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Will Russia Snatch Up Belarusian Industrial Assets Amid Crisis?

Rogue Valley

Putin = War Criminal
DP Veteran
Apr 18, 2013
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Will Russia Snatch Up Belarusian Industrial Assets Amid Crisis?


With Belarus facing a shaky future after a disputed election sparked a wave of protests and a brutal crackdown by authoritarian President Alyaksandr Lukashenka’s government, Russia appears eager to keep the smaller country, a longtime ally, firmly in its orbit. But the spoils of tighter control, if Moscow manages to achieve it, could also include industrial assets in Belarus, whose Soviet-style economy has long been propped up with Russian subsidies to a country the Kremlin sees as a buffer bordering NATO and the European Union. In their first face-to-face talks since the August 9 election which Lukashenka claimed to win a sixth term by a landslide amid opposition assertions of widespread fraud, Putin promised him a $1.5 billion lifeline in the form of a loan. Whether Lukashenka promised anything specific in return is not publicly known, but Lukashenka’s opponents fear he may cede sovereignty in exchange for Russian support, and analysts have said Moscow may have its eye on a handful of Belarusian companies. “Everyone is paying attention…to the $1.5 billion, but it’s worth noting what we did not learn” about the content and results of the September 14 talks in the Russian Black Sea resort city of Sochi,” said Leu Lvouski, a senior researcher at the Minsk-based Belarusian Economic Research and Educational Center (BEROC).

If pressed by Putin, Lukashenka would have little choice, given the Belarusian economy’s “addiction” to Russian energy and capital, Lvouski told Current Time, the Russian-language channel led by RFE/RL in cooperation with VOA. “For a long time, we were able to mask the inefficiencies in our economy through various subsidies, through the import of Russian oil into Belarus at a reduced price, and thus this surplus could go into the Belarusian budget,” Lvouski said. “Many Belarusian banks have Russian capital. So, of course, the addiction is pretty serious.” However, some analysts say many Belarusian firms are not exactly attractive. “The economic performance of most of these enterprises is quite poor, so they have significant debts and are permanently subsidized by the government,” said Hanna Baraban, a Belarusian journalist and analyst. “It helps them to survive, but this money is not enough for the proper upgrade of the facilities -- that is why many enterprises still use old technologies made in the Soviet Union,” she explained to RFE/RL in e-mailed remarks. Whether Lukashenka has made any firm commitment so far to Putin on the sale of any Belarusian state firms is unclear. But if such a deal is eventually done, it will likely be a short-term solution for the embattled Lukashenka, said Lvouski. He added, however, that any sale to Russia will not sit well with Belarusians already angry with Putin’s role in the crisis so far.

Lukashenka has already lost support from the vast majority of Belarusians. Putin also realizes that he will lose the meager support he has in Belarus as he wrests more concessions from Lukashenka.

Belarusians highly value their own national identity and do not want to be a part of Russia.
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