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The Ailing Belarusian Economy And Lukashenka’s Plea On Big Brother’s Behalf – Analysis

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By Grigory Ioffe*

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According to a January 2022 forecast published by the World Bank, the Belarusian economy would contract by 2.8 percent over the course of the year. But in April, the international financial institution sharply revised down its estimate to a drop of 6.5 percent. The April forecast additionally envisages a 45.1 percent GDP collapse in war-torn Ukraine and a not-small 11.2 percent decline of the Russian economy (Intex-press, April 14). Already in the first quarter (January–April 2022), Belarus’s economic recession amounted to 2.1 percent compared to the same period in 2021. Last year, Belarus’s GDP grew by 2.3 percent; and the government in Minsk had then predicted 2.9 percent growth for 2022. However, these prognostications were made before the outbreak of Russia’s unprovoked full-scale war against Ukraine and the ensuing sanctions against both Moscow and its closest ally, Minsk. The World Bank also predicts that Belarusian exports will shrink by 14.2 percent and imports will fall by 18.8 percent (Zerkalo, May 17). Because the Belarusian economy is much more open (i.e., export-oriented) compared to Russia’s, this projected decline is nothing short of cataclysmic.

Since sanctions precluded Belarusian exports of refined oil to the European Union, two Belarusian refineries have scaled down their operations. They are now tasked solely with meeting domestic demand. According to Prime Minister Roman Golovchenko, the Novopolotsk-based Naftan facility is now processing 11,700 tons of crude oil per day, whereas Mozyr Refinery handles 13,700 tons per day. For comparison, in 2020, the Mozyr plant processed 24,000–25,000 tons per day (Belta, April 7). When the presidents of Russia and Belarus met in Moscow on May 16, their 40-minute conversation included a discussion of coordination in the area of import substitution, the transshipment of Belarusian cargo via Russian seaports, and the construction of a “Belarusian port” near St. Petersburg, in the vicinity of the existing Bronka deep-sea terminal (Belta, May 16).

In his interview to Al-Arabiya, a Saudi TV channel, Golovchenko declared that the goal of the current Western sanctions is to “bring Belarus to its knees, strangle it economically and thus achieve fulfilling some demands.” According to Golovchenko, “due to sanctions, almost all exports of Belarus to the countries of the EU and North America were blocked. This amounts to about $16 billion–18 billion a year.” Golovchenko pledged a reorientation of exports to other regions of the world (Belta, May 15).

Yury Drakakhrust of Radio Liberty, however, suggested that Prime Minister Golovchenko’s estimate was too high. According to the website of the Belarusian embassy in Brussels, exports of goods and services to the EU in 2021 equaled $12.24 billion. While Belstat (the statistical service of the Belarusian government) notes that exports of goods to the US last year amounted to $490 million and exports of services (for the most part IT) were valued at $1.51 billion (Zerkalo, May 16). As a matter of fact, in 2021, the US was Belarus’s tenth-largest trading partner. In descending order of monetary value, Belarusian top exports to the US included particle board, pipes for oil and natural gas pipelines, x-ray equipment, furniture, food, linen fabrics, building joinery, optical fibers, and lenses (Belmarket, May 18).

In any case, the sum total of Belarusian exports to the EU and the US together was $14.24 billion. So why is this talk about $16 billion–18 billion of lost Belarusian exports due to Western sanctions? Drakakhrust thinks the exaggeration is due to an ideologically inspired change in messaging. Whereas previously, the government was prone to swagger—“we are strong and invincible to sanctions”—now that those sanctions have begun to bite, the desire to blame them for all sorts of failures gained the upper hand. In all fairness, however, part of the overall economic loss is due to the immediate effect of the war next door—i.e., the elimination of Ukraine as Belarus’s second-largest trading partner and of transit routes through Ukraine (Zerkalo, May 16).

