Prime Minister Myasnikovich’s resignation is a matter of time

On January 18, Alexander Lukashenko released Pyotr Prokopovich of his duties as Presidential Aide and appointed him Deputy Prime Minister.

Appointment of Prokopovich as Vice-Premier further limits the Prime Minister Myasnikovich ability to make cosmetic changes to ‘liberalize’ economic policy. In fact, the government is now run by the conservatives – direct appointees of President Lukashenko. Myasnikovich’s resignation becomes only a matter of time.

When appointing Prokopovich, President Lukashenko said he was expecting the new Deputy Prime Minister to “meet the basic parameters of socio-economic development of Belarus, to execute the state budget and to modernize Belarusian economy”. These requirements set forward for the Deputy Prime Minister imply that the president is not satisfied with Prime Minister Myasnikovich’s performance.

As noted earlier, in 2012, Myasnikovich government consistently weakened. Two Myasnikovich deputies, Ivanov and Rumas have been dismissed and his attempts to meet the requirements of Belarus’ international lending partners, first of all, the EurAsEC ACF, where it concerned the privatization programme – were halted and even made into a re-privatization process. Finally, Myasnikovich’s government failed to meet the 2012 economic growth plan at 5-5.5%, which gives the President a formal reason to stop trusting Myasnikovich.

It is therefore extremely significant that the president appointed Prokopovich responsible for the ambitious modernization programme. It is noteworthy that Myasnikovich was not present at the scandalous “debriefing” with Alexander Lukashenko at the woodworking industry at the end of 2012. By then Myasnikovich had headed the government for almost two years and should have known about the problems in this industry.

In practical terms, if Belarus finds the necessary financial resources, Prokopovich’s appointment is likely to result in a resumption of the large-scale housing construction in the country and accordingly, lending to businesses and citizens. Prokopovich is a housing construction professional and is known for lobbying this industry interests, moreover, President Lukashenko is convinced housing construction is the economy’s engine. In particular, in 2013 Belarus plans to build 6.5 million square meters of housing, in 2014 – 8.5sq. m. and in 2015 – 9.5sq. m. Therefore, Prokopovich is likely to make efforts to further reduce the refinancing rate.

At the same time, 70-year old Prokopovich should not be regarded a potential successor of 62-year old Myasnikovich. In 2011 Prokopovich had a heart surgery and retired for health reasons. The most likely future successor of Myasnikovich is former Assistant to the President for Economic Affairs Sergey Tkachev, who in August 2012 assumed a position at a large industrial holding Amkodor.

Tkachev drafted the economic performance plan for 2012, which Myasnikovich government failed to implement. Tkachev experience and loyalty to the President are best suited for ambitious declarations about continued economic growth before the presidential elections in 2015.