Impacts of lifting of EU sanctions on Belarus

  • Roksolana Dryndak
  • 20.4.2016 15:42

On 15th February 2016, the European Union with final validity lifted sanctions against three Belarusian companies and 170 individuals associated with the regime of Alexander Lukashenko. It is yet another step in a thawing of relations between the EU and Belarus. To what extent can the EU exploit Russia's economic weakness to expand its relations with Belarus?

On 15th February 2016, the European Union with final validity lifted sanctions against three Belarusian companies and 170 individuals associated with the regime of Alexander Lukashenko. Restrictions still remain in force for four persons responsible for the disappearance of political activists during the period between 1999 – 2000 and the embargo on the import and export of weapons remain intact as well. The Council of the European Union decided so after a four-month trial period and by doing so it started the next phase of warming relations with Belarus. This step is especially significant in the context of a sharp aggravation of relations between the European Union and the Russian Federation. The question is whether this release will have the desired impact on the liberalisation of the regime or if it is just another step that will not result in any changes in regime and will only help to maintain the Lukashenko's regime.

Federica Mogherini, the High Representative of the European Union for Foreign Affairs and Security Policy, stated as a reason for the lifting of sanctions a positive trend of loosening of the authoritarian regime. The main impulse was likely the November release of several political prisoners, as well as a considerable role of Belarus as a mediator in negotiations concerning the Minsk agreements between the Russian Federation, Ukraine and Donbass separatists. The main objective of the lifting of sanctions is according to the European representatives the support of liberal tendencies of the regime. The Union also hopes that the lifting of sanctions also promises amendments of the Belarusian electoral law as soon as in 2016 and the establishment of new political parties – no new party has been established in the country since 2000. In the context of a real development, it is evident that the hope for liberalisation and the release of political activists were not the only reasons for such an important decision. It can be concluded that the effort to bring Belarus closer to the Union played a major role while this step was made possible by the current economic situation in the Russian Federation, on which Belarus is heavily dependent. The combination of the effects of sanctions against Russian companies and low oil prices significantly limit the influx of Russian capital to Belarus as well as Russia's willingness to constantly save the Belarusian budget by loans and low oil prices.

If we look at the degree of liberalisation of the regime, according to the report by the United Nations, no changes happened. There was no relieving of pressure on civil society or media. No changes have been passed regarding the composition of the high state authorities and there were no talks between the current organisation and the opposition. Although the action plan of the Union includes support of political pluralism in the countries of the Eastern Europe, hoping for a stronger involvement of the Belarusian opposition is pointless. The Belarusian opposition has long been characterised by its weak internal organisation, the inability of the opposition parties to agree on a common strategic plan and fundamental principles and especially by the great personal ambition of individual politicians. This became especially evident in 2010 when after the presidential elections about 40 thousand people attended an anti-regime demonstration in the streets of Minsk. The opposition was not even able to act unified on a stage, not to mention provide a realistic scenario in the fight against the regime. Since 2010 there has been no major figure in the political field. Since Lukashenko's ascent to power, no new political party was established and a negligible role of the opposition creates only an illusion of political pluralism. The absence of any program and particularly no interest and confidence of the population excludes its readiness for action in a foreseeable future.

From the long-term point of view, the lifting of restrictions was an expected step in the framework of relations between the Union and Belarus – a circle of imposition and lifting of sanctions has been repeated several times already. The first imposition of sanctions dates back to 2004 when the European Union with a long delay reacted to the fact that the Belarusian prosecutor's office had not even begun the investigation of the disappearances of political activists Viktor Gonchar, Yury Zacharanka, businessman Anatoly Krasouski and journalist Dmitri Zavadski from 1999 to 2000. What followed was a sequence of new partial restrictions that were always imposed a year after the presidential and parliamentary elections, which were considered rigged. The sanctions were aimed at the individuals and companies close to the country's political top. They contained restrictions on the entrance of people on the European Union soil, freezing of financial capital of companies and individuals and an embargo on the import and export of weapons and equipment which might be used for internal repression (batons, instruments of torture etc.). In 2008, a major diplomatic rift occurred when Alexander Lukashenko ordered the eviction of Western diplomats from their designated residences. The EU countries responded by a withdrawal of their ambassadors and a tightening of sanctions. However, after only eight months the diplomats could go back and the tightening has been withdrawn. Another important milestone was the year 2010 when after the presidential election ten thousand people demonstrated in the streets of Minsk to protest against the rigged election. This gathering was brutally dispersed, more than 600 people were arrested while four people were sentenced to up to seven years in prison. Among detained people were also four out of nine presidential candidates.

