Lukashenka and the Eastern Partnership: time not ripe for a summit

After a lengthy pause, Belarusian President Alexander Lukashenka declined the invitation of the European Union to lead his country’s delegation at the Eastern Partnership (EaP) summit in Brussels. On 24 November, the day of the summit, he chose to visit a small provincial town in Belarus affirming that his foreign minister Vladimir Makei was perfectly capable to manage the job in Europe.

Why did the Belarusian leader deliberately miss the long-awaited opportunity to rub shoulders with Europe’s most powerful men and women? Few politicians and experts expected such a decision. Speculations abounded about Lukashenka’s motives. Was it the lack of Putin’s approval? Did Merkel refuse to meet the Belarusian peacemaker? Was he afraid of possible obstruction in Brussels?

The long-awaited invitation finally received…

On 9 October, an anonymous EU official told Radio Liberty, a US-funded news portal, that the European Union was ready to welcome Alexander Lukashenka to the forthcoming EaP summit in Brussels. The EU launched the Eastern Partnership in 2009 to promote economic integration and European values in Azerbaijan, Armenia, Belarus, Georgia, Moldova, and Ukraine.

For the first time in eight years, the EU placed no restrictions on the level of Belarus’s participation in the EaP’s main biennial event. Ahead of the previous summits, the EU made it clear through diplomatic channels that the Belarusian ruler was not welcome.

In fact, the European Union could not shun the Belarusian president any longer. Brussels lifted the bulk of its sanctions against Lukashenka’s regime almost two years ago. While avoiding any meaningful democratic reforms, Belarus has kept talking to the EU on many issues, including human rights. Minsk has been trying to curtail its repression against opposition and civil society: the last major slip happened eight months ago when the authorities arrested hundreds of peaceful protesters.

A decision to continue snubbing the Belarusian ruler could seriously undermine the positive dynamics of the relations between Belarus and Europe. Also, EU officials may have hoped that the never-really-experienced taste of top-level European diplomacy could motivate Lukashenka into injecting more substance in Belarus’s rapprochement with Europe.

… only to be politely refused

The following day after the EU invitation to Lukashenka leaked to mass media, Belarusian Foreign Minister Vladimir Makei announced that Minsk would take the decision of participation at the EaP summit “in due time,” after “analys[ing] all the circumstances.”

The lack of high-level contacts between Minsk and Brussels in the run-up to the summit signalled indirectly that the Foreign Ministry was not preparing Lukashenka’s trip there. On 15 November in Moscow, Makei effectively confirmed this assumption. Asked about the level of Belarus’s representation at the EaP summit, Makei replied that “it [would] be determined by the current level of [the country’s] interaction with the European Union”.

Vladimir Makei in Moscow. Photo: mfa.gov.by

In fact, despite the positive dynamics, Belarus-Europe contacts have generally failed to rise above the ministerial level. Moreover, in the two years since relations began to improve, Makei exchanged visits with only a handful of his EU counterparts.

His boss, Alexander Lukashenka, has remained a political outcast in Europe. The Belarusian leader’s only “visit to Italy” in May 2016 was a mere face-saving encounter with an Italian ceremonial president on the way to his meeting with the Pope.

The foreign ministry’s press service only officially confirmed that Lukashenka would stay home by 21 November—just three days before the summit was to be held—pointing out that “a high-level visit [was] usually the culmination of the sides’ mutual efforts to develop cooperation, which marks the achievement of profound systemic results.”

Why did Lukashenka decide to stay home?

The routine nature of most summits of the Commonwealth of Independent States or the Collective Security Treaty Organisation, where no “profound systemic results” have been achieved for years, never stopped Lukashenka from attending them. The Belarusian ruler also readily went to summits of such remote groupings as the Shanghai Cooperation Organisation, whose agenda never affected Belarus directly.

However, Lukashenka could hardly expect the same warm reception from officials and politicians in Brussels as he got used to enjoying among his post-Soviet or third-world counterparts.

Quite a few voices in the media and the expert community claim that Lukashenka decided to skip the summit because he did not want to irritate his Russian ally or, in even stronger terms, that Putin prohibited Lukashenka from going.

Indeed, the Kremlin views the Eastern Partnership as a Trojan horse designed to lure the former Soviet republics away from Russia. However, while Minsk has always taken these concerns into consideration, Lukashenka would never have missed the summit had it had a chance to produce tangible results in the development of Belarus-EU ties.

Lukashenka, with the help of domestic media, has already received all the public relations benefits he needs from the mere fact he is a persona grata in Europe again. German foreign minister Siegmar Gabriel—willingly or unwillingly—helped him with this, as he shared his “high hopes that the president himself [would] come because it would also be a good signal” during his visit to Minsk on 17 November.

Makei focuses on the economy and legal framework…

In Brussels, Vladimir Makei welcomed the shift of attention in the EaP to regional synergies in transport, energy and connectivity areas. He also called for trade facilitation between Belarus and the EU.

The foreign minister expects the successful completion of negotiations on the priorities of the partnership up to 2020. According to some sources, Lithuania prevented the adoption of this document during the Brussels summit demanding the inclusion of stronger language on issues relating to the Astraviec nuclear power plant. Belarus hopes to launch talks on a framework agreement with the EU next year.

However, in his statement, Makei failed to mention the visa facilitation agreement, which is the primary EU-related issue to most Belarusians. The negotiations on the agreement, which would make Schengen visas cheaper and easier to obtain, have stalled since 2015.

Vladimir Makei and Frederica Mogherini at a signing ceremony. Photo: mfa.gov.by

Meanwhile, the Belarusian foreign minister did not forget to promote Lukashenka’s favourite foreign policy ideas. These include the Helsinki-2 process, an initiative for Europeans to abandon their geopolitical rivalries with Belarus as the global discussion site, and the “integration of integrations” between the European Union and the Russian-led Eurasian Economic Union.

In Brussels, Vladimir Makei signed a High-level Understanding on a TEN-T (Trans-European Transport Networks) extension with Federica Mogherini, which will help to draw EU funds into large-scale transport projects in Belarus.

The Belarusian delegation made sure that Russia received no condemnation for its aggressive actions against some of the EaP countries. The summit’s final document mentioned Belarus in quite a positive way, stating appreciation of the fact that “the EU’s critical engagement with Belarus has become more comprehensive.”

…while the opposition highlights human rights agenda

However, the European People’s Party EaP Leaders Meeting, held in Brussels a day ahead of the EaP summit, adopted a declaration which spoke in much stronger terms about the need for the Belarusian authorities to drastically improve their human rights record.

Donald Tusk talks to leaders of Belarus’s centre-right coalition. Photo: EPP press service

The document also called for the participation of representatives in opposition parties from Belarus in the dialogue between the EU and Belarus. At the EPP pre-summit meeting, leaders from the centre-right coalition in Belarus, Anatoly Liabiedzka, Vital Rymasheuski and Yury Hubarevich had the ear of top EU officials as well as heads of state and governments from several EU and EaP partner countries to convey an alternative vision of Belarus’s relation with Europe.

The EaP summit demonstrated that there are now few to no realistic prospects for any substantial progress in Belarus—EU relations. The Lukashenka regime will avoid implementing any drastic structural reforms to the bitter end. All it can offer to Europe is its role of a “donor of stability” in the region and an endless and futile dialogue on any issue.

Europe, in its turn, has no energy, courage and means to replace or even move aside Russia in her role as Belarus’s main partner and donor. In this context, the relationship between Belarus and the EU can be easily managed for years by diplomats and mid-level officials, without Lukashenka’s public involvement.




Belarus and Moldova: cooperation despite opposing geopolitical orientations

On 6-7 May, Moldova’s Prime Minister Pavel Filip held a supercharged working visit to Belarus, meeting with the country’s top officials, kicking off several events, and discussing a wide range of issues, from trade to culture.

Despite serious recent setbacks in bilateral trade, Moldova remains an important economic partner for Belarus in the post-Soviet space. Unlike Russia, Belarus has no problem with Moldova's geopolitical orientation towards Europe, instead trying to use this factor to its advantage.

Will the recent election of the pro-Russian politician Igor Dodon to the Moldovan presidency affect the two countries’ economic cooperation?

Welcoming another advocate for Belarus in Europe

Pavel Filip received a warm welcome from President Alexander Lukashenka in Minsk. The Belarusian leader thanked ‘brotherly Moldova’ for explaining to ‘some zealous politicians in Europe what Belarus is and what our policy is’. Lukashenka promised to keep Belarus’s market open to products from Moldova, provided they adhere to high-quality standards.

Belarusian and Moldovan officials discussed trade and economic cooperation in detail during the 18th meeting of the joint intergovernmental commission. Filip also attended the BELAGRO agricultural trade show in Minsk. Twenty-two companies from Moldova promoted their wine, fruit, and vegetables at a 100-sq.m. stand dedicated to Moldova and sponsored by the Belarusian government.

The Moldovan Prime Minister also held a meeting with his Belarusian counterpart Andrei Kabiakou; they emphasised cooperation in the spheres of building and road construction, agriculture, and industrial assembly. The two officials also kicked off the Days of Moldovan Culture in Belarus.

Belarus does not object to Moldova’s European choice

Despite their relatively strong economic ties and shared history in the Soviet Union, there have been relatively few high-level contacts between the two countries’ executive authorities since their independence. Alexander Lukashenka visited Chisinau in August 1995 and received his Moldovan counterpart Petru Lucinschi in Minsk in June 2000.

Later, after two visits to Minsk by former Moldovan Prime Minister Vasile Tarlev in August 2001 and October 2005, there was a nine-year hiatus in high-level interaction, not counting irregular meetings on the sidelines of CIS summits. Finally, Lukashenka returned to Chisinau in September 2014 followed by Andrei Kabiakou in October 2016. Nicolae Timofti, the then Moldovan President, paid an official visit to Belarus in July 2015.

Interestingly, this reinvigoration of high-level contacts between Belarus and Moldova is happening against a backdrop of worsening relations between Chisinau and Moscow. In 2013-2014, Russia, unhappy with Moldova’s decision to enter into an association agreement with the European Union, introduced a ban on imports of Moldovan wine, fruit, and fruit and vegetable preserves.

In 2014 in Chisinau, Lukashenka reassured the Moldovan public that the signing and ratification of the association agreement would not affect the latter's relations with Belarus: ‘Don't dramatise… We need to create new forms and look for new ways of cooperating’.

Indeed, Belarus opened its market to Moldovan food products. Thus, in 2014, the imports of apples from Moldova to Belarus increased more than eleven-fold compared to 2013: from 5,600 to 63,900 tonnes. A large part of these Moldovan apples surely found their way to the forbidden Russian market. Total imports from Moldova to Belarus subsequently grew dramatically: from $91.8m to $149.6m.

‘During a gruelling time for us, Belarus has extended a helping hand in a very open, sincere, and friendly manner, for example, a few years ago, when we had some problems with some markets in CIS countries. We will not forget it’, Pavel Filip said about that period at his recent meeting with Lukashenka.

Will the golden age in trade return?

The golden age for trade between Belarus and Moldova lasted several years during the early 2010s and reached its peak in 2014. Last year, the turnover returned to its 2007 level. In 2016, Belarusian exports to Moldova reached their lowest point in the last decade.

The turnover continued to fall in the first quarter of 2017, contracting by 35% to the same period of the previous year. However, Belarusian officials are encouraged by increasing exports (up by 52%).

Belarus exports several dozen product groups to Moldova: petroleum and chemical products, tractors, motor vehicles, ceramic tiles, and glass fibre dominate exports. Imports are essentially limited to fruit and vegetables (fresh and preserved), wine, and spirits.

