News / Europe

Belarus Goes Bankrupt Without Any Savior in Sight

Belarus' President Alexander Lukashenko speaks at Victory Square in Minsk to celebrate the 66th anniversary of the World War II victory over Nazi Germany, May 9, 2011
Belarus' President Alexander Lukashenko speaks at Victory Square in Minsk to celebrate the 66th anniversary of the World War II victory over Nazi Germany, May 9, 2011
James Brooke

Belarus is emerging as the Greece of the Slavic world. Flirting with bankruptcy, Belarus has seen the value of its ruble plummet - from 3,000 to the dollar a few weeks ago to 6,500 today.

But in a big difference with Greece, no one - not the West, not Russia, not the International Monetary Fund - is running to help. Neighboring leaders cite the eccentric and often harsh leadership of the country's president of 17 years, Alexander Lukashenko.

In a typical move, Lukashenko told his Cabinet on Tuesday that Russia is preparing to loan Belarus $6 billion.

Within one hour, Russia’s Interfax news agency ran a story citing Kremlin sources saying that Russia is not going to loan any money to Belarus. In reality, these sources say, Russian Prime Minister Vladimir Putin will visit Minsk on Thursday and offer to pay $1 billion to win total control of Belarus’ gas pipeline system.

Jana Kobzova is Belarus analyst for the European Council on Foreign Relations. On a visit to Moscow this week, she finds Russians highly wary of Belarus.

“Everybody is fed up with Belarus," said Kobzova. "They just think they have been sucking up resources far too long.”

Putin estimates that Russia has been subsidizing Belarus to the tune of $5 billion a year. Last year, that was 10 percent of the gross domestic product [GDP] of this Central European nation of 9 million people.

By turning off subsidies this year, Moscow is pushing Minsk into the kind of traumatic shift from a state economy that Russia went through after the collapse of communism.  

Anton Struchenevsky, economist for Russian investment house Troika Dialog, sees clear similarities.

"What is happening currently in Belarus is very close to the process which was observed in Russia before the collapse of the Soviet Union in 1991," said Struchenevsky. "The economy is at the beginning of very dramatic changes.”

Imported goods are disappearing from store shelves. Shortages of imported parts are stopping assembly lines, forcing factories to lay off hundreds of thousands of workers. And thousands of Belarussians stand in lines outside exchange kiosks trying to unload their local rubles before they become even more worthless.

Struchenevsky calculates that, in nominal terms, Belarus incomes are going to drop by half this year, hitting $3,000 a year - the level of Ukraine.

“GDP in nominal terms should shrink by two times,” he said.

With the economy collapsing, the rating agency Standard and Poors last week placed Belarus on the same level of creditworthiness as Greece.

In a big difference, though, European Union finance ministers recently agreed to a $147-billion bailout for Greece, a democracy with a population only slightly larger than Belarus.

But Lukashenko can expect little from the West. He is one of the few leaders in the world today to openly mock democracy.

In recent days, Belarus prosecutors have put on trial five former presidential candidates. On Saturday, a Minsk judge imposed a five-year sentence on Andrei Sannikov, the leading opposition candidate in last December’s presidential elections. A sixth candidate escaped to the Czech Republic, where he charged that he was tortured in jail in Minsk.

So far 30 dissidents have been tried and convicted this year, with 22 receiving jail terms. Last week, the United States blasted the trials, calling for the release of all political prisoners.

EU foreign ministers also have condemned the trials.

Symptomatic of the hardening of attitudes is the reaction of Guido Westerwelle, foreign minister of Germany. Last fall, Westerwelle met with Lukashenko in Minsk and offered billions of dollars in financial aid, if Belarus held free and fair elections.

On Monday, the German foreign minister condemned the trial and conviction of Sannikov, saying, "In this trial, justice has not been served.  It is the political will of Lukashenko that was executed."

He demanded the freedom of all of Belarus’ political prisoners.

Next week, EU foreign ministers are to meet to debate tightening sanctions against leaders of the repression in Belarus.

Even without sanctions, the markets already are isolating Belarus.

On Monday, Jan Kulczyk, a Polish billionaire, suspended a plan to build a $2-billion coal-fired power plant in Belarus. He said he could not do the project without bank financing, but no bank would offer money for a major project in Belarus today.