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On May 16, Belarusian President Alyaksandr Lukashenka attended the summit of the Collective Security Treaty Organization (CSTO) in Moscow. Though, formally speaking, the event was devoted to the 30th anniversary of the respective treaty and the 20th anniversary of the institutionalization of the alliance as an organization, the war in Ukraine took center stage in two speeches—those of Russian President Vladimir Putin and President Lukashenka. No other leader (including the heads of Armenia, Kazakhstan, Kyrgyzstan or Tajikistan) uttered a word about Ukraine in his remarks, and no common document devoted to Russia’s military operation was adopted. Effectively, this meant a conspicuous absence of open support for Russia’s war by its closest allies—except from Belarus.

Lukashenka’s speech at the summit reframed his country’s strategic isolation into a plea to recoup and boost the CSTO’s inner bonds of solidarity. The Belarusian head of state’s introduction contained the now-routine references to the pending end of the unipolar world order (which the West is purportedly trying to postpone through hybrid aggression against Russia and Belarus), to Washington’s alleged desire to prolong the armed conflict in Ukraine, as well as to the supposed attempts—on the part of some neighboring countries—to partition Ukraine. Following that preamble, Lukashenka proceeded to reproach his non-Russian colleagues in a not-so-subtle fashion. He rhetorically asked who was keeping the post-Soviet regionalist grouping from showing “the inner-bloc discipline that the European Union is exhibiting.” And he obliged every CSTO member to act concertedly, including those that disagree with the collectively adopted decisions. Lukashenka reminded his counterparts of the positive experience of rescuing Kazakhstan from a coup attempt last January (see EDM, January 18, 19, 20, 21). But he then lamented that some CSTO countries block flights from other alliance members, apparently alluding to Kazakhstan’s recent demand to cancel Belavia flights from Minsk to Almaty (Capital.kz, May 5); and he accused unnamed CSTO members of voting against the war in the multinational institutions that want to sanction and exclude Russia and Belarus (President.gov.by, May 16).

Apparently, the regional bonds of solidarity Lukashenka wants to recover are indeed frail, but so is his ability to achieve the desired result. Whereas in George Orwell’s 1984—the book whose translation has just been banned in Belarus (Obzor.lt, May 19)—Big Brother presides over Oceania, in today’s real world, he is in charge of Eurasia. And perhaps Big Brother himself has so alarmed the Eurasian leaders attending the May 16 Moscow summit that no plea on his behalf for regionalist unity will resonate.

*About the author: Grigory Ioffe was born and raised in Moscow, Russia, and graduated from Moscow State University where he majored in Human Geography. He emigrated to the United States in 1989. Since 1990, he has been affiliated with Radford University in Radford, Virginia, where he is a professor of geography. Dr. Ioffe has been active in Belarusian studies since 2002. He has authored and co-authored multiple peer-refereed articles on Belarus, including “Geostrategic Interest and Democracy Promotion: Evidence from the Post-Soviet Space” in Europe-Asia Studies (2013); “Debating Belarus: An Economy in Comparative Perspective” in Eurasian Geography and Economics (2011) (co-authored with Viachaslau Yarashevich); as well as “Belarus and the West: From Estrangement to Honeymoon” in the Journal of Communist Studies and Transition Politics (2011). Ioffe’s book, Understanding Belarus and How Western Foreign Policy Misses the Mark was published by Rowman and Littlefield in 2008 and again in 2014. Published in 2014 by Palgrave Macmillan, his book Reassessing Lukashenka: Belarus in Cultural and Geopolitical Context is based on extensive interviews with the Belarusian leader. Ioffe also co-authored the third edition of Historical Dictionary of Belarus, published by Rowman and Littlefield in 2018. He regularly writes about Belarus for the Eurasia Daily Monitor.

Source: This article was published by The Jamestown Foundation’s Eurasia Daily Monitor Volume: 19 Issue: 77

The Jamestown Foundation

The Jamestown Foundation’s mission is to inform and educate policy makers and the broader community about events and trends in those societies which are strategically or tactically important to the United States and which frequently restrict access to such information. Utilizing indigenous and primary sources, Jamestown’s material is delivered without political bias, filter or agenda. It is often the only source of information which should be, but is not always, available through official or intelligence channels, especially in regard to Eurasia and terrorism.

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