Series:OSW Commentary

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The CSDP’s renaissance. Challenges and opportunities for the eastern flank

The CSDP’s renaissance. Challenges and opportunities for the eastern flank

Author(s): Justyna Gotkowska / Language(s): English

Keywords: CSDP; eastern flank; EU foreign policy

On 22 June the European Council agreed on the need to launch a permanent structured cooperation (PESCO) in the field of security and defence. Thus, the last of the discussed initiatives on the development of the EU’s Common Security and Defence Policy (CSDP) gained political support and will be implemented. Debates on the CSDP have gained momentum since mid-2016 due to a combination of three factors: the UK’s decision to leave the EU, the adoption of the Global Strategy for the EU’s Foreign and Security Policy, and some EU member states’ dislike of Donald Trump, combined with the conviction that it is necessary to reduce the EU’s dependence on the USA. The year-long negotiations have resulted in the creation of military planning and conduct capability, the establishment of the European Defence Fund, and of the coordinated annual review on defence, and the decision to activate PESCO.These initiatives may be an opportunity to increase the military capabilities of EU member states and to boost investment or streamline defence spending. However, in an unfavourable political situation (involving for example long-term tensions between the USA and the Western European allies), the development of these initiatives may have negative consequences for NATO. Therefore, in most states of the Baltic Sea and the Black Sea regions, EU initiatives are received with great caution. Less inclined to see themselves as part of the eastern flank, Poland’s partners from the Visegrad Group are more enthusiastic about the plan to enhance cooperation. However, it is not certain whether the new EU initiatives will bring measurable results or if they will remain a rather meaningless response to a short-term political demand.

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The improving economic situation in Russia: reality or creative statistics?

The improving economic situation in Russia: reality or creative statistics?

Author(s): Iwona Wiśniewska / Language(s): English

Keywords: Russia; economic policy

The indicators published in recent months by the Russian Statistics Office (Rosstat) are much more optimistic than the estimates and forecasts announced several months earlier. A significant improvement in statistical data is evident in particular regarding the figures for GDP and industrial production. According to new information, over the last two years (2015-2016) the Russian economy shrank by 3%, and not by 4.5% as previously estimated. Moreover, data compiled by Rosstat show an increase in industrial production was registered, even in the face of a decline in citizens’ income and fixed investment. In addition, the slowdown in the industrial sector was found to have ended at the beginning of 2016 and not at the end of 2016 as previously reported.The improvement of economic indicators can undoubtedly be attributed to certain objective factors, including taking into account more detailed data or a change in methodology, which is a natural element of the process of compiling statistical data. However, the scale of the change and the lack of professionalism on the part of Rosstat, including the manner of presenting the data, its failure to observe the deadlines for issuing publications and selective inclusion of data, undermine the credibility of the presented figures. Therefore, increasing caution is advised when interpreting these data. Doubts regarding the quality of the indicators presented by Rosstat make the assessment of Russia’s actual economic situation increasingly difficult. As a consequence, reservations towards the Russian statistics office seem to be all the more justified. These suggest that Rosstat is under political pressure from the Kremlin and that these new, improved statistics meet the government’s propaganda-motivated demand for information. Ahead of the upcoming presidential election planned for March 2018, the government would like to emphasise its effectiveness, such as by efficiently overcoming the crisis and stabilising the economic situation in Russia.

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The Amber Rush in Ukraine

The Amber Rush in Ukraine

Author(s): Tomasz Piechal / Language(s): English

Keywords: Amber Rush; Ukraine

Illegal amber mining in Ukraine has intensified since the Revolution of dignity. The practice has progressed at an unprecedented rate and has contributed to the degradation of vast swathes of forests in areas where there are deposits of amber, mainly in the north-western part of the country (Polesia). Ukraine has the world’s second largest deposits of amber in terms of amount, following the Kaliningrad area. As little as approximately 4 tonnes are legally mined each year, whereas 150-200 tonnes are extracted illegally and over several thousand people are involved in this practice. According to the Ukrainian government’s calculations, the state may be losing up to US$ 200-300 million a year. Conflicts over control of the deposits have led to regular clashes between particular groups involved in illegal amber mining; the state is unable (or does not want) to take control of the part of the country which is rich in amber. Illegal amber mining has been accompanied by wide-scale corruption, close links between criminal groups and local governments and the lack of will to remedy the situation in the region on the part of the Ukrainian government. Illegal amber mining, even though it is a niche practice, may serve as a case for wider reflection on many serious ailments in the functioning of the Ukrainian state.

