Year of realised possibilities
[b]The year of the Tiger is now over. The symbol directly refers to the global economy which once gave birth to the Asian and Latin American ‘tigers’. Sadly, last year, the global economy failed to truly recover, making only a few steps forwards. Anti-crisis measures have been planned by the EU, the USA and most other states. Fortunately, Belarus has avoided the recession. However, having an open economy, it is not immune to world trends. The President of Belarus, Alexander Lukashenko, outlined in his pre-election programme that Belarus needs a new image of its economy; it is the major goal for the coming five years [/b]Speaking about symbols, the lynx is often depicted on the old emblems of Belarusian towns. In heraldry, it denotes a sharp eye, an ability to see to the heart of the matter. Clearly, this is a skill which Belarusians would be wise to utilise, to take advantage of their current opportunities.
Speaking about symbols, the lynx is often depicted on the old emblems of Belarusian towns. In heraldry, it denotes a sharp eye, an ability to see to the heart of the matter. Clearly, this is a skill which Belarusians would be wise to utilise, to take advantage of their current opportunities.
“You’ve achieved so much,” stresses the Head of the IMF Mission, Chris Jarvis. “Belarus has avoided recession and renewed its economic growth which, from January to October, reached 6.8 percent. Belarus has also gained access to international capital markets, issuing Eurobonds; meanwhile, some success has been achieved in the field of structural reform. Amendments to the Law on Privatisation (a Decree by the National Investments and Privatisation Agency) have strengthened the legal and institutional basis for privatisation. We should also praise the initiatives of official bodies regarding the further liberalisation of the economy and entrepreneurial development. The focus is on the development of small and medium-sized enterprises.”
Generally, these words embody the essence of work achieved over the past year. The major result here is not that Belarus has escaped recession and economic depression; rather, people have remained upbeat about the future. Pessimism, social apathy and fear of change have been avoided. Structural reform and freedom of business have stepped forward into the breach. Franklin Roosevelt said, during the Great Depression, “Fear is the only thing we must be afraid of.”
Belarus has no fear of the rapidly changing world. In fact, the crisis has pushed us to see new possibilities, new partners and new sales markets. The country — boasting a strong, socially-oriented economy and historical roots — is ready to take a new, liberal step forward.
Belarus recently promoted itself at the Investment Forum in German Frankfurt, attracting the attention of potential investors, from Germany and elsewhere. Belarus aims to show itself as a unique site for investment, with a liberal economy and simplified taxation regime. We are also focusing on privatisation, ensuring legal guarantees for investors and many other structural reforms.
Talks with investors are being conducted in clear language, in the financial capital of continental Europe. However, this dialogue would be insufficient without clear political language. With this in mind, the past year has been characterised by a range of top level visits by EU representatives. This is a political passage which must be navigated to continue our advancement. I’ll detail the essence of talks with the EU later; now, let’s focus on partnerships.
Talking recently at a Minsk forum, famous Russian expert Prof. Alexander Pankrukhin, from the Russian State Service Academy, stressed, “Competitiveness is based on the ability to partner. Belarus boasts this mentality: the ideology of partnership, which is a progressive factor.” His opinion differs greatly from that of the idle speculations of the Russian media regarding Belarus’ multi-vector policy. Active promotion of our national interests in Europe is viewed by the Russian media as bargaining — either with Russia or the EU. However, international relations and geopolitics are not spheres where ‘facts are bought and rumours are sold’...
Looking at Belarus’ availability for partnership, we should note that, from the very first days of its independent existence, it declared a multi-vector policy. Moreover, Belarus has a strict national consensus regarding the equal importance of its two global partners: Russia and the EU. We are connected to Russia by hundreds of production and co-operation links, while being focused on its huge market. The EU — primarily, Germany — is our major source of advanced technologies.
Mikhail Delyagin, another famous Russian economist and politologist, the Director of the Institute of Globalisation Problems, is convinced that huge Russia shouldn’t stray from Belarus, Ukraine and Kazakhstan if it seeks normal development. Without its close ties with these countries and a joint sales market, Russia ‘won’t be able to sustain stability for long’.