Petroleum products amounted to over half of Belarusian exports to Moldova in the peak years of 2013-2014. However, the abrupt drop in supply in 2015 upset bilateral trade. Nevertheless, it is fair to note that the sales decrease affected most product groups including tractors, the second-largest export group in trade with Moldova.

Currently, eighty-seven companies operate in Moldova with the participation of Belarusian capital, including flagship projects of knockdown assembly plants of Belarusian trolleybuses and tractors. Now, the Belarusian government is hoping to launch a knockdown assembly plant of Belarusian MAZ buses in Chisinau in late 2017.

Will Lukashenka’s fan in Moldova help to increase bilateral trade?

Igor Dodon, the recently elected Moldovan president who sympathises with Russia, has an affection for Lukashenka. He called the latter ‘an example for [Moldova] … in preserv[ing] all the best things from the USSR’. ‘The economy works like a clock, and there is a rigid vertical of power [in Belarus]’, Dodon said in an interview to Deutsche Welle.

Belarus supported Dodon’s application for observer status at the Eurasian Economic Union, which was approved by the member states in April 2017. The head of Moldova’s executive branch, Pavel Filip, seems to harbour no grudge against the Belarusian government for having supported this initiative, which he called ‘a symbolic gesture’ with no legal consequences.

Lukashenka and Dodon met in Bishek, Kyrgyzstan on 14 April, on the sidelines of the Eurasian Economic Council. According to Dodon, Lukashenka advised him to hold a referendum on introducing a presidential republic in Moldova to give the country's leader more power, according to the examples of Russia and Belarus.

Dodon also announced in April that he would soon come to Belarus on Lukashenka’s invitation. The visit is tentatively scheduled for 13-14 July.

Dodon’s activities as the new President of Moldova have apparently failed to affect Belarusian-Moldovan relations in any way, be it positive or negative. Dodon has little real power in the parliamentary republic, and Belarus prefers to work with those in charge.

Even if he succeeds in bringing Moldova back to the ‘Russian world’, it would hardly help to strengthen Belarus’s economic position in Moldova. Thus, despite its apparent fondness for rhetoric about integration and Soviet nostalgia, Belarus remains quite pragmatic in its economic dealings.




Belarusian diplomacy in 2016 – annual foreign policy digest

In 2016, Belarusian diplomats succeeded in getting rid of most Western sanctions, improving the international legitimacy of the national parliament, regularising dialogue with Europe, and converting Poland from a strong critic into a good partner.

Nevertheless, they failed to make Lukashenka fully presentable to his peers in Europe, alienated Ukraine’s political elite, botched export growth and diversification of the export market, and turned Lithuania from a supporter into a foe.

Belarus Digest offers its summary of Belarusian diplomacy’s achievements and failures over the past year.

A farewell to EU sanctions. In February, Belarusian diplomacy scored a major victory when the European Union ended travel bans and asset freezes against most individuals and all companies from Belarus.

Meanwhile, in the months preceding the final removal of sanctions, the Belarusian authorities failed to systematically improve the human rights, democracy, and the rule of law situation in the country.

Geopolitical considerations played the decisive role in the EU's decision, even if European officials denied it. In the regional security context, Europe decided against rebuking Belarus, which had previously acted as a fairly independent player.

Maintaining an ‘optimistic status quo’ with the US. Unlike Europe, the United States refrained from definitively removing sanctions against Belarus. However, Washington remunerated Minsk for its renunciation of overtly repressive policies by suspending economic sanctions repeatedly.

Belarus and the United States focused their dialogue on regional security issues. They also resumed military cooperation.

President Alexander Lukashenka chose to become personally engaged in these talks. He received several mid-level US envoys without giving diplomatic protocol too much mind.

Similar to Europe, the United States prioritised Belarus’s distancing from Russia’s assertive behaviour in the region over long-time concerns for human rights and democracy. However, the lack of progress in these areas precluded further improvement of bilateral ties.

Mainstreaming dialogue with Europe. In 2016, Belarus developed high-intensity relations with Europe, in both institutional and bilateral dimensions.

Hardly a month went by without high or mid-level EU emissaries coming to Minsk or Belarusian officials visiting Brussels. Belarus and the EU launched a new format for structured dialogue, the Coordination Group.

While high-level bilateral exchanges with many EU countries has become quasi-routine, Belarusian diplomacy remained most successful in strengthening bilateral contacts with Central and South-East European nations, leaving the 'old' Europe behind.

Lukashenka has remained a political outcast in Europe. His only ‘visit to Italy’ in May was a mere face-saving encounter with an Italian ceremonial official on the way to his meeting with the Pope.

Befriending Poland. Regional security considerations and genuine economic interests have encouraged Warsaw to pursue greater engagement with Minsk, putting aside ‘ideological superstitions’.

The two countries managed to re-establish multifaceted interagency contacts, which included long-taboo parliamentary cooperation. However, they stopped short of highest-level meetings. Poland also cut down its support for the opposition in Belarus and considered shutting down Belsat, the only independent Belarusian TV channel, which it supports financially.

It is not clear what Warsaw got in return, besides strengthened economic cooperation and hesitant signs that Belarus is turning away from Russia.

Meanwhile, several unresolved issues, mostly related to ethnic minority rights and trans-border contacts, have hampered a full normalisation of bilateral relations.

Fending off Lithuania’s diatribe. Although Belarusian-Polish relations improved, Belarusian-Lithuanian relations deteriorated. The two countries’ disagreement over the construction of the Belarusian NPP near their shared border caused a crisis.

Lithuania expressed fear about environmental and safety issues. Belarus saw economic and political motives behind Lithuania’s claims.

Vilnius attempted to form an international coalition to block potential exports of electric energy from Belarus. Minsk countered these efforts by pitching cheap energy to Lithuania’s neighbours and gradually increasing transparency around the nuclear project. Bilateral trade and investment cooperation suffered as a result.

Legitimising the puppet parliament. Over the last twenty years, the international contacts of Belarusian MPs has remained largely limited to their Russian counterparts, the CIS, and developing countries. European legislators have overwhelmingly boycotted the rubber-stamp institution, which the executive branch appoints and controls.

In 2016, several Western parliaments apparently took the removal of sanctions as an encouragement to reengage with Belarus in all areas, including inter-parliamentary relations.

Exchanges of parliamentary delegations between Belarus and Europe have become commonplace. The visits of high-level MPs from Poland and Austria were especially instrumental in helping the marginalised Belarusian legislature to gain international recognition.

No convincing attempt to provide an explanation for the sudden need to ‘normalise’ the entity, which has no say in Belarus’s domestic or foreign policy, has been made so far.

Withstanding Russian pressure. In 2016, relations between Belarus and Russia reached their lowest point in years.

The two countries squabbled over a number of unresolved issues in different spheres: oil and gas supplies, market access, exports of Belarusian agricultural and food products to Russia, loans, transit of third-country nationals through the Belarusian-Russian shared border, and more.

Both countries avoided verbalising the intensity of disagreements at the political level. Instead, they took recourse to various ‘soft power’ measures. These included airing propaganda talk shows on Russian TV with speculation about pro-Maidan trends in Belarus; arrests of pro-Russian journalists in Belarus; fomenting fears of a Russian invasion of Belarus; and Lukashenka’s refusal to attend a Eurasian summit in Russia.

Belarus remained dissatisfied with Russia’s reluctance to provide its usual level of economic sponsorship. Russia was unhappy about Belarus’s decreased level of loyalty in foreign policy and security matters.

Disappointing the Ukrainian elite. In 2016, Belarus managed to increase its bilateral trade with Ukraine; this stands in stark contrast to its deteriorating commercial relations with most other countries. The two countries also succeeded in putting an end to a tariff war between them.

However, despite Belarus’s tacit refusal to support Russia in its hybrid war against Ukraine, political relations between Minsk and Kyiv deteriorated.

Alexander Lukashenka and Petro Poroshenko have not met in a bilateral format since mid-2014. Their agreement to meet in late 2016 failed to materialise after Belarus voted against a UN resolution on human rights in occupied Crimea. This vote angered many among Ukraine’s elite.

Failing to achieve a breakthrough with ‘Distant Arc’ countries. Belarus sought to achieve a more balanced geographical distribution of its exports to decrease the national economy's vulnerability to stress situations in its main markets.

Lukashenka travelled extensively outside Europe and Russia – visiting China, Pakistan, Qatar, Turkey, and the UAE. His diplomats also focused mostly on Middle-Eastern and Asian nations.

However, efforts to increase the share of ‘Distant Arc’ countries in Belarus’s trade have largely failed. In January-November 2016, exports to these markets decrease by 12.5%, from $7.13b to $6.24b, and the share in total exports remained at 29%.

Belarus took pride in improving its relations with China from a simple ‘strategic partnership’ to a ‘comprehensive strategic partnership featuring mutual trust and win-win cooperation’.

Belarus's excellent political relations with China may serve to counterbalance Russia’s outsized influence on Belarus. However, these relations have failed to provide an immediate economic payoff as Belarusian exports to China in 2016 contracted to their lowest level since 2009.

Faltering at the United Nations. In 2016, Belarusian diplomacy invested much effort in reforming the process of appointment for new UN Secretary Generals. Throughout UN history, its leader has been chosen based on consensus of the Security Council’s permanent members.

Despite some external signs of greater transparency and inclusiveness, Belarus’s reform efforts have largely failed. Even Belarus’s closest ally, Russia, refused to support this initiative.

Minsk stuck to its non-consensual initiative in promoting the traditional family. It also created a group of like-minded middle-income countries, exploring a new way to access UN development assistance.

Belarus’s policy statements at the UN contrasted with its recent pragmatic approach to bilateral and multilateral diplomacy. Using strong anti-Western and anti-capitalist rhetoric, they assigned blame for Belarus’s economic, social, and security failures to West-induced ‘global chaos’.

In 2017, Belarusian diplomats will continue to work wonders: developing relations with the West without a hint of meaningful democratic reforms at home; keeping Russia as its closest ally and sponsor without offering the usual degree of loyalty in return; and increasing exports and attracting investments without economic restructuring and reforms.




Investing in Belarus: a story of Lithuanian businessmen

While the governments of Belarus and Lithuania continue to clash over the construction of the Astraviec nuclear power plant, Lithuanian investors in Belarus are continuing to operate normally. Lithuanian businessmen became the largest Western investors in Belarus, adding more than €80 mln to the Belarusian economy in 2015.

Investments remain at a high level, although several Lithuanian companies have abandoned their projects because of the Belarusian economic crisis. Moreover, the poor political reputation of the Belarusian authorities still discourages Western businessmen from investing.

Meet Lithuania, the biggest Western investor in Belarus

It seems that Belarus has never enjoyed a good reputation among foreign investors. While officials continue to harp on the need to attract foreign investments, investment figures remain low, falling slightly since 2013. If in 2013 Belarus received $2.1 bn in foreign direct investments, over the first six months of 2016 Belarus raised only $950 mln, according to the Belarusian Ministry of Economy.

In December 2016, Kiryl Rudy, Ambassador of Belarus to China, published an article arguing that foreign investors are fleeing from Belarus and the government needs to change its attitude towards investors. Rudy previously served as the president’s economic advisor and remains one of few openly pro-reform officials of Lukashenka’s regime.

According to official data, more than 60% of investments came to Belarus from Russia and Cyprus, where many Russian and Belarusian businessmen have registered companies. Thus, excluding Russia and Cyprus, Lithuania is the main foreign investor in Belarus, investing more than Dutch, Estonian, and Austrian companies combined.