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Central Asia: the crisis of the migration model and its potential impact on the EU

Central Asia: the crisis of the migration model and its potential impact on the EU

Author(s): Józef Lang / Language(s): English

Keywords: Central Asia; migration; EU

Over the past fifteen years, the presence in Russia of several million labour migrants from Central Asia has been a key determinant of the region’s stability. This migration has contributed to reducing internal problems and has helped provide a source of income to societies in specific countries. At present, due to the economic crisis, Russia is unable to continue its involvement in relieving socio-economic tensions in the region. Remittances from migrants have declined by 50% over the last three years. Undeveloped Central Asian economies are unable to offer an alternative to labour migration and other states which migrants previously chose as destination, such as Kazakhstan, Turkey and China, are not in a position to replace Russia in this respect. Potentially, this generates the risk of a destabilisation of the socio-political situation in the most vulnerable countries of the region and may trigger a flow of migration from Central Asia to countries other than these three countries, including to the EU. This latter phenomenon has already occurred on a limited scale in Tajikistan, the state which most depends on labour migration. Over the last two years, there has been a rapid, more than five-fold increase in the number of citizens of this country who have applied for asylum in the EU. Even if large-scale migration pressure from Central Asia to the EU is unlikely, an increase in the number of migrants from Central Asia to the EU is conceivable. Due to the fact that Russia is a key transit route, Moscow may use this as an instrument of pressure towards the EU, especially the Central and Eastern European states which, in turn, would be more dangerous than the migration pressure itself.

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Ukrainian politics: the balance of forces after three years of war

Ukrainian politics: the balance of forces after three years of war

Author(s): Tadeusz A. Olszański / Language(s): English

Keywords: Ukrainian politics; war; international relations

The political situation in Ukraine is determined primarily by the ongoing war, and the situation of stalemate at the front is raising the level of public impatience. President Petro Poroshenko has consolidated the overwhelming majority of power in his hands, but he is not using it to fulfil his election promises; rather he is focused on strengthening his position. The significant weakening of the People's Front, the coalition partner of the Petro Poroshenko Bloc, as well as the majority of opposition parties has contributed significantly to this state of affairs. Prime Minister Volodymyr Hroysman remains dependent on the head of state, although he has gradually been strengthening his own political position. This has been accompanied by an increase in the importance of the Presidential Administration and the apparatus of the state, whose staff follow the President’s lead. We may also note a rise in the importance of the interior minister Arsen Avakov, who is also building up his own political position while remaining in the shadows. The political determination of the organisations of veterans of the war in Donbas is also noticeable, as is that of the nationalists. Moreover, preparations for the 2019 presidential and parliamentary elections are becoming increasingly important The president’s team are primarily focused on preventing the emergence of any new significant political forces which could threaten the balance of power created after the Revolution of Dignity. It seems that there will be no dissolution of the parliament or change of government in the coming months, a factor which will deepen the present stagnation of the process of reforming the country.

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The stable crisis. Ukraine’s economy three years after the Euromaidan

The stable crisis. Ukraine’s economy three years after the Euromaidan

Author(s): Tadeusz Iwański / Language(s): English

Keywords: Euromaidan; Ukraine

The economic statistics for 2016 indicate that Ukraine has managed to overcome the toughest phase of the economic crisis. For the first time in four years, the Ukrainian economy recorded a positive growth rate of around 2%[1]. This is due to the reforms launched in the first months following the EuroMaidan and of the implementation of the reconstruction programme under pressure from Western lenders, mainly the International Monetary Fund (IMF) and the EU. In addition, the favourable situation on global commodity markets and the drop in the price of energy resources, as well as good weather conditions which enabled record high grain harvest and an all-time-high export of grains, have had a positive impact on the Ukrainian economy. Economic growth has accompanied the stabilisation of the macroeconomic situation, which manifests itself, for example, in halting the slide in the hryvnia in concert with the gradual replenishment of foreign exchange reserves, the favourable balancing of budgetary revenues and spending (the deficit of around 3% GDP), maintaining the expected level of inflation and the improvement of the situation in the banking sector.

