Publication: Monitor Volume: 4 Issue: 72

Recent declarations of Slavic brotherhood and unity have not kept Moscow from putting the economic squeeze on Minsk.

Belarusan First Deputy Prime Minister Valery Kokorev announced last week that Russian exporters this year are insisting that the share of barter-financed Belarusan trade be kept to only 30 percent of the total. The remaining 70 percent has to be paid for in foreign exchange. (Russian agencies, April 8) This contrasts with 1997, when Belarus was able to barter for 90 percent of its Russian imports. Belarusan arrears for Russian energy imports had therefore reached $470 million at the start of April, $225 of which was owed to Russia’s Gazprom natural gas monopoly. Gazprom has responded by cutting exports to Belarus by some 30 percent, and has threatened to reduce them by 50 percent, should these arrears not be settled in full by April 15 (as seems most unlikely).

The squeeze also includes new restrictions on Belarusan exports introduced on March 31 by Russia’s State Customs Committee. Under these regulations a wide variety of Belarusan industrial exports must undergo a more demanding certification process to be conducted by newly established Russian customs posts on the Belarusan border. In addition, the Customs Committee is "strongly requesting" that Minsk come up with $40 million in unpaid customs duties, many of which date back to 1995. (Russian agencies, April 10)

While Russia’s tougher attitude can be traced in part to economic considerations, political factors also play a role. Belarusan President Alyaksandr Lukashenka admitted that the new restrictions on barter are sanctioned by a decree that someone in the Russian government managed to "slip past" President Boris Yeltsin. (Russian agencies, April 10) The upshot is that, as Kokorev put it, "the Belarusan government has exhausted virtually all possibilities for the favorable resolution of this problem by negotiations with the Russian side". (Russian agencies, April 8)

Moscow therefore seems determined to decisively settle in its favor the squabble between the two countries that broke out when Lukashenka blamed leading Russian officials for the collapse of the Belarusan currency last month. It remains to be seen whether these reductions in energy imports remain in force long enough to bring Lukashenka’s much-touted "economic miracle" to an abrupt end.

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