According to Rudy, in 2011-2015 the five largest investors (such as the Austrian Kronospan or the Dutch Heineken) accounted for more than 40% of total investments. This underlines Lithuania's role: specific investments are not necessarily large, but they are numerous, pointing to a long-term rather than situational interest. Belarus and Lithuania have already held 12 bilateral economic forums.

Mapping Lithuanian investments in Belarus

For Lithuanian businessmen, Belarus is not the worst option for investment, as they understand Belarusian culture and mentality. As a former Lithuanian Ambassador to Belarus Evaldas Ignatavičius stated in 2016, 'free niches in the Belarusian economy attract Lithuanian business'. Moreover, the Lithuanian domestic market has a rather limited population (3 mln) only half again as large as Minsk’s (2 mln). Notably, Minsk is the nearest city to Vilnius with a population of more that one million people.

Moreover, as the Lithuanian political scientist Vytis Jurkonis noted to Belarus Digest, 'due to to EU technical regulations, it is much more convenient to open a factory in Belarus that in Lithuania, not to mention the cheaper labour force there. The geographical proximity and historical ties also play an important role'.

In 2013, another Lithuanian political scientist (and now MP), Laurynas Kasčiūnas, said that 'Every second rich Lithuanian has business in Belarus.' This appears to be the truth: in Belarus, there are 500 companies with Lithuanian capital. The largest investments are concentrated in several areas.

Retail. Lithuanian companies own OMA, a chain of construction materials stores, which employs around three thousand people, as well as the food chain Mart Inn, known for frequently using the Belarusian language in its shops.

Woodworking. The Lithuanian companies SBA and Vakaru Medienos Grupe produce furniture in Belarus, including for Ikea. Vakaru Medienos Grupe currently works in three Belarusian towns: Mahiliou, Barysau and Lahojsk, while SBA operates only in Mahiliou.

Food products. Two daughter companies of Arvi ir Ko are engaged in raising turkeys; they also own a factory processing livestock waste in Hrodna region. Meanwhile, owner of KG Group Tautvydas Barštys produces feed additives. In 2015 the company sold its products for about $15 mln, according to its website.

Energy. Modus Grupe, in addition to selling motor vehicles and establishing car parks, develops alternative energy sources in Belarus. In 2016 it launched one of the largest solar power plants in Eastern Europe. However, according to information given to Belarus Digest, the two countries are currently rethinking their cooperation in energy because of the Astraviec conflict, and may end all projects in this area.

Despite the activity of Lithuanian business, not all investment projects have become a reality. Last year the company Oil Pack Invest turned down the idea of building a waste recycling plant in Babrujsk, and the company Vicunai decided against establishing a fish processing plant near Minsk.

Obstacles to Lithuanian investments

It comes as no surprise that many are reluctant to invest in a country facing its third year of a recession. However, some businesses fear not only the economic crisis, but also pressure from the authorities.

In April 2016, the head of the Lithuanian confederation of employers Danas Arlauskas told Delfi News Agency that 'Belarus remains a peculiar market – without the approval and support from the authorities one can lose a lot there.' Foreign investors have to somehow communicate with authorities of a country that occupies 107th place in the Corruption Perceptions Index of Transparency International. According to Vytis Jurkonis, 'unpredictable decisions by official Minsk, when some businessmen (or their lawyers) end up in jail without due process or the investment is simply "lost" remains a significant obstacle'.

Moreover, Lithuanian businessmen may be afraid of becoming political pawns. According to information published by the Polish Centre for Eastern Studies (OSW), in 2012 the Belarusian Presidential Administration summoned foreign investors to explain that they must speak out against sanctions against Belarus, otherwise the Belarusian authorities would complicate their activities within the country.

Although Belarusian-European relations have improved, Belarusian-Lithuanian relations have conversely deteriorated. The governments of the two countries clash over the nuclear power plant being built in Belarus, and bilateral economic forums lack the previous blessing of the Belarusian and Lithuanian authorities.

While in 2013 and 2014 the prime ministers of both countries attended the Belarusian-Lithuanian economic forums, in 2015 and 2016 the level of representation of government officials decreased. The Belarusian delegation in 2016 was headed by the Deputy Minister of Economy. This may have changed not only because of the clash over Astraviec, but also due to personal changes in the Lithuanian Confederation of Industrialists, the organiser of the forum, which lost some people connected with its previous president Bronislovas Lubys, who wielded significant political influence.

As a result, Lithuanian businessmen have lost the leverage brought by the good relationship between the governments of Belarus and Lithuania. Currently, they are using international financial institutions as an instrument to make their investments more safe. For example, Modus Group cooperates with the European Bank for Reconstruction and Development, which provided a loan for the construction of the solar power plant. Thus, if Belarusian authorities put pressure on the Modus Group, it could also strain their relations with the EBRD.

All this shows that there is a lack of trust between Lithuanian businessmen and the Belarusian authorities. Nevertheless, 'external factors and rhetoric, or even the so called restrictive measures, very rarely play a role', according to Vytis Jurkonis, 'businessmen are (and will continue) to do business, despite the political climate.' Even with its problems, Belarus remains a good place for Lithuanian businessmen.




Is the isolation spell broken? – Belarus foreign policy digest

In November, the Belarusian president held meetings with leaders of Azerbaijan, Russia, Slovakia, Turkey, and a high-level EU delegation.

The Slovakian Prime Minister's visit to Minsk ended a six-year long hiatus in bilateral visits of European leaders to Minsk. Alexander Lukashenka now seems to be more comfortable meeting with European emissaries than with Vladimir Putin.

Negotiations with leaders from ‘Distant Arc’ countries focused on trade and investment but also had geopolitical significance. Belarus is seeking to avoid being caught in a tug of war between Europe and Russia.

Lukashenka meets with authoritarian colleagues

On 11 November, Turkish President Recep Tayyip Erdoğan paid an official visit to Minsk to hold talks with President Lukashenka. The two leaders signed several bilateral documents, opened the first cathedral mosque in Minsk, and chaired a business forum attended by nearly two hundred Turkish business executives.

Erdoğan was expected in Minsk on 29 July. However, he had to postpone his visit after the fail coup attempt in Turkey. The two countries had been preparing for the meeting even amidst the crisis in relations between Turkey and Russia, Belarus’s closest ally.

Lukashenka and Erdoğan discussed trade and investment relations focusing on cooperation in manufacturing advanced technology products.

Both presidents are aiming for a $1bn turnover. However, this figure would be hard to achieve. The current growth trend may be explained by Turkey’s recent attempts to circumvent Russian sanctions – but this may not be permanent.

Belarus has provided Erdoğan with a convenient example of a European ‘illiberal democracy’. Both leaders share a preference for strong presidential power and use of the death penalty. This may facilitate cooperation between the two authoritarian leaders.

On 28-29 November, Lukashenka visited Azerbaijan to meet with his counterpart Ilham Aliyev and the country’s Prime Minister Artur Rasizade. The two countries stick to a regular schedule of high-level meetings focusing on trade and investment.

Despite close contacts, bilateral trade has remained low in recent years, dropping by two thirds in 2015. Lukashenka has traditionally pitched Belarusian tractors and trucks as well as military equipment.

This year, for the first time, the countries agreed to cooperate in the energy sector. Belarus recently bought 84.7 thousand tonnes of oil from Azerbaijan, likely as a political gesture to show that Belarus is exploring alternative sources of oil supply. Speaking to journalists, Ilham Aliyev sounded uncertain as to the long-term nature and sustainability of these operations.

Slovakia breaks Lukashenka’s isolation spell

On 25 November, Slovakia’s Prime Minister Robert Fico paid an official visit to Belarus. The last EU leader to visit Belarus with a bilateral agenda was Lithuania’s President Dalia Grybauskaitė in October 2010.

In Minsk, the Slovakian official held talks with his Belarusian counterpart Andrei Kobyakov and met with Alexander Lukashenka. Fico and Kobyakov signed a joined communiqué emphasising cooperation in tyre manufacturing, energy, and the automotive, food, and pharmaceutical industries.

Despite the fact that Slovakia currently holds the EU presidency, the country’s prime minister can hardly be seen as representing an agreed-upon European position towards Minsk. Fico has been known to take a divergent position on Russia in the EU, based on the concept of ‘Slavonic solidarity’.

In Minsk, Fico called Belarus ‘a friendly country’ and reckoned that the situation there has improved. He also expressed satisfaction with the abolition of sanctions against Belarus, calling them harmful and meaningless.

Upon returning to Bratislava, Fico had to defend his visit to Belarus and his encounter with Lukashenka on a local television programme. He compared his trip to Minsk to the meeting of German and French leaders in the Normandy format in Belarus in February 2015.

EU officials: “We are not naïve or blind”

A few days earlier, on 21 November, Alexander Lukashenka received a delegation of the Political and Security Committee of the EU Council. The policy-setting officials held meetings with Belarus’s foreign minister Vladimir Makei and opposition activists.

The Belarusian president emphasised Belarus’s role as a ‘pole of stability’ in the region. In return, he sought Europe’s support in strengthening the economic independence of his country.

At a meeting with opposition leaders, The EU delegates asserted that they were ‘not naïve nor blind’ as to problems with democracy in Belarus.

A participant of the meeting told Belarus Digest that the delegation’s attitude towards the opposition had been ‘quite sympathetic’, and that they had displayed a certain level of mistrust towards the authorities. The activist also stressed that this ambiance contrasted somewhat with the dominant mood during similar meetings with Polish diplomats recently.

Belarus tries to withstand Russian pressure

On the day after his meeting with EU officials, Lukashenka had a five-hour long meeting with his Russian counterpart in Moscow. Meanwhile, Vladimir Putin was quick to highlight that this was only a sideline event to the celebrations of the 70th birthday of Patriarch Kirill.

Before the summit, Russia had signalled via Alexander Surikov, its ambassador to Minsk, that the resolution of economic disputes between the two countries would depend on the results of discussions of political issues. Moscow has been blackmailing Minsk into downshifting the pace of its relations with the West while stepping up military cooperation with Russia.

Deadly silence on the outcome of the meeting has provided a clear indication of its failure. No progress was reported on the outstanding issues of gas price and oil supply in the two weeks that followed Lukashenka’s visit.

Instead, Moscow has attacked Minsk with its powerful propaganda machine, using its TV channels, media personalities and even the Russian Orthodox Church. They have denounced anti-Russian and pro-Maidan sentiments in Belarus and lauded past Russian imperial figures who played a tragic role in Belarus's history.

Russia has also intensified its efforts to force Belarus into agreeing on a single visa policy. Moscow’s weapon of choice has been the newly introduced prohibition on travel of third-country nations across the Belarus-Russia border. This measure has negatively impacted Belarus’s status as a transit country.

Lukashenka’s recent diplomatic activities have aimed at finding new sources of exports revenue, investments, and loans which would compensate the exhausted flow from Russia. These efforts are unlikely to have an immediate pay off. Meanwhile, Russia is stepping up its pressure to bring Belarus back into its orbit.




Towards a new agenda for the West and Belarus

The results of the parliamentary elections on 11 September surprised many in Belarus. Few believed that Lukashenka’s regime would allow independent deputies in parliament, but these elections have shown that the Belarusian authorities are at least willing to appear to change.

Although this does provide optimism, Belarus and the West still need to create a new agenda to ensure that Belarus remains on a positive trajectory. In other words, the EU and US should not make demands that are completely unacceptable to the regime.