You May Like

Missouri Town Braces for Possible Racial Unrest

Situation in Ferguson hinges on whether white police officer will be indicted for August shooting death of unarmed black teen; decision could come Monday More

Video Ukraine Marks Anniversary of 1930s Deadly Famine

President Poroshenko compares Soviet-era ‘genocide’ to current tactics of pro-Russia rebels in Ukraine's east More

S. Philippines Convictions Elusive 5 Years After Election-related Killings

Officials vowed to deliver justice as the nation marked the anniversary of the country's worst political massacre that left 58 dead, more than half media More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
New Skateboard Defies Gravityi
X
November 21, 2014 5:07 AM
A futuristic dream only a couple of decades ago, the hoverboard – a skateboard that floats above the ground - has finally been made possible. While still not ready for mass production, it promises to become a cool mode of transport... at least over some surfaces. VOA’s George Putic reports.
Video

Video New Skateboard Defies Gravity

A futuristic dream only a couple of decades ago, the hoverboard – a skateboard that floats above the ground - has finally been made possible. While still not ready for mass production, it promises to become a cool mode of transport... at least over some surfaces. VOA’s George Putic reports.
Video

Video Falling Gas Prices Impact US Oil Extraction

With the price of oil now less than $80 a barrel, motorists throughout the United States are benefiting from gas prices below $3 a gallon. But as VOA’s Kane Farabaugh reports, the decreasing price of petroleum has a downside for the hydraulic fracturing industry in the United States.
Video

Video Tensions Build on Korean Peninsula Amid Military Drills

It has been another tense week on the Korean peninsula as Pyongyang threatened to again test nuclear weapons while the U.S. and South Korean forces held joint military exercises in a show of force. VOA’s Brian Padden reports from the Kunsan Air Base in South Korea.
Video

Video Mama Sarah Obama Honored at UN Women’s Entrepreneurship Day

President Barack Obama's step-grandmother is in the United States to raise money to build a $12 million school and hospital center in Kogelo, Kenya, the birthplace of the president's father, Barack Obama, Sr. She was honored for her decades of work to aid poor Kenyans at a Women's Entrepreneurship Day at the United Nations.
Video

Video Gay Evangelicals Argue That Bible Does Not Condemn Homosexuality

More than 30 U.S. states now recognize same-sex marriages, and an increasing number of mainline American churches are blessing them. But evangelical church members- which account for around 30 percent of the U.S. adult population - believe the Bible unequivocally condemns homosexuality. VOA's Jerome Socolovsky reports that gay, lesbian, bisexual and transgender evangelicals are coming out. Backed by a prominent evangelical scholar, they argue that the traditional reading of the bible is wrong.
Video

Video Ebola Economic Toll Stirs W. Africa Food Security Concerns

The World Bank said Wednesday that it expects the economic impact of the Ebola outbreak on the sub-Saharan economy to cost somewhere betweenf $3 billion to $4 billion - well below a previously-outlined worst-case scenario of $32 billion. Some economists, however, paint a gloomier picture - warning that the disruption to regional markets and trading is considerable. Henry Ridgwell reports from London.
Video

Video Mexico Protests Escalate Over Disappearances

Protests in Mexico over 43 students missing since September continue to escalate, reflecting growing anger among Mexicans about a political system they view as corrupt, and increasingly tainted by the drug trade. Mounting outrage over the disappearances is now focused on the government of President Enrique Pena Nieto, accused of not doing enough to end insecurity in the country. More from VOA's Victoria Macchi.
Video

Video US Senate Votes Down Controversial Oil Pipeline - For Now

The U.S. Senate has rejected construction of a controversial pipeline to transport Canadian oil to American refineries. The $5 billion project still could be approved next year, but it faces a possible veto by President Barack Obama. As VOA’s Michael Bowman reports, the pipeline has exposed deep divisions in Congress about America’s energy future.
Video

Video Can Minsk Cease-fire Agreement Hold?

Growing tensions between government troops and separatists in eastern Ukraine further threaten a cease-fire agreement reached two months ago in the Belarusian capital of Minsk. Critics of U.S. policy in Ukraine say it is time the Obama administration gives up on that much-violated cease-fire and moves toward a new deal with Russia. VOA's Scott Stearns has more.
Video

Video Chaos, Abuse Defy Solution in Libya

The political and security crisis in Libya is deepening, with competing governments and, according to Amnesty International, widespread human rights violations committed with impunity. VOA’s Al Pessin reports from London.
Video

Video US Hosts Record 866,000 Foreign Students

Close to 900,000 international students are studying at American universities and colleges, more than ever before. About half of them come from Asia, mostly China. The United States hosts more foreign students than any other country in the world, and its foreign student population is steadily growing. Zlatica Hoke reports.
Video

Video Ferguson Church Grapples with Race Relations

Many white residents of Ferguson, Missouri, say they chose to live there because of the American Midwest community's diversity. So, they were shocked when a white police officer killed an unarmed black teenager in August – and shaken by the resulting protests and violence. Some local churches are leading conversations on how to go forward. VOA’s Ayesha Tanzeem reports.

All About America

AppleAndroid