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

DRC Tries Mega-Farms to Feed Population

Park at Boukanga Lonzo currently has 5,000 hectares under cultivation, crops stretching as far as eye can see, and is start of ambitious large-scale agriculture plan More

Video Survivor Video Testimonies Recount Horrors of Guatemalan Genocide

During a conflict that spanned more than three decades, tens of thousands of indigenous Mayans were killed More

Video War, Drought Threaten Iraq's Marshlands

Areas are spawning ground for Gulf fisheries, a resting place for migrating wildfowl, source of livelihood for fishermen and herders who have called the marshes home for generations 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.
Nobel Prize Winner Malala Talks to VOAi
X
August 31, 2015 2:17 AM
Nobel Peace Prize winner Malala Yousafzai met with VOA's Deewa service in Washington Sunday to talk about women’s rights and unveil a trailer for her new documentary. VOA's Katherine Gypson has more.
Video

Video Nobel Prize Winner Malala Talks to VOA

Nobel Peace Prize winner Malala Yousafzai met with VOA's Deewa service in Washington Sunday to talk about women’s rights and unveil a trailer for her new documentary. VOA's Katherine Gypson has more.
Video

Video War, Drought Threaten Iraq's Marshlands

Iraq's southern wetlands are in crisis. These areas are the spawning ground for Gulf fisheries, a resting place for migrating wildfowl, and source of livelihood for fishermen and herders. Faith Lapidus has more.
Video

Video Colombians Flee Venezuela as Border Crisis Escalates

Hundreds of Colombians have fled Venezuela since last week, amid an escalating border crisis between the two countries. Last week, Venezuelan President Nicolas Maduro ordered the closure of a key border crossing after smugglers injured three Venezuelan soldiers and a civilian. The president also ordered the deportation of Colombians who are in Venezuela illegally. Zlatica Hoke reports.
Video

Video Rebuilding New Orleans' Music Scene

Ten years after Hurricane Katrina inundated New Orleans, threatening to wash away its vibrant musical heritage along with its neighborhoods, the beat goes on. As Bronwyn Benito and Faith Lapidus report, a Musicians' Village is preserving the city's unique sound.
Video

Video In Russia, Auto Industry in Tailspin

Industry insiders say country relies too heavily on imports as inflation cuts too many consumers out of the market. Daniel Schearf has more from Moscow.
Video

Video Scientist Calls Use of Fetal Tissue in Medical Research Essential

An anti-abortion group responsible for secret recordings of workers at a women's health care organization claims the workers shown are offering baby parts for sale, a charge the organization strongly denies. While the selling of fetal tissue is against the law in the United States, abortion and the use of donated fetal tissue for medical research are both legal. VOA’s Julie Taboh reports.
Video

Video Next to Iran, Climate at Forefront of Obama Agenda

President Barack Obama this week announced new initiatives aimed at making it easier for Americans to access renewable energy sources such as solar and wind. Obama is not slowing down when it comes to pushing through climate change measures, an issue he says is the greatest threat to the country’s national security. VOA correspondent Aru Pande has more from the White House.
Video

Video Arctic Draws International Competition for Oil

A new geopolitical “Great Game” is underway in earth’s northernmost region, the Arctic, where Russia has claimed a large area for resource development and President Barack Obama recently approved Shell Oil Company’s test-drilling project in an area under U.S. control. Greg Flakus reports.
Video

Video Philippine Maritime Police: Chinese Fishermen a Threat to Country’s Security

China and the Philippines both claim maritime rights in the South China Sea.  That includes the right to fish in those waters. Jason Strother reports on how the Philippines is catching Chinese nationals it says are illegal poachers. He has the story from Palawan province.
Video

Video China's Spratly Island Building Said to Light Up the Night 'Like A City'

Southeast Asian countries claim China has illegally seized territory in the Spratly islands. It is especially a concern for a Philippine mayor who says Beijing is occupying parts of his municipality. Jason Strother reports from the capital of Palawan province, Puerto Princesa.
Video

Video Ages-old Ice Reveals Secrets of Climate Change

Ice caps don't just exist at the world's poles. There are also tropical ice caps, and the largest sits atop the Peruvian Andes - but it is melting, quickly, and may be gone within the next 20 years. George Putic reports scientists are now rushing to take samples to get at the valuable information about climate change locked in the ice.

VOA Blogs