The West's main requirement, free elections, is not an unreasonable one. However, increasing democratic space within the country should be a greater priority. This could be accomplished , for example, by moving Western foundations to Belarus and pushing for a greater number of opposition politicians in local councils.

Parliamentary surprise

The idea that Lukashenka’s regime cannot change has existed for a long time, but the parliamentary elections on September 11 have showed a slightly different side to the Belarusian authorities. The author, an observer at the elections, personally witnessed the election commissions inflating turnout, while the process of vote counting remained opaque. In the end however, the Belarusian authorities surprised many by letting Hanna Kanapatskaja and Alena Anisim, two women with democratic views, into the parliament.

This shows that Lukashenka's regime appears able to at least implement token reforms to appease the West. A year ago, the Belarusian government released a number of political prisoners to this end and now seeks to similarly utilise the democratic MPs. This is a huge step, despite the circumstances.

The Belarusian authorities have in fact made concessions before, such as during dialogues of 2008-2010. At this time the regime returned certain independent newspapers to the public distribution system, such as Nasha Niva and Narodnaya Volya, and registered the Movement for Freedom, an opposition group led by Alexander Milinkevich.

But today's concessions are of a different nature. Two people with democratic views received official status and a salary of $800 a month and influence, which has not happened in Belarus for 12 years. This legitimises democratic politicians even for those who are not sympathetic to the Belarusian opposition.

The need for a positive trajectory

Pro-regime experts often argue that Belarus is not yet ready for democracy, but the authorities are wisely taking baby steps in this direction. This is not the case. In fact, Lukashenka's regime would like to avoid democracy, as it would threaten many figures of authority or wealth: certain Belarusian officials have made their fortunes thanks to the authoritarian nature of Belarus. One example is Mikhail Miasnikovich, the head of the Upper Chamber of the Belarusian Parliament, whose watch reportedly cost $30,000.

Nevertheless, as the parliamentary elections show, the Belarusian government is capable of some concessions. Changes have become possible largely due to the desire of Belarus and the West to continue normalising relations. As Lukashenka told Scott Rauland, then charge d'affaires a.i. of the U.S. on July 6, Belarus will not have a full-fledged foreign policy without first normalising its relations with Washington. Today, Belarus needs the EU and the US for a variety of reasons – from economic support to a desire to distance itself from Russia.

However, the Belarusian regime remains reluctant to cede power by holding free elections and the West needs to understand this. If the EU and the US require only free elections, it will not encourage the regime to make any concessions. On the other hand, it is vital that the West not give up its ideals, otherwise Lukashenka will lack incentive to reform.

Both sides now need a positive trajectory, in which Western requirements do not exceed Lukashenka's ability to change. It is no surprise that the regime will require carrots, and the West should continue to provide them conditionally. For example, now that the Belarusian parliament has two oppositions members, the level of cooperation with the Belarusian parliament ought to be increased.

What should be done

The story of Anna Kanapatskaja and Alena Anisim shows what the West should focus on: gradual institutionalisation of democratic groups and civil society in Belarus.

The European Union and the Unites States may require Belarus to clear the Augean stables. Some people, like Eduard Palchys, still remain in prison, while accusations against him appear at least partly politically-motivated. Belarus also retains article 193.1 in criminal law, under which a member of an unregistered organisation can receive two years in prison.

The West must take a stand in these matters, but this should not be the focus of its energy, as these issues do not have long-term value. Lukashenka's regime can repeal the law, but nevertheless send people to prison under a different article in the event of a change in the political climate. For example, Ales Bialiatski, leader of the unregistered human rights organisation "Viasna", was sentence for allegedly avoiding taxes in 2011.

More important is to contribute to longer-term changes – to increase Western presence and to help civil society and democratic groups to do the same.

For example, the Belarusian authorities could allow Western political and civil foundations to open their representative offices in Belarus. Their activities may be monitored, but the presence of organisations such as the American National Democratic Institute or the Swedish Forum Syd will be more effective if they are conducted in Belarus. The funds will be able to reach a greater range of Belarusians and support more grassroots initiatives; they remain invisible while working from Vilnius and Warsaw.

Moreover, a physical presence in Minsk will bring the West and democracy greater legitimacy in the Belarusian public space. Belarusian officials, experts or politicians can build long term relationships with the West and stop seeing the European Union or the United States as enemies.

Thus, the West may require more opportunities for democratic groups from the authorities in the local elections in 2018. Representatives of the opposition do not yet have access to all local councils. Moreover, the value of such councils in the Belarusian system seems marginal. Therefore, the election of several dozen opposition politicians will not threaten Lukashenka’s regime, although it will strengthen the germs of Belarusian democracy.

Vitali Silitski, the most well-known Belarusian political analyst, who died in 2011, often emphasised that change needs to come from inside the country, not outside. It seems that today a window of opportunity for active change has appeared.




Central and Eastern European dimension of Belarusian diplomacy – Belarus foreign policy digest

In July and August, Belarusian diplomats kept busy reinforcing ties with the country’s partners in Central and Eastern Europe. These relationships may prove to be instrumental in bolstering Belarus's foreign policy positions.

Foreign minister Vladimir Makei travelled to Kyiv in the midst of another flare-up in the conflict between Russia and Ukraine. His deputy Alena Kupchyna's trips to Austria, Poland, Turkey and Ukraine served to strengthen informal channels of communication alongside formal contacts.

At home, Belarus has started preparing intensively for its 2017 presidency of the Central European Initiative, hoping to reap important economic and PR benefits from this temporary office.

Showing off a “mature partnership” with Ukraine

Vladimir Makei visited Ukraine on 25-26 August for the inauguration of the new residential compound of Belarus’s embassy in Kyiv.

The foreign minister paid a visit to the country’s President Petro Poroshenko and discussed a wide range of issues with his counterpart Pavlo Klimkin and deputy prime minister in charge of construction Hennadiy Zubko.

Makei visited Kyiv just as Minsk’s closest ally, Russia, was accusing Ukraine of terrorism and had once again started referring to Ukraine’s leaders as “those who seized power in Kyiv”. Lukashenka’s emissary emphasised Belarus’s determination “to be guided only by its own national interests” when developing its relations with Ukraine.

Belarus and Ukraine are happy about the absence of “any unresolved issues” in their bilateral relations. Makei dismissed recurring trade wars as “periodically emerging minor questions” of “mostly technical nature”, which the countries intend to address at the next meeting of the intergovernmental committee.

Makei and Poroshenko discussed the prospects for further normalisation of relations between Belarus, the EU, and the United States with Ukraine’s assistance. In July, meanwhile, Belarus’s foreign ministry had politely declined a similar offer from Poland’s foreign minister. Witold Waszczykowski then suggested that Warsaw could act as a mediator in fostering closer cooperation between Belarus and NATO.

Emphasising informal dialogue with Europe

Belarusian and Polish diplomats may have discussed Waszczykowski’s mediation proposal within the framework of political consultations held in Warsaw on 20 July. The delegations were headed by deputy foreign ministers Alena Kupchyna and Marek Ziółkowski respectively.

Minister Waszczykowski, who received Kupchyna in Warsaw, rejoiced at the increasing dialogue between various ministries in each country, but mentioned political and parliamentary contacts specifically.

Indeed, two weeks later, Ryszard Terlecki, vice-speaker of the Polish Sejm, led the highest-level parliamentary delegation of an EU country to Minsk in twenty years. The accommodating Polish government seems to be willing to negotiate, advocating the improvement of the situation of the Polish minority in Belarus in exchange for recognition of the impotent Belarusian parliament.

However, summer seemed to be more conducive to informal contacts between Belarus and Europe.

Alena Kupchyna went to Kyiv on 11-12 July to attend the 7th Eastern Partnership (EaP) Informal Partnership Dialogue. The EaP countries’ senior diplomats discussed the further development of the Eastern Partnership and international issues. Their colleagues from the ministries of economy focused on economic reforms to unleash the potential of small and medium-sized enterprises.

Kupchyna seized the opportunity to campaign for an enhanced dialogue between the Eurasian Economic Union (EAEU) and the European Union. Belarusian diplomats are persisting in advocating the “integration of integrations” despite the fact that even sympathisers of this concept in the EU see it as a mere Russian project.

On 27-30 August, Alena Kupchyna travelled to Alpbach (Austria). She participated in a panel discussion on Central and Eastern Europe and Russia in the framework of the European Forum.

In Alpbach, Kupchyna met in an informal setting with foreign ministers of Slovakia and Ukraine. The soon-to-be Belarusian ambassador in Vienna also held meetings with the Austrian foreign minister and some members of his staff.

Strengthening strong ties with Turkey

Alena Kupchyna visited Turkey on 15 July, only one day before the failed coup attempt. In Ankara, she held political consultations with Deputy Undersecretary Ali Kemal Aydın. Belarus and Turkey agreed on an action plan to develop cooperation between the two countries for 2016-2017.

The trip's main purpose was to prepare for President Recep Tayyip Erdogan’s visit to Minsk, which was initially scheduled for 29 July. The attempted coup forced the parties to postpone the visit.

The recent crisis in relations between Russia and Turkey caused by the downing of Su-24 jet fighter never affected the dynamics of cooperation between Minsk and Ankara. Belarus expressed immediate and unconditional solidarity with Erdogan after the coup attempt. Belarusian President Alexander Lukashenka sent a personal message of support to his Turkish counterpart.

Lukashenka's ideology boss, Vsevolod Yanchevskiy, visited Ankara on 11 August to discuss major investment projects, which would require the blessing of the two presidents. Minsk expects Erdogan sometime in September. The exact date has yet to be officially announced.

Preparing to assume the CEI presidency

As Belarus Digest had forecast earlier, Belarusian diplomacy intends to make the most of the country’s presidency in the Central European Initiative (CEI) in 2017.

In Bosnia and Heregovina in June, Vladimir Makei promised to “place a special emphasis on fostering connectivity in the region, supporting sustainable economic development, and further promoting the CEI’s outreach”. By the latter, the foreign minister had in mind a closer relationship between the CEI and Russia-dominated groupings, such as the CIS and the EAEU.

On 15 July, Makei began proper preparations for a series of CEI events to be held in 2017 in Minsk, one of the priority topics for his annual meeting with Belarusian ambassadors.

More importantly, on 25 July, the Belarusian government established an inter-agency working group to ensure Belarus’s presidency of the CEI. The group was chaired by Prime Minister Andrei Kobyakov, and included high-level representatives of twenty-three ministries, governmental agencies and other public bodies.

Having good qualifications for multilateral diplomacy, Belarus’s foreign ministry will seize every opportunity the presidency provides to push through its agenda with countries of Central and Eastern Europe. This region already represents the Belarusian authorities’ largest support base in Europe.

Besides practical benefits derived from development of economic ties, the Belarusian government will try to use this opportunity to improve its public relations.

Belarus’s growing engagement with Central and Eastern European countries may pursue two objectives simultaneously. Firstly, to position itself as an important regional player. Secondly, to obtain more and stronger allies or at least sympathisers among EU members and EU-leaning countries to strengthen its negotiating position with regards to the European Union.




Progress on the Western front – Belarus Foreign Policy Digest

Working-level contacts between Belarus and the European Union are thriving. However, this has been the case for a few years now. Brussels apparently expects much more from Minsk in order to proceed to the highest-level of dialogue with Belarus.

In the eight months since the initial suspension and subsequent removal of EU sanctions, no European head of state has visited Belarus. Alexander Lukashenka’s only trip was to Italy, but its purpose remains obscure. Only a handful of visits from foreign ministers have taken place so far.

