too expensive.
Channel 1 covered an official award giving ceremony honouring prominent Belarusians. Alexander Lukashenka introduced his fellow citizens to the new Patriarch of Belarus Orthodox Church Pavel with warm words. Will the Belarusian-Chinese cars 'Geely' become an international hit? The head of state discussed this project with the Prime Minister Michail Miasnikovich and the Minsk Regional Governor Siarhei Shapiro.
Leading up to New Year's Eve and throughout the first week of 2014, employees of the Minsk municipal ambulance service launched a protest. They are demanding a raise in salaries and improved labour conditions. The healthcare sector in Belarus remains financed by the state and has one of the lowest average salary rates of any profession. Among its neighbours, Belarus allocates the smallest portion of its GDP towards healthcare, which has resulted in its gradual decline in recent years. This policy has led to a personnel shortage and has put considerable stress on the nation's healthcare services.
The western press covered a number of Belarus-related issues over the past month, though the economy remained their primary focus. The long-rumoured potential sale of state-owned assets to Russian investors appears to be moving forward. This news is closely tied to Russia providing Belarus with a new $2bn loan, a deal which was commemorated in Sochi with an All-Star Hockey game.
On 4 January, the Belarusian army deployed a third battery of the Tor-M2 short-range surface-to-air missile systems, supplied to them by Russia. In December, the first Russian fighter jets arrived at a prospective Russian air force base in Baranavichy. Does this signal that the regional military balance is changing in favour of Minsk and Moscow? Nominally, Belarus possesses an impressive old Soviet armoury. Yet it acquired few modern arms after gaining its independence. In a rare admission to the situation with the nation's defence two years ago Belarusian leader Alyaksandr Lukashenka stated that the active lifetime of Belarusian military aircrafts was expiring. The military continues to fly old Soviet aircraft, but then decommissions them without finding any replacements.
On 5 December 2013, after a month of waiting, Aliaksandr Miazhujeu was appointed the State Secretary of the Security Council. Top police officials continue to work on improving the police's image among the population and fight against negative incidents from occurring within the agency. In the context of budget constraints, the main emphasis in this struggle is being made through ideological appeals and various organisational levers. Practical steps towards establishing a Russian air force base in Belarus have been made. However, this does not mean that the bargaining regarding this site is over.
This year, Russia agreed to supply Belarus with discounted oil only for the next six months, rather than for the whole year. The size and conditions for further shipments will depend on Belarus’ participation in specific integration projects and the sale of several companies to Russia. All of this shows how the Kremlin uses Belarus' energy dependence to get what it wants. Energy remains an area in which Russia has a very strong position in Belarus. Russia dominates the nation's gas infrastructure, oversees the work of its oil refineries and has significant influence on its electrical industry.
The Eurovision Song Contest became the number one event in terms of the frequency of its coverage on Belarusian state Channel 1. Belarusian state journalists also afforded viewers a lot of coverage on integration with the Customs Union and other Eurasian structures.
At the end of the year the Office of Statistics of Poland published information on the money spent in Poland by nationals from neighbouring countries. According to their report, from the period of July to September 2013 Belarusians spent $250m in Poland. Surprisingly, this figure per capita appeared larger than that of either Ukrainians or Russians. Due to the lower prices and better quality of goods, Belarusians from border regions, and even some from remote parts of Belarus, prefer to shop in Poland.
On 20 December, Deputy Prime Minister Piotr Prakapovich announced the need to accelerate the modernisation of Belarus. According to him, it was necessary to carry out not only its technical modernisation, but also its economic modernisation, including improving public administration system. But what Prakapovich's speech actually proved was that modernisation of Belarusian enterprises has failed. The state invested over $1bn in the cement and woodworking industries, but businesses are still generating only losses. At the same time some Belarusian companies cooperate with developed countries and update new technologies in their enterprises successfully. These examples serve as a good lesson for today's leaders of Belarus.