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Illusions of power and stark realities: The second year of the economic crisis in Belarus

Illusions of power and stark realities: The second year of the economic crisis in Belarus

Author(s): Kamil Kłysiński / Language(s): English

Keywords: Belarus; economic crisis

In 2016 the basic macroeconomic indicators of the Belarusian economy clearly proved that the Belarusian government failed to reverse the negative trends which occurred in 2015. The gap in the foreign trade balance grew, industrial production dwindled, foreign debt increased and the low foreign-exchange reserves continued. GDP fell for the second consecutive year and so it can already be stated that a long-term economic recession is setting in.The crisis has been caused by the failing, outdated model of the Belarusian economy. The country’s difficult economic situation was also influenced by external factors such as a substantial fall in the amount of Russian oil supplied at preferential prices to Belarusian refineries and an economic downturn in the world’s potassium-based fertilisers, which significantly reduced the profits from sales of Belarus’s most profitable exports. The Belarusian government, probably due to pressure from the long-standing crisis, has increasingly been referring in its rhetoric to the chances of improving the situation due to the development of innovative sectors (e.g. IT) and to the expansion of the freedom of operation of small and medium-sized enterprises. However, this has not translated into real reforms, even those limited to selected economic sectors. President Alyaksandr Lukashenka still fears he will lose full control of the Belarusian economy and is trying to maintain heavy industry based on large-scale production plants and dependent on supplies of natural resources from Russia and access to the Russian market. The Belarusian government is thus blocking the development of an economy based on strong foundations of economic growth which would be independent of external factors. In autumn of 2016 there was an unprecedented escalation of tensions between Minsk and Moscow which has yet to ease off. In this context, it should be expected that the crisis will continue in 2017 and the risk of an economic recession in Belarus will increase.

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The Turkish campaign in Germany. Rising tensions between Berlin and Ankara

The Turkish campaign in Germany. Rising tensions between Berlin and Ankara

Author(s): Kamil Frymark / Language(s): English

Keywords: Turkey; Germany; international relations

The influx of migrants to Germany and the conclusion of an agreement between the European Union and Turkey intended at stopping migrants from coming to the EU have shown that Germany’s internal policy is being increasingly influenced by decisions made by the Turkish government. The agreement might have introduced new dynamics to German-Turkish relations and brought about closer co-operation between the two countries but the situation became seriously complicated following a failed coup d’état in Turkey in July 2016 and President Erdogan’s response to it. Mass arrests and repression in Turkey are seen in Germany as an instrument of consolidation of Erdogan’s power, which is increasingly morphing into an oppressive authoritarian regime. Turkey’s plan to change the country’s constitution and to hold a referendum on it is perceived in this context.The three million-strong Turkish diaspora in Germany, of whom nearly a half have the right to vote, makes bilateral relations between the two countries important. Campaigns ahead of subsequent elections in Turkey increasingly lead to the transferral of Turkey’s internal conflicts to Germany and spark tensions between Berlin and Ankara. Recently, the dispute has grown fiercer because of a referendum campaign in Turkey which Turkish politicians are also running in Germany. As for Germany, the Bundestag election campaign has begun and public opinion is calling on the government to take firm action and to condemn the political purges in Turkey, which have also extended to those with dual German-Turkish citizenship. Chancellor Merkel has been forced to act with more determination towards Turkey while seeking an agreement regarding migration issues, security policy and the fight against terrorism. Her task will be made more difficult not only due to the Turkish government’s confrontational attitude but also due to pressure from the Social Democrats and opposition parties in Germany.

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AfD – the alternative for whom?

AfD – the alternative for whom?

Author(s): Artur Ciechanowicz / Language(s): English

Keywords: AfD; Germany

When in 2013 a group of professors of economics founded Alternative for Germany (Alternative für Deutschland – AfD) it seemed that the name of the new grouping was exaggerated. Taking into account its slogans and its leaders, the AfD could at that time be an alternative for disenchanted voters of the CDU/CSU and the FDP alone. The party’s ‘founding fathers’, among whom there was a large group of former CDU members, did not conceal the fact that their ambitions were not particularly far-reaching. Their basic goal was to influence the CDU so that it would return to its former conservative values.