Level of dialogue between Europe and Belarus remains modest

In June, Belarus welcomed another foreign minister from an EU country after an eighty-day hiatus. On 29-30 June, Lubomir Zaorálek, the Czech foreign minister, held talks with his Belarusian counterpart Vladimir Makei. He also met the chairwoman of the Belarusian Central Election Commission, Lidzija Jarmoshyna, as well as representatives of the democratic opposition.

Zaorálek spoke about the opening of a new chapter in Belarusian – Czech relations both at his meeting with President Alexander Lukashenka and during the inauguration ceremony for the new Czech embassy building in Minsk.

The minister was accompanied by a group of Czech business executives. According to Makei, Belarus and the Czech Republic are assessing opportunities to implement investment projects in Belarus amounting to $500m. Zaorálek mentioned the interest of Metrostav, a Czech construction giant, in taking part in the expansion of the Minsk metro system.

Dialogue with Europe dominated the Belarusian foreign ministry’s activities in June. Deputy foreign minister Alena Kupchyna paid working visits to Hungary, Slovenia and Finland and co-chaired a meeting in Minsk of the commission of economic cooperation with Bulgaria .

On 6-7 July, Vladimir Makei travelled to Latvia on a working visit. In Riga, he met his counterpart Edgars Rinkēvičs and was received by the country's president and prime minister. Trade, investment and transit infrastructure projects, as well as regional security concerns, dominated their discussions.

Edgars Rinkēvičs supported Belarus' aspiration to develop a basic agreement with the European Union. So far, EU countries remain divided on the issue.

Human rights dialogue put on hold

Kupchyna also led the Belarusian inter-agency delegation at another round of the human rights dialogue with the EU. On 7 June in Minsk, the parties focused on the freedoms of expression, assembly and association; electoral rights; the death penalty and the fight against torture and ill treatment; the rights of people with disabilities and the fight against domestic violence.

Civil society involvement in the discussion of political rights remains impossible

Belarus allowed civil society activists to participate in the debate on the two latter issues. This is consistent with Minsk’s policy of emphasising social and economic rights while downplaying the importance of civil and political freedom. Civil society involvement in the discussion of political rights remains impossible.

On 11 September, Belarus will hold parliamentary elections. Despite the fact that electoral rights remain one of the biggest sore spots in the human rights situation in Belarus, the next round of dialogue will take place only in 2017.

CEI: a great PR opportunity for Belarus

On 16 June, Vladimir Makei travelled to Banja Luka in Bosnia and Herzegovina to attend the annual meeting of the foreign ministers of the Central European Initiative (CEI).

A year ago, Belarus snubbed a similar meeting of this regional organisation in Macedonia by sending the Belarusian ambassador in Belgrade to represent the foreign minister.

However, Vladimir Makei could not afford to miss the ministerial event this year as the CEI’s rotating presidency for 2017 was awarded to Belarus. This decision means that Minsk will host a meeting of foreign ministers of 18 member states of the CEI in June next year and a meeting of these countries’ prime ministers at some time in autumn. There is no doubt that official propaganda will exploit these events to the fullest.

As the Initiative’s president, Belarus will be better positioned to influence the organisation’s agenda. In his statement in Banja Luka, Makei vouched for more attention to economic development and strengthening cooperation between regional organisations and integration projects in Europe and Eurasia.

Belarus’ independence remains the pillar of its relations with the US

On 6 July, Alexander Lukashenka received Scott M. Rauland, chargé d’affaires a.i. of the United States in Belarus. Rauland has completed his two-year mission in Minsk and will return to his home country on 8 July.

It is customary for the head of state to accept farewell visits of foreign ambassadors. However, chargés d’affaires a.i., due to their place in the diplomatic hierarchy, cannot expect the same privilege. Lukashenka’s meeting with Rauland demonstrate the importance the Belarusian leader attaches to relations with the United States.

Some recent measures taken by the US government against Belarus failed to affect Lukashenka’s decision to receive the American diplomat.

Most importantly, on 10 June, Barack Obama decided to extend the sanctions against Belarus by one year. Sanctions were introduced by President George Bush in his Executive Order 13405 on 16 June 2006 against a number of Belarusian officials including Lukashenka himself.

On 22 June, the US government introduced sanctions against Belvneshpromservice, a major Belarusian arms exporter, under the Iran, North Korea, and Syria Non-proliferation Act sanctions.

Finally, on 30 June, the US State Department released the 2016 edition of the Trafficking in Persons report. This report placed Belarus, which considers itself an international champion in fighting human trafficking, among the worst offenders, one of the “countries whose governments do not fully meet the minimum standards and are not making significant efforts to do so”.

The Belarusian foreign ministry’s spokesperson labelled the report an “opus … a far cry from objectivity”. She said that cooperation between Belarus and the US in this domain was still in the interests of the international community, even if the countries continue to disagree on methodology and priorities.

John Kerry: My government fully backs Belarus’ sovereignty and territorial integrity

On a positive note, on 3 July, Secretary John Kerry released a statement congratulating the people of Belarus on the anniversary of Belarus’ declaration of independence from the Soviet Union and on the officially observed Independence Day.

Kerry reiterate the United States’ appreciation of “Belarus’ leadership in supporting a peaceful resolution to the crisis in Ukraine”. The top US diplomat reassured Belarusians that the American “government fully back[ed] Belarus’ sovereignty and territorial integrity”.

Rauland also brought up this subject at his meeting with Lukashenka. The American diplomat communicated that Washington “[is] ready to cooperate with Belarus for the sake of a good future. Most important is that the territorial sovereignty and independence of Belarus remained at the highest and strongest level”.

Lukashenka reassured Rauland that Belarus would never agree to become an unsovereign, dependent state. The Belarusian leader noted noticeable progress in bilateral relations and expressed a strong desire for “normalisation of relations with the US on mutually beneficial terms”.

The recent developments in Belarus’ relations with the West have demonstrated that the country’s distancing from Russia’s assertive behaviour in the region may be sufficient for maintaining good working contacts with the democratic world and preventing a backslide into the logic of confrontation.

However, the West expects much more progress within Belarus on human rights, democratic development and economic reform to make grounds for a significant upgrade of bilateral ties. The Belarusian authorities seem reluctant to adopt this path, still hoping for softer terms.




Belarus-EU Relations: Reaching the Limit?

Recently Belarus was considered a relative success story of the Eastern Partnership – no territorial disputes, no broken promises, only gradual positive dynamic in relations with the European Union (EU).

However, the intensity of Belarus-EU cooperation seems to have reached its limits. The lack of further progress in the human rights arena and dubious plans of Belarusians officials on electoral reform harm the relations.

Announcing the Foreign Ministers' meeting on 23 May, the EU External Action Service listed achievements in building ties with Eastern neighbours: functioning association treaties with Ukraine, Moldova and Georgia, foreseen agreements with Armenia and Azerbaijan and “evolving relations” with Belarus. Such vague phrasing indicates the general slowdown in the Minsk-Brussels re-engagement.

This trend was also noted during Alexander Lukashenka's visit to Rome on 20 May – the first EU trip after lifting of sanctions. Unlike seven years ago, this time he did not meet with the Prime Minister of Italy.

Image-Making Visit

Just as in 2009, when Minsk got brief sanctions' relief, Lukashenka went to Rome as a first destination point. In fact, both – Italy and Vatican seem proper places to serve as "gates to Europe" for the Belarusian leader.

Italian leadership has always been one of the major advocates of pragmatic (some argue – cynical) approach to Belarus. Until recently, two countries had sizable trade – up to 2 bn Euro a year. However, it has fallen threefold in 2015, primarily because the price of refined oil products and potash fertilisers have drastically declined.

Meeting the Pope gives Lukashenka some sort of moral clearance

Meeting the Pope, in its turn, gives Lukashenka some sort of moral clearance; it is supposed to wind down his "non-handshakeble" image in the West.

The meeting in Vatican went almost perfect – the Belarusian leader and Pope Francis exchanged gifts, the latter called Minsk "the place of peace" and Lukashenka said he and the leader of Catholic Church share common vision of the world.

The Pope even received an invitation to Belarus, for a meeting with the Russian Orthodox Patriarch Kirill. This long-held Lukashenka's idea will unlikely come true: two senior clerks have recently met in Cuba for the first time in history; there is no reason to repeat this unique event anytime soon.

Regarding Italy, in contrast with 2009, when Lukashenka held talks with Prime Minister Silvio Berlusconi, now he met just with President Sergio Mattarella. The president in Italy lacks real power and his position is purely nominal. It looks like political leadership of Europe still finds it either inappropriate or unnecessary to meet Lukashenka.

New and Old Challenges on the Way

The developments of recent months show a mixed picture of Minsk-Brussels relations.

On the positive side, a Belarusian-EU investment forum took place in Austria on 24 May. Minsk has sent a high-level delegation, chaired by Deputy Prime Minister Vasil’ Matsiusheuski. More than a hundred companies from both sides came to Vienna to discuss Belarusian investment opportunities. It remains to be seen how fruitful this forum will become in terms of actual contracts, but such event is already an achievement.

​despite the ongoing discussions with the EU and the UN, Belarus continues to practise the death penalty

On the other hand, despite the ongoing discussions with the EU and the UN, Belarus continues to practise the death penalty. Courts have already sentenced three people to death in 2016. Another man Siarhei Ivanou was executed in April.

After the latest death sentence announcement on 19 May the EU issued an unusually harsh statement. Brussels accused Minsk of breaching its commitments to engage in dialogue with the international community on this issue and to consider a temporary moratorium on death penalty.

During his visit to Brussels on 23 May Foreign Minister Uladzimir Makei also reiterated the Belarusian proposal to negotiate a basic treaty with the EU – a framework document that Brussels has with almost every post-soviet state. Still, European officials either remain silent on this initiative or, like the head of EU delegation to Minsk Andrea Wiktorin, say, “the time has not come yet”.

After sanctions relief, Brussels obviously views the upcoming September parliamentary elections as a litmus test for Belarusian authorities. Lukashenka knew that and ordered Central Electoral Commission to come up with something he can offer as a concession to the West.

Lydzia Yarmoshina announced that electoral legislation would remain the same because of “the shortage of time before the elections." 

Head of CEC Lydzia Yarmoshina announced that electoral legislation would remain the same because of “the shortage of time before the elections." However, the CEC promised to adjust some practises to make the process more transparent. It includes letting observers closer to the ballot counting tables, providing them a clear view, giving slightly more rights to international observers, publishing more online data about elections and making local authorities publicly debate each candidacy when composing district electoral commissions.

Needless to say, these cosmetic changes address only a few of 30 recommendations OSCE made after last presidential campaign. Kent Harsted, who headed short-term observers’ mission on 2015 presidential elections, told TUT.BY the OSCE expected legislative changes and had already heard many promises from Minsk. Members of European Parliament, who visited Belarus recently, complained they “did not get comprehensive answers” to their questions from Yarmoshina about planned electoral changes.

Other areas of dialogue like mobility partnership or visa facilitation talks (lasting for 2,5 years) also lack visible progress so far. In addition, Lithuania does it best to raise its concerns about Atravets nuclear power plant to the level of political dialogue between Belarus and the EU. Makei discussed this issue with the Vice-president of the EU Comission Maros Sefcovic in Brussels, which suggests that Vilnius' efforts have achieved certain progress. It might additionally burden the Minsk-Brussels dialogue in the future.

