Jan 4, 2007

Beginning of the end for Lukashenka?


So, let's start asking the question: what happens if this gas crisis ruins Belarus and takes Lukashenka with it? Would Moscow be in a position to install a puppet in the president's chair in Minsk - it wouldn't be the first time Russia butted into electoral politics in neighboring states and statelets (Ukraine and Abkhazia being the most obvious examples). How much would the "Russia factor" count? Will Lukashenka go? I'm eager to hear some responses to my questions posed here... JCE

RFE/RL: Belarus: How Hard Could Gas Price Hike Hit Economy?

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I'd venture that the Gazprom deal is the clearest signal yet, that Kremlin Inc. has decided to make a change in Belarus.

On balance, the energy deal puts Lukashenka on the receiving end of a python squeeze. Even the sale of Beltranshaz is disadvantagious, as the 2.5 billion will be paid over 4 years and not fully offset the price crunch. In selling Beltranshaz, Lukashenka surrendered one of his last negotiable assets. Just as the last of the Beltranshaz money is paid, the price of energy is set to rise even higher, pushing inflation to a projected 12-14 percent and severly limiting purchasing power.

It is true that "one of Belarus's only options might be to reform the country's economy [thru] privatization of the major industries and reforming the collective farm system," but that is an exceptionally unlikely outcome, given Lukashenka's track record.

This provides Moscow with a three - four year window in which to select a successor to Lukashenka, if his own citizens don't topple him first. PBD

1 comment:

Pirates&Diplomats said...

They could always poison him - worst case scenario, he ends up looking a little worse than William DeFoe, best case scenario, he gets a martyr's statue in Independence Square. Maybe a lead coffin, to boot - depends what style of assassination is "in".

"The total effect of the energy price discount amounts to over $7 billion a year, or 30 percent of the nation's GDP." (RFE/RL Belarus: Controls, Subsidies, And Cheap Gas, March 15, 2006). Wow. Proportionally, that would be the United States losing California, Texas, New York, and some crap state like Wyoming. We would be utterly rock-and-rolled, on which you could build no city.

JCE