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Germany's security policy and the Trump administration: modified rhetoric and moderate commitments

Germany's security policy and the Trump administration: modified rhetoric and moderate commitments

Author(s): Justyna Gotkowska / Language(s): English

Keywords: Germany's security policy; Trump administration; Germany; USA

The new administration of President Donald Trump is pushing for its European allies to increase their defence budgets and their military commitment to international security to a much greater extent than previous US administrations. At the 53rd Munich Security Conference and the meeting of NATO defence ministers in February, the US Secretary of Defence Gen. James Mattis and the Vice-President of the United States Mike Pence spoke in this vein. This message is directed at Germany in particular, which has so far been unwilling to substantially increase its defence budget (in 2016 it stood at 1.19% of GDP, i.e. €34.2 billion), or to send the Bundeswehr to operations abroad.Berlin’s response to the US pressure will take into account both political realities (elections to the Bundestag in autumn 2017) and the broader German approach to security policy. Germany will gradually increase its defence expenditure in the future, albeit without reaching the level of 2% of GDP. At the same time, the German government will seek to redefine how European defence spending is calculated. It wants to include in it not only expenditure for military purposes, but also for development and humanitarian aid. In an election year it is hard to expect any significant expansion of the Bundeswehr’s involvement abroad. Instead, Germany will present its efforts to develop the Common Security and Defence Policy (CSDP) within the EU and make the Bundeswehr a hub of military cooperation in the region as its greatest contributions to strengthening European defence. Germany may work towards even greater military integration within the EU, which – if the Social Democrats win the parliamentary elections – could mean favouring European security policy at the expense of trans-Atlantic relations and NATO.

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Capital does have nationality: Germany’s fears of Chinese investments

Capital does have nationality: Germany’s fears of Chinese investments

Author(s): Konrad Popławski / Language(s): English

Keywords: Chinese investments; Germany; economic policy; international relations

The flourishing cooperation in German-Chinese relations is transforming into rocky friendship due to the increasingly strong economic rivalry between the two nations. Recent acquisitions of German companies by Chinese investors indicate that Germany is struggling to defend its interests in bilateral relations with Beijing in an assertive manner. Berlin is becoming increasingly aware of the need to devise and pursue a common EU policy towards China. It cannot be ruled out that the rising power of the Middle Kingdom will be a key argument when devising new initiatives within the EU’s industrial policy for defending Europe against an influx of investors from outside the EU. So far, Germany has been the main brake on progress, blocking the adoption of such solutions. In this context, there may be a chance for American-European cooperation, should the new US President Donald Trump be interested in pursuing a more assertive policy towards China.

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The OPAL pipeline: controversies about the rules for its use and the question of supply security

The OPAL pipeline: controversies about the rules for its use and the question of supply security

Author(s): Agata Loskot-Strachota / Language(s): English

Keywords: OPAL pipeline; Nord Stream; energy policy

The record volumes of gas supplied via the OPAL and Nord Stream pipeline in recent weeks have been accompanied by controversy over the rules for utilisation of the OPAL pipeline’s capacity. There has long been uncertainty as to the actual content of the decision taken by the European Commission at the end of October 2016, the full text of which was published on 9 January 2017. Both the clash of interests between companies and states about how to use the gas pipeline, and the different interpretations of the impact of Gazprom’s increased utilisation of OPAL due to the new EC regulations on the situation on the gas markets in the EU, including in Central Europe and Poland, have been revealed. Uncertainty concerning the principles of the pipeline’s use has also been increased by Poland’s formal challenge of the EC’s decision.

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From purges to a ‘new Turkey’ – the final stage of the state’s reconstruction

From purges to a ‘new Turkey’ – the final stage of the state’s reconstruction

Author(s): Mateusz R. Chudziak / Language(s): English

Keywords: Turkey; state’s reconstruction

The purges in the state apparatus which have been underway in Turkey since the failed military coup represent a decisive stage in the construction of a ‘new Turkey’, involving both the final elimination of the remaining elements of the old Kemalist establishment and the crackdown on the group centred around Fethullah Gülen, a preacher and former government ally accused of plotting the coup. The authorities view him as the greatest threat. In a broader context, the aim of the purges is to ultimately replace the present elites with new ones. This may lead to the elimination of any conceivable opposition capable of threatening the rule of President Recep Tayyip Erdoğan.