Elections to Become a Turning Point

Recent developments in Belarus-EU relations indicate a degree of mutual disappointment. Brussels expected more readiness to human rights improvements from Minsk. Belarusian authorities hoped to get tangible carrots from the EU sooner. In his recent state of the union address, Lukashenka described the current stage of Minsk-Brussels relations as “a talk-fest”, meaning too many negotiations with little outcome.

If this trend continues, the future of the Belarus-EU thaw will likely depend on the parliamentary elections.

In case the campaign follows the usual scenario or with only cosmetic procedural improvements, the EU might lose its remaining enthusiasm and curb further attempts to engage Belarusian authorities.

On the contrary, some visible progress – such as more inclusive composition of electoral commissions, transparent ballot counting or letting the opposition into parliament – might give the re-approachment with the West a second breathe.

However, knowing the Belarusian authorities’ attitude towards democratic procedures, their deep-held fear of political experiments, the first option seems more feasible. Only serious quarrel with Moscow or truly deep economic downturn can make Lukashenka more inclined to establish new concessions with the West.




Reinforcing the “Remote Arc”, Working Hard at the UN – Belarus Foreign Policy Digest

In April, Belarus and Europe continued re-establishing contact at different levels. Belarus welcomed the Bulgarian foreign minister and senior diplomats from Sweden and Bosnia and Herzegovina. At the institutional level, Minsk and Brussels inaugurated their new dialogue format, the Coordination Group.

Belarus’ economic interests prompted the government to call for stronger relations with the “Remote Arc” countries, in particular, Nigeria and Ghana. In New York, foreign minister Vladimir Makei focused on social issues and development agenda.

Belarus – Europe: the bilateral dimension

On 10-12 April, Bulgarian foreign minister Daniel Mitov paid a working visit to Minsk and met his Belarusian counterpart Vladimir Makei. Mitov stressed Bulgaria’s willingness to contribute to improving Belarus-EU relations but emphasised the need for respect of human rights in Belarus.

Mitov came to Belarus not only in his national capacity but also as the current chairman of the Committee of Ministers of the Council of Europe. Minsk is interested in greater involvement of Belarusian parliamentarians in the work of this organisation. In this context, Mitov met Vladimir Andreichenko, the chairman of the lower house of the Belarusian parliament.

Belarus and Sweden continued to strengthen their bilateral ties, which are now close to full normalisation after the teddy bear airdrop incident in 2012. On 31 March-1 April, state secretary for foreign affairs Annika Söder met Vladimir Makei and his deputy Alena Kupchyna in Minsk. It was the first visit of a Swedish official to Belarus at such a level for 25 years. Söder also met Belarusian opposition leaders.

On 22 April, Belarus and Bosnia and Herzegovina held their first political consultations at the deputy foreign minister level since 2007.

In Minsk, Alena Kupchyna and Josip Brkić focused on further development of the two countries’ trade relations. Belarus and Bosnia and Herzegovina have so far been unable to establish the bilateral trade commission provided for in their trade agreement of 2004.

The parties also discussed regional cooperation, as Bosnia and Herzegovina holds the presidency of the Central European Initiative (CEI) in 2015. Belarus recently downgraded the level of its participation in this regional forum despite the fact that most of the Belarusian government’s sympathisers in Europe (such as Austria, Hungary, Italy, Slovenia etc.) also participate in the CEI.

Belarus – Europe: the institutional dimension

In Brussels on 6-7 April, Belarus and the European Union launched a new format of bilateral dialogue, the EU-Belarus Coordination Group. This informal negotiation platform emerged as a follow-up to the Interim Phase on modernisation issues. Alena Kupchyna and Deputy Secretary General for the External Action Service Helga Schmid headed the respective delegations.

Belarus and the EU identified eleven priorities for the dialogue, with trade, investment, environment and infrastructure dominating the agenda. However, the parties have also been discussing the establishment of a national institute for human rights in Belarus. The EU will sponsor a workshop on this issue in Minsk later this year.

Representatives of Belarusian civil society participated in one session of the coordination group and were able to comment on the dialogue’s priorities. Belarus’ Ministry of Foreign Affairs validated each candidature.

The Konrad Adenauer Foundation financed a trip of a team of Belarusian officials and experts to Brussels on 18-21 April. They discussed security and defence issues with officials from NATO, the European Parliament and the European External Action Service as well as think tanks.

Makei works hard in New York

On 20-22 April, Makei was in New York on an extremely tight schedule. There, he signed the Paris Climate Agreement on behalf of Belarus and spoke at the United Nations' special high-level events on sustainable development goals and drug trafficking.

The minister opened a photo exhibition at the UN headquarters dedicated to the 30th anniversary of the Chernobyl disaster. He also met his counterparts from Argentina, Costa Rica, Singapore and Tajikistan as well as high UN officials.

Finally, Makei participated in the first-ever high-level meeting of the Eastern European Group (EEG). Belarus chairs the group in April. The uniqueness of the EEG is that it assembles the countries which belong to competing economic and military blocs in Europe.

Normally, the EEG’s role has been limited to deciding on the distribution of seats at various UN bodies and performing other procedural functions at the organisation. Lately, Belarus has been working on uniting the EEG’s members behind the common agenda of UN reform and strengthening the group’s role and visibility at the UN.

In recent years, Belarusian diplomats have successfully moved from a reactive response to the UN agenda set by others to identifying and pursuing the country’s priorities in multilateral diplomacy.

Reinforcing the “Remote Arc”

Deputy foreign minister Valentin Rybakov made a tour in Western Africa, visiting Nigeria on 4-5 April and Ghana on 6-7 April.

The political consultations between the foreign ministries were held both in Abudja and Accra. However, trade relations and academic training of African students in Belarus remain at the top of Belarus’ agenda in its relations with Nigeria and Ghana.

Rybakov came to Africa accompanied by Belarusian manufacturers of agricultural and transport machinery. Minsk is seeking to develop local assembly of its tractors in Nigeria and trucks in Ghana.

On 14 April, Belarusian president Alexander Lukashenka, on the sidelines of the summit of the Organisation of Islamic Cooperation, met the leaders of Afghanistan, Indonesia, Qatar and Pakistan, with trade and manufacturing cooperation the focus of the discussions.

On 21-24 April, Nkosazana Dlamini-Zuma, the Chairperson of the African Union Commission, visited Minsk. She met Prime Minister Andrei Kobiakov and first deputy foreign minister Alexander Mikhnevich.

Belarus has rather a limited diplomatic presence in Africa. Cooperation with the African Union may help to enter the African markets and participate in pan-African economic and technical cooperation programmes.

In late April, Belarusian officials also discussed the development of trade relations with Sudan in Minsk and Qatar in Doha in the format of the bilateral cooperation commissions.

Lukashenka recently instructed his government and Belarusian diplomats on the need to achieve a new balance in Belarusian exports. They should be equally distributed – one third each – among the Eurasian Economic Union (EEU), the EU and other countries, including the so called “Remote Arc” countries (Africa, Asia and Latin America).

Currently, the share of the EEU in Belarusian exports stands at over 42 per cent, with the EU at 32 per cent. This means that the share of the “Remote Arc” will have to grow significantly at the expense of Russia and other EEU members.




Belarus between EU and EEU, New Opposition Strategy – Digest of Belarusian Analytics

Over the past month analysts discussed continuing rapprochement of Belarus with the West and potential Russia’s responses to it. Meanwhile, influenced by Russian propaganda, Belarusians favour Eurasian integration over European, although official Minsk finds its result unsatisfactory.

Belarusian opposition changes its strategy in relations with the authorities and plans to push them to negotiations with backing of mass street pressure. However, a Ukrainian sociologist predicts that democracy in Belarus will come not earlier than in 50 years and conditions for a Maidan do not exist there. This and more in the new Digest of Belarusian Analytics.

Foreign policy

Belarus in the EAEC: a Year Later (Disappointing Results and Doubtful Prospects) – This report was presented in Minsk on March 22, by the Center for Strategic and Foreign Policy Studies and the Friedrich Ebert Foundation. The report is devoted to the analysis of the first year of existence of the Eurasian Economic Community (EAEC) for Belarus. Among the key findings is that Minsk had great expectations from this association, but now finds it unsatisfactory.

Europe’s Last Dictator Comes in From the ColdArtyom Shraibman, for Carnegie Moscow Center, notices that Lukashenka’s fortunes have changed. Once known as “Europe’s last dictator,” he has won friends in Europe, while antagonizing his traditional ally, Russia. It’s a situation that has left the Kremlin in a difficult position: should it punish Belarus for its pro-Western tendencies? Or should it continue to prop up the Belarusian economy rather than risk further unrest in the region?

Belarus-Ukraine Relations Beyond Media HeadlinesYauheni Preiherman, in Eurasia Daily Monitor, notices that media narratives often distort the reality of Belarus-Ukraine relations. Some observers explain this by the absence of a “strategic vision for a long-term relationship”. The author sees this a typical feature of inter-state relations in the post-Soviet space, where politics is mainly about tactics, and fighting protectionist trade wars is part of the political culture.

Politics

Belarusian Opposition Comes Up With New Strategy: Negotiations With Authorities Due to Protest Pressure – Politicians and leaders of the mass protests discuss the lessons of "The Square-2006". The new strategy is likely to depart from the revolutionary approach to power change and focus on evolutionary approach, by changing relations between the authorities and the opposition through negotiations, backed by mass street pressure.

Ukrainian Sociologist: Maidan will not be in Minsk – Democracy in Belarus will come not earlier than in 50 years. This will happen only when society is ready for this. Artificial imposition of liberal values does not work, as well as there are no political or social preconditions for Maidan of the Kyiv scenario in Minsk, according to Ukrainian sociologist, Professor Eduard Afonin.

Public opinion polls

Majority of Belarusians want to keep death penalty. According to the March national poll conducted by IISEPS, 51.5% of Belarusians do not agree with the idea to abolish the death penalty; opposite opinion is shared by 36.4%. Women are less in favor of abolition of the death penalty than men – respectively 55.3% and 46.9%. Belarus is the only country in Europe and on the post-soviet space, which still applies the death penalty.

Belarus Between EU and EEU. Nation-Wide Poll – The ODB Brussels commissioned a survey about perceptions, preferences, and values Belarusians attribute to the European Union (EU) and the Eurasian Economic Union (EEU). According to the study, Belarusians have a high-level understanding and appreciation of the EU, a clear opinion that the EU and EEU are competitors while public reasoning is currently swayed in favor of economic cooperation with the EEU.

Peculiarities of Public Opinion in BelarusGrigory Ioffe overviews the key results of a fresh national poll by IISEPS and an alarming reaction of official sociologists to the results, namely, the decline in Alexander Lukashenka’s electoral rating. Siarhei Nikalyuk, an associate of IISEPS, suggests that independent sociologists who are de facto allowed to work in Belarus are playing the role that jesters did in medieval Europe. After all, only a jester was allowed to speak the truth to the monarch, who actually appreciated that.

Other

Advocacy Sector in Belarus: CSO Experience – The study analyses the actual practices of advocacy in Belarus for the recent five years. The researchers see the key factor of success/failure of any campaign in its capacity for politicisation, i.e. whether authorities perceive a campaign political or not. The study was commissioned by OEEC in a series of sectoral studies aimed at summarising data on the development of specific sectors of civil society in Belarus. The presentation was held on March 24.

How to Make Minsk a Cycling City? – Pavel Harbunou, the Minsk Bicycle Society, shares the results of an annual monitoring on bicycle traffic on the Minsk streets, which shows that the number of cyclists has increased significantly in the city. The activists tells what can be done to make Minsk comfortable for all road users. Namely, the Bicycle Society launches a new campaign Street Bike Supervisor aimed to provide a regular feedback on the conditions of Minsk streets.

