The Eurasian Stabilisation and Development Fund’s new loan programme for Belarus has boosted Minsk’s interest in other sources of financial support. The ESDF loan of $2.1bn (against $3bn requested earlier) is enough to restructure Belarusian state debt to the Russian Government and other Russian creditors. As a condition for receiving the loan Minsk has consented to a programme of dynamic economic reform (details yet to be announced). The latter largely coincides with the requirements set forth by the International Monetary Fund and other institutions for their respective financial assistance programmes. Thus, the Russia-backed loan dramatically decreases political risks of implementing Western institutions’ recommendations and paves the way for Belarus’ enhanced co-operation with Western creditors.
At the meeting Alexander Lukashenko outlined investment, financial, trade-economic co-operation and mobility partnership as priorities for Belarus-EU relations. Moreover, Belarus and the EU will continue to work on a still absent comprehensive bilateral agreement to create a legal framework for the two parties’ cooperation.
Talking to journalists after the meeting, the Minister for Foreign Affairs, Vladimir Makei, called for enhanced bilateral co-operation across all spheres, marking the importance of taking advantage of the ‘window of opportunity’ that has opened up for Belarus and EU.
Comments have already appeared regarding expected benefits from further rapprochement. They allegedly include multi-hundred million Euro loans from the European Investment Bank, as well as a wider country mandate by the European Bank for Reconstruction and Development, EU support for Belarus’ bid for the IMF loan, and removal of quotas on Belarusian textile exports to the European market.
This economic support is of strategic significance at this time of crisis in Belarus. Meanwhile, the meeting at the President’s office was preceded by the signing of a major contract between Belarusian Gomelsteklo JSC and German Schollglas GmbH, that will significantly increase sales to Germany.
Future strategic agreements between Belarus and EU institutions are creating foundations for further bilateral rapprochement compatible with Belarus’ obligations under the Eurasian Economic Union and other integration frameworks. At the April 5th meeting, the Belarusian leader hailed the robust approach of the EU and US regarding Belarus, which is avoiding pressure on Minsk to choose between co-operation with Russia and the West.
The Belarusian leader also noted co-operation with China as vital foreign policy vector. It is worth saying that the development of Belarus-EU relations is a source of potential benefit to Belarus-China co-operation. Beijing’s plans in Belarus, including the construction of the Great Stone Industrial Park (potentially the largest Chinese project in Europe), aim to promote not only China-EEU relations, but China-EU trade and investment co-operation.
If Belarus reaches its desired goals regarding Belarus-EU and Belarus-China relations, while preserving its strategic partnership with Russia, it should create a unique opportunity for the country’s development and prosperity.
Yuri Tsarik,
Center for Strategic and Foreign Policy Studies
