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New Year, New Government and New Crisis in Belarus

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New Year, New Government and New Crisis in Belarus

With all eyes on the financial crisis in Russia and the ongoing conflict in Ukraine, it is easy to overlook events in Belarus at the end of last year. December 2014 saw a major government reshuffle and a steep devaluation of the Belarusian currency on the eve of an important election year. Belarusians will go to the polls in 2015, potentially electing President Aliaksandr Lukashenka for a fifth consecutive term, albeit under unfree and unfair conditions.

As Russia was gripped by a currency crisis in mid-December, Lukashenka assured the public that there would be no devaluation of the Belarusian ruble on 18 December. This did not reassure Belarusians, who flocked to buy dollars and euros. Independent news sites reporting on the financial difficulties were blocked for a time. On 19 December a 30% commission was introduced by the National Bank for buying hard currency at exchange bureaus. The commission was gradually reduced over the coming weeks and lifted altogether on 8 January. During that period Belarus in effect experienced a 26% devaluation of the national currency, and the prospects are that it will continue to depreciate.   

The head of the National Bank, Nadzeia Ermakova, was sacked and replaced by her deputy, Pavel Kalavur, on 27 December. At the same time the veteran bureaucrat Mikhail Miasnikovich was dismissed as prime minister, after four years in the post and months of speculation. His replacement, Andrei Kabiakou, was previously head of the Presidential Administration and a close ally of Lukashenka. Aliaksandr Kasinets, former governor of Vitebsk region, was named head of the all-important Presidential Administration. Three new regional governors were also appointed, as were several deputy prime ministers and deputy heads of the Presidential Administration.

No new faces particularly stand out in the new government and there is unlikely to be any major drive for serious reform. Younger officials who are often perceived as more liberal, such as head of the Development Bank, Siarhei Rumas, and the Ambassador to France, Pavel Latushka, were not moved to more prominent positions. The government’s priority will be minimizing the spread of any Russian contagion to the Belarus economy through ad hoc measures and ensuring Lukashenka’s re-election in the poll which must be held by 20 November 2015. There is speculation that the elections could be brought forward to the spring to pre-empt more problems later in the year, although it may already be too late for such as tactic already as Belarus already faces a currency crisis.

Economic problems were already impacting Lukashenka’s popularity according to independent polling. Support had slipped to 40% by the early December 2014, before the latest crisis, although this was still far ahead of any potential alternative candidate. The 2011 financial crisis in Belarus suggests that although dissatisfaction with Lukashenka can increase, it does not automatically translate into widespread public protest or support for the opposition. The Belarusian opposition has so far failed to unite behind a candidate, platform or strategy for the 2015 presidential elections. Even with a marginalised opposition, the authorities are likely to resort to electoral manipulation in order to inflate turnout and ensure the requisite 75-80% share of the vote that Lukashenka has always been elected by according to the official Central Election Commission results. While the world will continue to focus on Russia and Ukraine in 2015, it will be worth keeping an eye on political and economic developments in Belarus, which could end up posing challenges for the international community.

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