Ghetto for Each. Why Minsk Art Spaces Live Separately From Each OtherBelarusian Journal online describes the existing art spaces in Minsk, both mainstream and alternative. While a growing number of cultural spaces is a positive sign, it is too early to talk about the impact of these spaces for culture in general. It is more a question of the formation of separate subcultural groups, the original "ghetto" that arise, rather against the wishes of the state.​

Belarus Digest prepared this overview on the basis of materials provided by Pact. This digest attempts to give a richer picture of the recent political and civil society events in Belarus. It often goes beyond the hot stories already available in English-language media.




Upgrading Relations with Europe, Winning in an Embassy Row – Belarus Foreign Policy Digest

In recent weeks, Belarus managed to noticeably upgrade the level of its relations with EU countries. However, the ministerial-level meetings have been limited to Belarus’ long-time sympathisers in Europe (Hungary and Slovenia) as well as its closest neighbours (Poland).

The relations with the United States have maintained their positive dynamics but remained at the expert level. The embassy row with Israel has ended with a victory of Belarusian diplomats.

Visiting “friend Szijjártó”

On 16–17 March, Belarus' foreign minister Vladimir Makei paid an official visit to Hungary. The Belarusian foreign ministry made no prior announcement of the visit. It released its first communiqué when Makei almost exhausted his agenda in Budapest.

Makei had talks with his Hungarian counterpart, Péter Szijjártó, and met high government and parliamentary officials as well as potential investors.

Belarus and Hungary focused on the ways to develop economic cooperation, with priority attention given to agriculture and food processing, mechanical engineering, pharmaceuticals, construction, telecommunications and tourism.

Belarus seeks to play the card of Hungary’s independent position towards Brussels on several policy issues, including the EU’s relations with Belarus and Russia.

Makei: "Any state's task... is to find legal ways of circumventing sanctions"

Makei and Hungarian politicians favour pragmatism and prioritise economic interests over human rights and democracy considerations. In his interview to a conservative Hungarian daily, the Belarusian minister advocated search for “legal ways of circumventing sanctions”, referring to the EU and Russia's reciprocal embargoes.

Today's atmosphere of bilateral relations is prone to higher-level contacts between Belarus and Hungary. One should not exclude a possibility of a meeting between Alexander Lukashenka and Viktor Orbán in 2016.

Exploring new investment projects with Slovenia

On 25 March, Slovenia’s foreign minister Karl Erjavec visited Belarus accompanied by representatives of eleven Slovenian companies in a bid to strengthen bilateral relations and look for new economic opportunities.

The Slovenian politician met his Belarusian counterpart and was received by President Alexander Lukashenka. The identified priorities in economic cooperation match those in relations between Belarus and Hungary, with addition of power industry.

Erjavec attended the opening of the transformer station in Minsk build by Slovenia’s civil engineering giant, Riko Group. In presence of the two countries’ foreign ministers, Riko Group signed new cooperation agreements with local energy agencies.

In February 2012, Slovenia vetoed the introduction of the EU’s sanctions against Yury Chyzh, a Belarusian oligarch who was then closely linked with Alexander Lukashenka (but recently detained). At that time, Riko Group was implementing a large construction project in Belarus with one of Chyzh’s companies.

Alexander Lukashenka did not fail to thank the Slovenian diplomat for the “position, which Slovenia [had] taken in recent years on Belarus, in particular, when discussing problems with the EU”.

Discussing “most sensitive issues” with Poland

In between his encounters with the regime’s probably strongest allies in the EU, on 22-23 March, Vladimir Makei welcomed in Minsk Poland’s foreign minister Witold Waszczykowski. President Alexander Lukashenka also received the Polish official.

While trade and investment relations have kept their traditionally important place in the bilateral dialogue, the parties discussed other issues extensively.

Belarus and Poland seek to further reinforce their shared border and agreed to seek financing from the EU funds while the security of the EU’s external borders remained a hot topic in European capitals.

Lukashenka thanked Poland for seeing Belarus as a sovereign and independent country

Poland would like to see progress in the treatment of Polish minority in Belarus. The Polish government also worries about the situation of the Catholic Church in Belarus, especially regarding the status of Polish clergy in the country.

Alexander Lukashenka reassured Waszczykowski about his intention to guarantee equal rights of all ethnic groups and creeds in the country. Vladimir Makei also mentioned the two countries’ “willingness to seek mutually beneficial solutions to absolutely all issues, including the most sensitive ones”.

However, one should not expect a quick progress on the matters involving human rights and democratic freedoms in Belarus. The Belarusian authorities manage very well to use these issues as a bargaining tool in a prolonged diplomatic game.

Honouring a US expert

On 28-30 March, Michael Carpenter, US deputy assistant secretary of defence, visited Minsk to meet Alexander Lukashenka, Vladimir Makei and Belarus’ defence minister Andrei Ravkov.

Carpenter is a top expert of the US department of defence for the ex-USSR. However, his strictly mid-level position in a bureaucratic hierarchy would preclude his direct talks with top government officials in most other countries. However, lately Lukashenka chooses to disregard such subtleties.

The US expert focused on bilateral relations with Belarus in the security and defence areas as well as on the situation in neighbouring Ukraine. Lukashenka used this opportunity to reiterate his earlier calls for a greater US involvement in the resolution of the crisis around Ukraine.

In dissonance with Russian politicians, the Belarusian president admitted that he was not inclined to demonise NATO’s expansion eastward and to think that NATO was going to wage a war against Russia or Belarus.

The Belarusian leader also chose to talk with the security expert about expanding economic ties between Belarus and the United States.

Ending embassy row with Israel

Belarus and Israel are close to a full resolution of the recent embassy row. The situation in bilateral relations quickly deteriorated in early January when Israel announced the imminent closure of its embassy in Minsk. Belarus immediately retaliated by announcing the symmetrical withdrawal of its mission in Tel Aviv.

Within a few weeks, influential Israeli politicians began sending repeated signals that their government’s decision would most likely be revoked. However, the Belarusian foreign ministry refused to suspend measures directed at phasing out its diplomatic presence in Israel. Several diplomats returned to Minsk. The embassy suspended some consular services.

Even the publication of the decision to maintain the embassy on the Israeli government's web site failed to satisfy Belarusian diplomats.

Only after having received a formal notification from Israel’s foreign ministry in late March, the Belarusian foreign ministry admitted that it got formal grounds for reconsidering the issue of Belarus’ diplomatic presence in Tel Aviv.

Belarusian diplomacy has scored another victory in already the second embassy row with Israel. This time, a more resolute retaliation led to a much quicker restoration of status quo.




Closing the Gap Between Minsk and Belarus regions

In 2015, real wages declined everywhere in Belarus save Minsk, according to recently-published data from the Belarusian Statistical Committee. This easily explains why so many Belarusians are moving from the regions to the capital.

The role of Minsk in the demography and economy of Belarus keeps growing, while the periphery is falling into depression. People there live worse and for fewer years than in the capital.

The authorities recognise a third of districts of Belarus as depressed, but they can only reverse this trend on condition that they fix the economy in the whole country and adopt a pro-growth package deal for the regions.

The European Union is currently helping the Belarusian authorities to produce Strategies for sustainable development of the regions 2016-2025. So far, these documents remain vague, but with further revisions could serve many districts across the country well.

Growing Role of Minsk

Belarus has six regions: Minsk, Viciebsk, Hrodna, Homiel, Mahiliou and Brest. Each is divided into districts, of which Belarus has 118 in total. Minsk stands apart, and its role in the country is becoming even more significant.

According to the Belarusian Statistical Committee, 20 years ago 16.5 per cent of Belarusians lived in the capital, while in 2016 more than 20 per cent do. In practice, the number of people living in Minsk is probably even bigger, because official statistics do not properly take account of students and other visitors. Even while in 1996-2016 the population throughout the country fell by 678,000, in the Belarusian capital it grew by 290,000.

Minsk's share in the economy has also increased. In January 2016, the contribution of Minsk in the country's GDP was 26.1 per cent. This is four times higher than that of Mahiliou region in the east of the country. According to a 2014 study by CASE Belarus, an economic think tank, labour productivity in Minsk is three times higher than in the Belarusian regions.

Minsk attracts the most active and capable Belarusians as well as investments – around 70 per cent of all investments in the country come to the capital. The regions are meanwhile becoming a "poverty belt" made up of elderly populations.

Similar processes are occurring in many countries in Eastern Europe, but in Belarus the problem is that the economic crisis exacerbates the phenomenon. Now, for many people from the regions moving to Minsk has become almost the only chance for a decent life. If a resident of Minsk earned $565 a month on average in 2015, people outside the capital earned a third less.

Life in the Capital and Regions

According to the Belarusian Statistical Committee, in 2015 real wages in Belarus decreased by a few per cent in all regions of Belarus except Minsk. Growth there was about 0.1 per cent.

The quality of life in the capital remains much better in many respects. People in the regions live two or three years fewer than in the capital on average, according to the official data. The number of secondary schools is declining in the regions, and the biggest medical staff shortages are there too. According to the Minister of Health, in some cities the lack of medical personnel reaches a 40 per cent shortfall. The likelihood of living below the poverty line is five times higher if a person does not live in Minsk.

Smaller towns are becoming even smaller in Belarus. According to a Ministry of Economy forecast, the number of districts with an unsustainable number of residents (15,000-20,000 people) will grow from 51 in 2013 to 77 in 2032. According to the authorities, every region needs more than 20,000 inhabitants for sustainable development.

The regions lack any sign of political life. The Belarusian opposition has not held massive rallies outside the capital for several years. There has in the last few years been a boom in public lectures in Minsk, but in the regions they remain rare.

Furthermore, Belarus, as well as many countries of the former Soviet Union and in contrast to many Western countries, remains overly centralised. All ministries and agencies are governed from Minsk. It gives the impression that public activities exist only inside the Minsk ring road.

Dealing with the new reality

It seems that until 2012 the Belarusian authorities had never used the term "depressed region" – it denotes an area with high unemployment and a low standard of living. But since then they have done so several times.

According to Ministry of Economy estimates from August 2012, one-third of the Belarusian regions appeared depressed at that time. That means that 31 per cent of districts had reduced their income by more than 35 per cent. The National Bank conducted its own study on tax collection and got the same result – about a third of areas were depressed.

Because of the economic crisis things have only become worse. In 2015, the Ministry of Finance published data showing that now every fourth region earns only 20-40 per cent of its budget and central government subsidies supply the rest.

The authorities are trying to do at least something. They have freed entrepreneurs in small towns and rural areas from the obligation to pay some taxes. Under an EU-funded project, Belarus together with international experts has developed strategies of development for the regions. While these strategies mark a step forward, they remain vague.

Anton Radniankou, manager at the Interakcia local foundation, told Belarus Digest that the EU-funded documents mostly repeat the same strengths for all regions (geographical position, industry, nature, etc.). Moreover, the strategies sound unrealistic, proposing the creation of many innovative clusters while many Belarusian regions lack money to keep themselves afloat.

While EU-funded projects can serve as a backbone, they should be updated with the inclusion of as many stake-holders as possible, working out of specific, smart specialisations for districts and scenario-planning.

Many regions these days desperately need a robust pro-growth strategy with stable tax regulations and incentives for innovative enterprises. While the authorities promised not to introduce new taxes in 2015-2020, they keep breaking this promise. Currently many entrepreneurs lack access to bank loans and business incubators.