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The European Commission enables increased use of the OPAL pipeline by Gazprom

The European Commission enables increased use of the OPAL pipeline by Gazprom

Author(s): Agata Loskot-Strachota / Language(s): English

Keywords: OPAL; European Commission; Gazprom

In response to a request by the German energy regulator, on 28 October the European Commission announced its decision setting out the rules for increased utilisation by the Russian gas company Gazprom (and possibly other companies) of the onshore leg of the Nord Stream gas pipeline, i.e. the OPAL pipeline. This decision raises a series of questions as to its content, its publication procedure, the context of its adoption and its potential consequences. These doubts are aggravated by the lack of clarity of information regarding both the OPAL pipeline itself and the initial rules governing its utilisation (including its exemption from the third party access rule – TPA), and the present decision by the European Commission. As a consequence, the Commission’s decision is provoking conflicting reactions. On the one hand, it is being received (for example by the Polish and the Ukrainian side) as one that enables Gazprom to increase its access to the European market, which could compromise the security of gas supplies to Central Europe and the transit of gas via Ukraine. On the other hand, it is being interpreted as a decision which does not meet the expectations of Gazprom and the OPAL pipeline operator, which sought increased opportunities to book the pipeline’s capacity in the long term. Therefore, it is not known if and when the rules concerning the of OPAL as proposed by the EC will be implemented and, as a consequence, whether the EC’s decision will put an end to the process of negotiating the rules for the German pipeline’s use that has been ongoing for many years.

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Dreaming of normalisation. Germany vs. Russia

Dreaming of normalisation. Germany vs. Russia

Author(s): Kamil Frymark,Artur Ciechanowicz / Language(s): English

Keywords: Germany; Russia; international relations

Russia’s aggression towards Ukraine and its propaganda actions targeting Germany have resulted in an increase in German society’s distrust of Russia and to more assertive political reactions. They have also translated into unprecedented, increased support for eastern allies within NATO. Posing as an architect of the peace process in Ukraine, Germany has indirectly become a hostage to the success of this process (or the lack of it). However, the involvement of both Chancellor Angela Merkel and Foreign Minister Frank-Walter Steinmeier in working out and implementing the Minsk agreement has not brought the results Berlin had expected. This has amplified Germany’s disappointment with both Russia and Ukraine. However, withdrawing from this involvement would scarcely be imaginable due to the significant political capital invested in these actions so far. Hence the attempts to save face and the efforts to ensure the implementation of the agreement, as well as the temptation to devise its subsequent variants (which would be increasingly less favourable for Ukraine).

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Russia's position on the events in Kyrgyzstan (April – June 2010)

Russia's position on the events in Kyrgyzstan (April – June 2010)

Author(s): Wojciech Górecki / Language(s): English

Keywords: Russia; Kyrgyzstan

Russia was the first state in the world to de facto recognise the regime change in Kyrgyzstan that took place on 7 April 2010. This recognition, along with a previous campaign by the Russian media against the then President Kurmanbek Bakiyev, has given rise to suspicion that the events of April were provoked by Russia. However, it seems no more than reasonable to say that Russia provided some inspiration and lobbying in that direction. Russia offered support to the new Kyrgyz government almost immediately, albeit conditionally. Russia's relations with Roza Otunbayeva's government have been changing in nature; they are currently much cooler than they had been immediately after the coup.

