Belarusian authorities upbeat about future cooperation with China

The Belarusian authorities hope to use the visit of President Xi Jinping to demonstrate success of President Lukashenka state policy. They also count on positive impact from the signed agreements on people’s expectations regarding cooperation with China and connected economic growth. However, amid deteriorating socio-economic situation in Belarus, all this upbeat rhetoric is unlikely to increase President Lukashenka’s popular ratings.

On the eve of President Xi Jinping visit to Belarus, President Lukashenka gave an interview to Xinhua, Chinese news agency.

During his two-day visit to Belarus, Xi Jinping is planning to sign the Treaty of Amity and Cooperation and a Joint Declaration after the meeting with Alexander Lukashenka.

Sino-Belarusian meetings at the highest level will have broad media coverage in Belarus. The Belarusian propaganda will try to present this visit as a historical event demonstrating a breakthrough in relations with China. Ahead of the presidential campaign, the Belarusian authorities might try to re-focus on the prospects of economic cooperation with China and on Chinese investment as an impetus for economic development and growth of population’s well-being in the coming years (after the 2015 presidential elections).

Amid economic recession and lowered social protection, the Belarusian authorities might attempt to sell the hope for future economic growth due to Sino-Belarusian cooperation to the population.

China is currently taking a closer look at economies of countries, which may become a part of the ‘Silk Road’, an ambitious Chinese infrastructure project envisaging over USD 40 billion investment. This is a long-term project, which includes several focus areas.

In the interview with Xinhua, President Lukashenka assured that “the Belarusian model” had a lot in common with the Chinese economic model, and underscored the importance of stability.

In addition, the president underscored the similarity of views on political issues between the countries, however, for China that was not a priority issue. Since the 1980s, Beijing has been promoting the ‘openness to the world’ concept, which envisages pragmatic cooperation with all types of political regimes, if it is beneficial for China. Yet in the late 1990s, Beijing persuaded Minsk to accept ‘one China’ policy, aiming against Taiwan independence, and ensured the lack of criticism of Chinese policy in Tibet.

The Belarusian authorities have repeatedly voiced their hopes for deeper cooperation with China, which in their viewpoint should stimulate economic development in Belarus. Meanwhile, Belarus still has not used the USD 15 billion loan allocated by Beijing. In addition, some jointly implemented Sino-Belarusian projects had negative effects (eg cement industry modernization). Belarusian companies do not show a high interest in tied Chinese loans – mainly due to the poor quality of equipment supplied from China. Moreover, Sino-Belarusian trade balance has not improved – imports from China make between 75%-85% of the total turnover.

In addition, the Belarusian authorities hope to step up the development of the ‘Great Stone’, Sino-Belarusian industrial park, which until now has been rather idle. For example, Chinese company China Merchants Group said it would invest up to USD 500 million in a large logistics centre near Minsk – a platform for economic hub of the Silk Road project – by 2020.

Belarus is unlikely to improve its economic situation significantly in the coming three/four years thanks to deeper Sino-Belarusian economic and political cooperation.