The state authorities should attract foreign investment to the regions on very preferential conditions and even move some headquarters of the ministries to the regions. Minsk will not notice it, but relocating the National Bank outside Minsk will create new jobs and improve the quality of life in the regions.

Moreover, in order to save the regions, the government should take more radical steps to reform the economy. The increase in the number of depressed regions of Belarus is not a result of failures at the local level, but above all the flaws in the whole economic model of Belarus.




Belarusian Diplomacy in 2015 – Annual Foreign Policy Digest

On 6 January, the Belarusian foreign ministry published an annual review of Belarus’ foreign policy (in Russian only). The document, in bureaucratic lingo, tediously reports on the ministry’s achievements and activities in 2015.

Belarus Digest offers its own subjective summary of Belarusian diplomats’ most notable successes and failures in the past year in a "top ten" format. In most cases, the results were mixed, however.

 

Getting the sanctions suspended. In October, the European Union suspended for four months its restrictive measures against many Belarusian companies and individuals. In coordination with the EU, the United States also provided a six-month long reprieve from sanctions for nine major petrochemical enterprises.

Belarusian and Western diplomats carefully crafted this milestone in their step-by-step strategy of improving relations through months of negotiations. However, it became possible only after the authorities released political prisoners and held presidential elections in a peaceful manner.

Facilitating the Minsk agreements. In February, the German chancellor and presidents of France, Russia and Ukraine met in Minsk to negotiate a peace deal on Ukraine. The resulting Minsk agreements have become a reference point for further efforts to resolve this crisis. The Belarusian capital gained immediate and lasting international notoriety.

Belarusian president Alexander Lukashenka finally got direct access to the true European decision-makers. Angela Merkel and François Hollande, by their mere appearance in Belarus, broke Lukashenka’s isolation and blessed Minsk’s claims of becoming a regional diplomacy hub.

Building brand-new ties with Europe. Building a strong web of bilateral and institutional ties with Europe, Belarus held meetings of commissions on trade and economic cooperation with thirteen countries and political consultations with twenty-two European states, including France, Italy, Sweden and most Central and Eastern European nations. Belarusian diplomats tried to leave out from discussion, whenever possible, political and human rights issues, topics on which disagreements remain substantial.

However, Belarus did not exchange highest-level visits with EU countries in 2015. Alexander Lukashenka met his counterparts from Austria and Latvia only on the sidelines of the UN summit. His foreign minister Vladimir Makei paid visits to Berlin and received his colleagues from Austria, Hungary, Latvia and Lithuania in Minsk.

 

Achieving a thaw in relations with the US. Dialogue with America was far less intense than that which Minsk established with Europe. The United States is deeply mistrustful of Belarus’ intentions. However, the two countries were able to launch a “virtuous cycle” in bilateral relations in which the positive steps of one are responded to in kind.

Several US delegations visited Belarus in 2015. Alexander Lukashenka received some of them in a baffling disregard for diplomatic protocol. Belarus and the US began discussing human rights and the gradual resumption of their embassies’ normal functions.

Reinventing the Eurasian dimension. In July, Belarus obtained the long-sought prize of observer status in the Shanghai Cooperation Organisation. However, it is unlikely to provide any real added value for Belarus, besides some PR benefits. The same applies to the country’s contacts with the BRICS (Brazil, Russia, India, China and South Africa).

The state visit of Xi Jinping, China’s “paramount leader”, to Minsk in May was labelled as a “milestone” in bilateral relations. Belarus hopes to lure more Chinese investment into the country and get the Celestial Empire interested in importing more Belarusian goods. However, doubts remain about how genuine Beijing's interest is in Belarus' exaggerated offer of becoming a China's gateway to Europe.

Advocating the Eurasian Union. Belarus, as the current chair of the Eurasian Economic Union (EEU), invested a lot of effort in the international promotion of this project. Belarusian embassies made a pitch for investing in and trading with the EEU at every opportunity.

 

In this vein, Belarus sought to obtain observer status for the EEU at the UN. The Belarusian mission in New York failed to forge a consensus on this initiative because Azerbaijan, Georgia and Turkey opposed it. The international status of the EEU was falling victim to problems which some of its members have in bilateral relations with third states.

 

Promoting the “integration of integrations”. Belarus remained charmed by the verbal beauty of the idea of “integration of integrations”, seeing it mostly as a “Greater Europe from Lisbon to Vladivostok”. Lukashenka and Makei promoted the concept during bilateral meetings, at the UN summit in September and at the Eastern Partnership summit in Minsk.

In October, Belarus tried to engage the EU in a practical consideration of this idea, submitting a non-paper to this effect in Brussels. The European Commission responded to this invitation by a letter that its President Jean-Claude Juncker sent to … Vladimir Putin in November. This was a slap in the face for Belarus’ president and an indication that the EU understood the real nature of the Eurasian integration project.

Negotiating visa facilitation with Europe. In 2015, Belarus and the EU failed to complete the visa facilitation talks that they so successfully launched in 2014. Belarusian negotiators expected the agreement to be initialled at the May Eastern Partnership summit in Riga. This did not happen as some “technical details’ needed further discussion.

In November, a senior EU official announced that the visa facilitation and readmission agreements were ready for signing as soon as Belarus upgraded its diplomatic passports. The Belarusian foreign ministry promptly contested this assertion without elaborating on outstanding issues.

Resisting a single visa regime with Russia. Lately, Russia has been obstinately probing Belarus’ position on a single visa regime between the two countries. In March, Moscow brought in the big guns when Vladimir Putin announced upcoming talks on the issue. Russia wants the single visa space as a means of exercising stronger leverage over Belarus’ relations with third countries.

Belarus has so far refused to confirm the existence of such plans, reaffirming that the country's approach on the matter had "undergone no fundamental changes". Its foreign ministry has instructions to agree on nothing beyond a coordinated visa policy.

Fighting the human rights battle. Belarus stuck to its stubborn denial of the dire human rights situation in the country. In October and November, it fought vehemently at the UN against the country-specific procedures, one of which targets Belarus. On this matter Belarusian diplomats enjoy the support of many like-minded human rights pariahs. Belarus also failed to cooperate properly regarding thematic human rights procedures, i.e. on human rights defenders.

Meanwhile, Belarus conducted two rounds of human rights dialogue with the US and one with the EU, as a part of the step-by-step strategy of improving bilateral relations. In September, Lukashenka unexpectedly talked to Zeid Ra’ad Al Hussein, High Commissioner for Human Rights, on the sidelines of the UN summit in New York.

 

 

In 2016, Belarus’ foreign policy priorities will not change much. The foreign ministry will focus on the definitive abolition of Western sanctions, increasing export revenues and luring foreign loans and investments. It will also rekindle the issue of international post-Chernobyl assistance.




Successful Foreign Policy, EEU Decline, Cross-Border Projects – State Press Digest

According to Belarusian state-controlled press, 2015 was a successful year for Belarusian foreign policy, as the country strengthened its position in international affairs and relations with key western actors.

The national budget for 2016 reflects the impact of the ongoing economic crisis and will see the government support only the most vulnerable categories of society, siloviki in particular.

Eurasian Economic Union (EEU) trade continues to fall because of the regional economic crisis and protectionist policies of the bloc's members. Belarus is gradually abolishing subsidies in the energy sector as part of market reforms.

The regions of Belarus are actively engaging in cross-border cooperation projects financed by the EU. All of this and more is discussed in the latest edition of State Press Digest.

Government considers 2015 foreign policy a success

In 2015 Belarus led a successful foreign policy. Belarus Segodnya presents the annual Review of the Foreign Policy Outcomes and Activities of the Foreign Ministry. During presidential elections, which the Ministry sees as the main event, it managed to organise constructive cooperation with international observers. These observers' reports had a significant impact on further positive development of relations with foreign, and especially western, partners.

In 2015 Belarus made a significant contribution to de-escalation of the Ukraine conflict and maintenance of stability in the region. Belarus also continues to promote the concept of “integration of integration” – convergence of the European and Eurasian integration programmes. However, the review regrets that the key problem within the EEU – trade exemptions and protectionism – has not been overcome.

Eurasian Economic Union demonstrates trade decline

The new budget will prioritise financial support for police and army personnel. Narodnaja Hazieta publishes an interview with MP and member of the standing committee on budget and finance of the Belarusian parliament Valier Baradzienia. According to the official, the fast economic growth of previous years is over, Belarus is losing markets and its GDP is falling, leading to a budget deficit.

The authorities will cut expenses, but this will not apply to social commitments such as education and healthcare. Salary growth can be expected in the public sector, but it will vary according to each sphere. Teachers may receive additional income from private tutoring and healthcare workers can offer paid services to citizens, while such possibilities are not open to police and army personnel. The state is therefore obliged to protect them, the MP said.

Eurasian Economic Union (EEU) demonstrates decline in mutual trade. In 2015 trade within the EEU decreased by 25 per cent, writes Sielskaya Gazieta. However, trade within the union has in fact been falling ever since the launch of its predecessor, the Customs Union, in 2011. Stumbling oil prices and sanctions against Russia are only part of the problem. Members of the union continue to put national economic interest above the integration ideal and retain protectionist policies.

In the last year bans on imports of certain categories of goods became standard practice for EEU members. For Belarus this concerns primarily food products, which Russia constantly claims do not meet EEU standards. Moreover, Kazakhstan's accession to the World Trade Organisation (WTO) further limits Belarus' export possibilities to the EEU.

Belarus plans to completely abolish cross-subsidies to the energy sector by 2018. Today enterprises in fact pay for a large part of the population's energy consumption, Zviazda newspaper reports. Belarusians pay 72 per cent of electricity costs, 55 per cent of gas costs and only 17 per cent of heating costs. These subsidies have been a part of the state's social policy throughout independence and received much criticism from Belarus' international creditors who promote market reforms.

The estates of noblemen of Hrodna region are sold off to investors. The 18th century estate of the Umiastoŭskija noble family located in Iŭje district has been sold at auction to a Jordan businessman for $55,000, Respublika newspaper reports. According to the auction conditions, the investor has promised to restore the buildings to their original form and turn them into a hotel and a restaurant.

The estate until the auction belonged to a local collective farm and is in a dire state. The authorities have no funds for restoration of architectural heritage, and many similar estates are slowly crumble as a result. Twelve estates in Hrodna region acquired new owners in recent years, but some of them are in no hurry to carry out restoration works and the government even plans to take some of the estates back.

Belarus engages in cross-border projects with the EU

Hrodna region actively participates in EU cross-border cooperation projects. The local authorities of Hrodna region have prepared around 50 projects for EU-financed cross border cooperation programmes with Poland-Belarus-Ukraine and Latvia-Lithuania-Belarus, Hrodzienskaja Praŭda reports. The projects mostly concern healthcare, education and culture.

The programmes require partnership from both sides of the border, and half of the projects already have foreign partners. To present the other half for potential partners, the authorities plan to organise a forum in Bialystok. The Poland-Belarus-Ukraine programe for 2016-2020 will allocate about €180m for cross-border cooperation projects.

Belarusians will not have to take Russian language exams to receive work permits for Russia. As Soyuz newspaper reports,the Russian State Duma passed a law exempting Belarusians from the obligation to confirm their command of the Russian language and knowledge of Russian history and law as a requirement for obtaining a residence or work permit. The norm became effective in Russia on 1 January 2015 and concerned all foreign citizens, including Belarusians.

The regulation caused much opposition in Belarus, where Russian is one of the two official languages and in fact dominates all spheres of life. The problem was widely discussed, and Lukashenka personally lobbied on it during his visit to Russia in December, ultimately receiving approval from Putin.

The State Digest 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.