Mr. Delyagin believes that, on assessing the efficiency of our economic ties, two approaches are possible: accounting (for enterprises’ efficiency) and public (assessing the value of ties for the country overall). He believes that relations between Russia and Belarus must be viewed from the public point of view, rather than accounting efficiency. However, in relations between Moscow and Minsk, the accounting approach has won. Mr. Delyagin explains, “The problem is that, in Russia, all actions are viewed from the view of accounting efficiency. Regarding public efficiency, Russia and Belarus have no problems. From the dominant accounting point, local problems remain potentially unsolved. This is why our countries have local conflicts. These shall continue, at least until Russia faces a system crisis.”
Belarus now realises that, at a certain moment, the Russian leaders have chosen another path in their relations with neighbours, seeking quick economic profit (necessary for oil and gas exporters). This is a mistake which the Russians must realise and resolve. In fact, a positive trend of change is already evident.
Minsk, in turn, won’t betray its national interests, continuing to realise new opportunities.
Last year, Belarus was officially visited by the President of Lithuania, Dalia Grybauskaitė, and the European Commissioner for Enlargement and Neighbourhood Policy, ¦tefan Fьle. Minsk was also visited by the foreign ministers of Germany and Poland: Guido Westerwelle and Radoslaw Sikorski. In turn, Alexander Lukashenko met the Italian Prime Minister, Silvio Berlusconi. Only the most superficial observer would call them ‘envoys of the West who are striving to attract Minsk’s attention after its quarrel with Moscow’. Sadly, this is another erroneous stereotype, stating that Europe’s activity in Belarus is related to a desire to separate it from Moscow. The concept of Belarus being a buffer, which circles Russia with a belt of independent states, is a view more commonly held by the USA than the EU — as confirmed by Brzezinski Jr. In his column in The New York Times, the son of Zbigniew — Jan Brzezinski — advised Mr. Obama not to ignore ‘the vision of a single, free and safe Europe’, with ‘possible membership of Ukraine and Georgia in NATO and the EU’.
It seems the EU has parted with its plans to accept new members. Rather, it has included Ukraine, Georgia and Belarus, alongside some other partners, into its Eastern Partnership programme. How is it possible to view this programme as a rival to Russia, when Russia itself has a more advanced and major co-operation programme with Brussels?
Speaking of the EU’s interest in its new Eastern neighbours, we should note that Belarus and the EU share 1,200km of common border, with interest in co-operation emerging on both sides. No wise thinking politician can ignore this.
After Ms. Grybauskaitė visited Minsk, she saw that Mr. Lukashenko guarantees Belarus’ independence; she personally noted it at a meeting with her country’s diplomats. The Lithuanian President also brought home a signed agreement on border movement, enabling our two states’ citizens to move more freely across the border regions. It affects about 600,000 Belarusians and almost 800,000 Lithuanians and is only the beginning. It is gaining momentum, with Belarus already ratifying border movement agreements with EU members Poland, Latvia and Lithuania. Closer ties are sure to develop on both sides of the border, bringing greater rapprochement between Belarus and the European Union.
Co-operation with the EU in the energy sphere is natural. Polish Foreign Minister Radoslaw Sikorski discussed not only free and democratic elections with Mr. Lukashenko during his visit to Minsk, but debated energy co-operation, speaking with his counterpart, Mr. Martynov. The German Minister, Guido Westerwelle, expressed his wish to see ‘a strong bridge built between Belarus and Europe, based on legislation, democracy and human rights’. Additionally, Mr. Westerwelle expressed our unity of economic interests. At the forum (organised in Berlin on the eve of his visit to Minsk by the Goethe Institute), he advocated the establishment of a single economic space for the EU and its Eastern neighbours. Political dialogue is a necessary condition for this collaboration, of course. Mr. Westerwelle explained that ‘in countries where human rights are met, investors feel good’. “Co-operation with the EU will benefit every Belarusian,” he asserts.
In November, the Federal Minister of Special Affairs and Chief of the Chancellor’s Office, Ronald Pofalla, visited Minsk to attend the forum Belarus and the EU After Crisis: Challenges and Opportunities in the Fields of Politics, Economics and Society. Interest between Belarus and the EU is mutual, with our country hoping to fully use European mechanisms of investment collaboration — especially from the European Investment Bank. In return, we offer participation in projects vital to the whole of Europe: logistical, transport and energy. Partnership offers new possibilities for Europe, as the EU now realises. Accordingly, it is ready to liaise more actively with Minsk.