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Germany and the Eastern Partnership

Germany and the Eastern Partnership

Author(s): Justyna Gotkowska / Language(s): English

Keywords: Germany; Eastern Partnership

Germany has set its own bilateral cooperation with partner countries in the east above the joint projects of the Eastern Partnership. In doing so, Berlin's guiding principle is that German money allocated for the projects on development cooperation in the east should bring political and economic benefits first of all to Germany. Germany perceives the Eastern Partnership as an initiative that is conducive to German interests, but at the same time as one that could undermine them. Berlin would like the Eastern Partnership to be an instrument that brings the partner countries closer to the EU economically but not politically. Germany has opted for a tightening of the economic cooperation with the partner countries, by signing deals on deep free trade areas and harmonising part of the legislation of these countries with the acquis communautaire. On the other hand, Germany does not want the Eastern Partnership to evolve and turn into an initiative that offers the partner countries prospects of membership and antagonises Russia. Therefore Germany is trying to counteract any elements of the Eastern Partnership that would help it develop in the aforementioned direction. Moreover, Germany has set its own bilateral cooperation with partner countries in the east above the joint projects of the Eastern Partnership. In doing so, Berlin's guiding principle is that German money allocated for the projects on development cooperation in the east should bring political and economic benefits first of all to Germany.

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The Ukrainian government’s strategy towards the opposition

The Ukrainian government’s strategy towards the opposition

Author(s): Tadeusz A. Olszański / Language(s): English

Keywords: Ukraine; opposition

In recent months in Ukraine, there has been a toughening of measures targeted at opposition leaders, in particular the former Prime Minister Yulia Tymoshenko and the former interior minister Yuri Lutsenko. These two have been charged with abuses of office when in power. The way in which the criminal investigations are being conducted shows that these measures are actually meant to prevent the two politicians from conducting regular political activities, or at least to make this practically impossible for them. These actions are an element of the Party of Regions’ long-term strategy, as it tries during the pre-election period to eliminate Yulia Tymoshenko from political life and weaken or even destroy her powerbase. Similar measures, although to a more limited extent, are being taken against other opposition groups. These actions are leading to the lowering of democratic standards in Ukraine, although these are still much higher than in Belarus or Russia; this has been proved, among other things, by the militia’s more restrained behaviour towards the protesters, and the fact that abuses of the law during the current investigations have not yet slipped into actual violations. The Ukrainian opposition is fragmented and disorganised; even the Yulia Tymoshenko Bloc is unable to stage a major campaign in defence of its leader. This allows the authorities to feel free to tighten their policy towards the opposition.

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The Western Balkans: deadlock in the EU enlargement process

The Western Balkans: deadlock in the EU enlargement process

Author(s): Marta Szpala / Language(s): English

Keywords: Western Balkans; EU enlargement process

On 9 November the European Commission presented the annual reports assessing the progress of the Balkans states in their preparations for EU membership, the enlargement strategy up to autumn 2011, and the assessment of the EU membership applications submitted by Albania and Macedonia. All these documents show that the reform process in the Balkan states has slowed down in comparison to previous years. The main reason for this slowdown is the negative consequences of the global economic crisis for these countries. Nonetheless, the transformation process is continuing, despite these difficulties.

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Lukashenka has to choose: reforms or concessions to Russia

Lukashenka has to choose: reforms or concessions to Russia

Author(s): Kamil Kłysiński,Wojciech Konończuk / Language(s): English

Keywords: Lukashenka; Russia; Belarus

The most serious crisis in the history of Russian-Belarusian relations has been taking place over the past few months. In 2007 Russia started the process of depriving Belarus of subsidies in the form of supplies of fuels at low prices, which have for more than a decade guaranteed the stability of the Belarusian economic model, and is continuing this process now at an accelerated rate. At the same time, the Russian media started attacks on Alyaksandr Lukashenka from the middle of this year. This toughening up of Russia’s measures indicates that the Kremlin is determined to implement its goals regarding Belarus, including first of all taking over its strategic economic assets, which would result in a significant weakening of Lukashenka’s position. The Belarusian government has been consistently avoiding meeting Russian demands, while at the same time insisting on the reinstatement of preferential conditions of co-operation. If the Belarusian leader continues resisting Russian demands, the crisis in Russian-Belarusian relations will be aggravated, and a conflict over energy issues around the turn of 2011 cannot be ruled out.The reduction in preferences offered by Russia in the energy sector has significantly impaired the condition of the Belarusian economy, and may lead to its breakdown in a year or two. As his country comes under increasing pressure from Russia, Alyaksandr Lukashenka will soon have to make a strategic choice between yielding to the Kremlin’s demands and embarking upon an at least partial restructuring of the economy.

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