Publication: Monitor Volume: 5 Issue: 161

President Alyaksandr Lukashenka declared yesterday to the Minsk press that “economics, not politics, must form the basis of a future union treaty” between Russia and Belarus. Obliquely responding to Russian President Boris Yeltsin’s recent suggestion that such a treaty be signed at a special summit this autumn, Lukashenka called for starting negotiations on a “purely economic” section of the draft treaty of union. The Belarusan president proceeded to hint at some of his economic conditions for acceding to such a treaty. These would include:

–“Equal conditions,” not in words but in practice, for economic entities of either country on the territory of the other. The Russian Federation must introduce such conditions for Belarusan firms in Russian law, Lukashenka insisted yesterday. From recent statements by Lukashenka and other Belarusan officials, it is clear that the “equal conditions” would include duty-free access of Belarusan products to the Russian market, equal transport tariffs on Russian territory for Belarusan and for Russian goods, oil and gas deliveries to Belarus at Russian internal prices, and Russian writeoffs of Belarusan debt.

–Additional sweeteners such as licensing of certain “advanced” Russian industrial items for production or assembly in Belarus. Lukashenka wants, among other things, production lines for military and civilian airplanes and for dual-use electronics equipment.

–The Belarusan president, moreover, seems to be soliciting his ministries to submit specific requests for Russian bailouts. The Defense Ministry last week submitted a proposal to equalize Belarusan military pay and benefits with the corresponding Russian entitlements, thereby–according to the ministry–more than doubling the entitlements of Belarusan servicemen. Significantly, Minsk cited existing Russian-Belarusan agreements on legislative unification and equalization of social guarantees of the two countries’ citizens as the basis for the Belarusan Defense Ministry’s proposal.

The “equal conditions for economic entities” and the “equalization of citizens’ social guarantees” have been stipulated in a series of bilateral agreements over the last two years. Those agreements, however, have been proven purely declarative, while negotiations have focused on political unification. Lukashenka and his top aides have in recent days urged Russia to focus on economics and to avoid “the accountant’s approach to relations with Belarus”–a thinly veiled demand for Russian economic subsidies as part of the relationship. Meanwhile, Lukashenka’s interpretation of the equal conditions rules out any preferential terms for Russian capital investment in Belarus. Moreover, the president’s doctrinal resistance to privatization forms an insuperable barrier to takeovers of Belarusan industrial plants and energy infrastructure by Russian capital (Itar-Tass, ORT, Radio Minsk, Belapan, August 23-September 1).