The foundations were laid during the first meeting between Mr. Lukashenko and the former EU Commissioner for External Relations and European Neighbourhood Policy, Benita Ferrero-Waldner, in Minsk. The Belarusian President stressed his constant support of sincere policy and proposed ‘absolutely open and sincere talks’. Belarus is eager to build normal relations with the EU. Europe is our neighbour, while the EU accounts for half of our trade income. Mr. Lukashenko noted that the EU is technologically advanced while Belarus boasts a high-tech economy; with this in mind, the country needs co-operation with the EU to ensure its development. “What do we want from Europe? We want Europeans to understand that Belarus is not just the geographical centre of this continent. It is home to decent, frank and hard-working people. It is an independent sovereign state and we cannot allow anyone to infringe upon this, whoever might wish to,” he said.
Talking to Western journalists and politicians on what Belarus can offer Europe, Mr. Lukashenko notes that we not only boast a geographical position at the crossroads of transport routes, offering great transit possibilities, but can offer security. “We are a connecting link between the European Union and the Russian Federation,” he says. “Major oil and gas pipes pass through Belarus, in addition to roads and railways. Moreover, these are in very good condition — even better than those of our neighbours.”
According to the Head of State, Belarus has never been blamed by Europe for failing to ensure EU security. The country actively counteracts illegal migration, drug trafficking and the smuggling of radioactive materials, while having an absolutely stable situation, without national or inter-confessional conflict. The President believes ‘this creates a basis on which Belarus and the EU can build relations’.
Mr. Lukashenko noted the growing mutual interest of Belarus and the EU during his meeting with the Secretary-General of the EU Council, Javier Solana. This extremely influential European politician has finally set a new trend in Minsk-Brussels relations, which are steadily growing closer.
Besides being at the geographical centre of Europe, strengthening its connections with old democracies, Belarus has made a true breakthrough in its relations with the new global leaders. Its agreements with the heads of Brazil, Venezuela and China are a true sensation. Oil agreements signed in Caracas deserve particular attention. Our two states’ presidents agreed, this year, that Venezuela will supply 4m tonnes of oil to Belarus, with the figure set to rise to 10m in coming years. Taking into consideration the fact that Belarus imports 21.5m tonnes of oil from Russia, these 10m tonnes are influential. Diversification of energy suppliers allows an escape from energy dependence on a single state.
Thirteen contracts were signed with China during Mr. Lukashenko’s visit to Beijing in October: the result of many years of intense preparations. Belarusian enterprises began searching for Chinese partners several years ago, with the President’s official visit to China in 2005 serving as a starting point. It was then that mutual political understanding received a business flavour. In early 2010, the Chinese Vice President, Xi Jinping, visited Minsk; as a result of talks, a credit line was opened for Belarus: a record $15bn.
Of course, modern and competitive projects are needed and some have already been proposed, while others are being studied. Beijing is convinced that Belarusian projects offer serious profit; the production of microwave ovens at Minsk’s Horizont, construction of cement plants and reconstruction of Minsk’s heat power stations are among them. Future large-scale plans are known exclusively to specialists but it’s already clear that China, a strategic partner, presents an advantage to Belarus, enabling it to promote itself on the world market.
This year, Belarus decided to establish its own National Investment Agency — called by some politologists and economists ‘the national security agency’. Belarus needs a favourable environment for investments and innovations, developing entrepreneurship. Speaking to foreign journalists, Mr. Lukashenko admits that he is confident of the future, explaining, “If someone thinks that, tomorrow, Russian subsidies will depart, leaving us to crash, it’s untrue. We are standing on our own two feet.” According to him, Minsk is now diversifying its foreign policy, building partnerships with many countries around the world.
The recently adopted Belarusian concept of national security envisages a multi-vector policy, economic and energy diversification, and the development of fully-fledged relations with EU members. Another important result of 2010 has been the establishment of the Customs Union of Belarus, Kazakhstan and Russia and the gradual movement towards a Single Economic Space. From Minsk’s point of view, freedom of movement for goods, labour and capital must take priority. Belarus is the most western of non-Western states, being the gateway between two worlds.
By Nina Romanova
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