Friday, November 14, 2014

Window on Eurasia: Moscow May No Longer Have the Money to Prop Up Lukashenka, Russian Experts Say

Paul Goble


            Staunton, November 14 – As a result of its economic crisis which has been exacerbated by Western sanctions and Moscow’s own counter-sanctions, the Russian government no longer has the funds it once did to provide assistance to and thus ensure the complete loyalty of its closest ally, Belarusian leader Alyaksandr Lukashenka.


            That is the conclusion of a new study by development economists at Moscow’s Higher School of Economics, one that is prompting discussions among Belarusian opposition groups and that is certainly generating concern in Mensk and Moscow alike (, and


“A few extra billion dollars for supporting its closest ally in the past did not represent any particular difficulty for Russia,” the report concluded in the words of “But today, when access by Russian businesses to international capital markets is limited and oil prices are falling, Moscow will begin to reflect on the cost of this support.”


The Russian report examines the various ways in which the recent changes in the Russian economic environment has affected Belarus. Lower oil prices have helped Belarus in one way – Mensk doesn’t have to pay as much as it did – but they have reduced Russian demand for Belarusian products and thus hurt it much more.


In addition, the report concludes, the problems in the Russian banking system are spreading to Belarus as well. And together these things are pushing down growth in that country just as they are doing in the Russian Federation.  That may force Mensk to look elsewhere for funding, including the IMF.


            It would be one of the great ironies if the greatest impact of Western sanctions was not on Russia itself but on Belarus and its leader, someone routinely described as “the last dictator in Europe.” They might lead him to become even more repressive in order to hold onto power, but there are other possibilities as well.


            Lukashenka, if he loses his Russian support, may decide that his future lies not with the repressive policies of the Putin international of dictators but rather with the West and try to change course at home and abroad. Lukashenka is an unlikely candidate as a reformer, but if Moscow has no funds, he may have no choice.


            At the very least, this unintended consequence of sanctions may liven up Belarusian politics and put Mensk in play geopolitically far sooner than anyone up to now has predicted.

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