Moscow Carrying Out Economic Rather than Political Annexation of Belarus, Inozemtsev Says

Paul Goble

            Staunton, September 7 – Recognizing that Belarusians would be unlikely to vote for unification with Russia even if Vladimir Putin sent in a wave of “polite, little green men,” Moscow has decided to pursue the economic annexation of Belarus while allowing Minsk to keep the appearance of political sovereignty,” Vladislav Inozemtsev says.

            For that policy to work, the Russian economist says, “Russia will try to significantly increase its positions in the economy of Belarus while Lukashenka is still in office” and will use institutions like German Gref’s Sberbank to carry out the raid given that the Russian economy is increasingly state-owned and thus congruent with Belarus’ (snob.ru/entry/197479/).

            Moscow might have pursued a very different and Armenian-style approach in Belarus allowing Lukashenka to go had it not been for the Belarusian leader’s lobbyists in Moscow in the form of powerful economic groups which view Belarus’ largest enterprises as ripe for the picking.

            And the signal that this is what is going on was given by Lukashenka himself who amidst all the turmoil in the streets suddenly began talking about the economy as his prime concern: “Our main task, our main problem, our main concern,” he declared last week, “is the economy,” words directed less at the streets of Minsk than at the lobbyists in Moscow.

            For this scheme to work, Moscow needs Lukashenka to remain in power so that the financial arrangements can continue to be made in the informal way that have characterized most ties between the two countries. That doesn’t mean he will be kept forever but rather than Moscow will work to ensure that he doesn’t leave until it establishes economic control.

            According to Inozemtsev, “the Russian authorities are seeking to systematize their aspirations for those Belarusian shares which could be more valuable in the case of the collapse of his regime than the ballyhooed oil fields in Venezuela” where Moscow put in far more money than it could hope to extract.

            “Russia needs somehow to guarantee its investments in Belarus, but independent private business cannot have a great role in a country out of which local companies are fleeing.” Consequently, in the best hybrid tradition, Moscow is using a bank with ties to the Kremlin to secure the economic annexation of a country it can’t quite yet absorb politically.

            Those watching Belarusian developments have seldom focused on the way in which Moscow has been using its economic leverage in recent months, but Lukashenka’s words and the Kremlin’s actions suggest that what a Russian bank does in Belarus may be among the very best indicators of where Moscow is heading and when.