Although according to the analyses of the Council of the European Union certain liberal tendencies can be observed in the country, according to the words of Belarusian opposition politicians no real change happened. Political, civil and media circles are still facing the same massive repression and loosening of sanctions may, according to the opposition, lead to tightening of internal control over society resulted from the fear of colour revolution. During Lukashenko's government, sanctions against Belarus never led to effective regime changes, never extremely interfered with its functioning or personal freedoms of its members and were often lifted very soon. Another significant reason for their inefficiency is a weak connection between the Belarusian society and economy and the European Union – there is no sphere in which the sanctions could noticeably affect the Belarusian political top. On the other hand, this policy has helped the Lukashenko's regime to manoeuvre between the European Union and Russia. Although Belarus is economically dependent on Russia, there is an unceasing effort to retain some sovereignty in economic and foreign policy spheres. Especially after the annexation of the Crimea and the war in the Donbass, we can see Lukashenko's effort not to fall completely into the thrall of Putin's goals. This is evidenced by the refusal to recognise Crimea as part of the Russian Federation and the definitive cancellation of plans for the construction of air bases in Belarus territory in December 2015. Belarus also refused to join the Russian retaliatory sanctions against the European Union on imports of meat, fruit, vegetables and dairy products, which angered Moscow greatly.

In the context of these events, we must keep in mind that Belarus is still very much economically dependent on Russia, 40 percent of Belarusian exports go to Russia and 55 percent of imports are from Russia. We must also take into account complete energy dependence on Russian oil and natural gas. The level of inflation is 12 percent. Belarus is a member of the Customs Union since 2010 and shortly after joining this organisation, the Belarusian economy has seen significant economic growth thanks to the export of manufactured goods to Russia. However, soon after that, a visible decrease in competitiveness has started, not only against European goods but also against the Russian. Not even the project of the Eurasian Economic Union from August 2015 did not significantly restore the Belarusian economy. On the other hand, a strong impulse to seek new outlets for Belarusian products was a short-term ban on the import of Belarusian foodstuffs to Russia in 2014. Belarus tried to take advantage of recently imposed Russian sanctions on European foodstuffs and to export these goods to Russia under its own brand. Similarly, there was some concern over the suspension of exports of electronics from Belarus to Kaliningrad province. More unexpected and still very crucial failures force the regime to seek new and more reliable economic channels. The lifting of the European sanctions allows Minsk to draw finances from the European Investment Bank and the European Bank for Reconstruction and Development. In the long term, it offers hope for an influx of investments, technology and new projects.                           

In the past, none of the sanctions directly made the regime to significantly change its behaviour. The country's isolation and its connection to Russia limit an operational area of the EU. Together with the impacts of sanctions against Russia, Belarus is suffering considerable economic losses, which offers more space for EU's economic incentives that could be a very effective lever to loosening of the regime. It is expected that in the future the European Union will continue to try to exploit the economic weakness of Russia to deepen its relations with Minsk. But it will depend on the effectiveness of the sanctions against Russia, its state of the economy and development of the Belarusian-Russian relations. Developments in Ukraine also have a major impact on the situation which can serve as an example of how a cooperation with the EU may lead to an improvement of an economic situation in a post-Soviet country, or the other way around – to highlight its limited effect. In the framework of the expansion of relations with the EU we certainly cannot expect an establishment of democracy or a revolution similar to Maidan in Ukraine because it is a purely pragmatic and rational choice of the Lukashenko's regime. In the foreseeable future, Russia will remain the most important Belarussian partner with a strong capability to influence events in the country. However, if Moscow would not find a way to make its economy grow, improving trade relations between Belarus and the EU could in the long term definitely influence the politics as well.

About author: Roksolana Dryndak

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