Perestroika Belarusian-Style: The Logic of the Systemic Crisis

Belarus is slowly sinking under the weight of a political crisis that is affecting the very foundations of the social system and which may take some time to resolve, since the political establishment essentially controls all spheres of society. If the political system crumbles, governance in the country will effectively grind to a halt, and it will be a long and painful process to get the motor running once again.

There are many layers to the current situation, and political or economic instruments alone are not up to the task of dragging the country out of the mess it now finds itself in — public institutions and governance methods need to be brought into the present day. Even if Russia decides to prop up the Belarusian economy, which it is doing right now, this will not resolve all the differences that have built up over the years.

If the Belarusian leadership cannot manoeuvre itself out of the situation by making qualitative changes, then the situation will become hopeless sooner rather than later. Continuing the policy of recent years will only make things worse, and will inevitably result in the current authorities losing their grip on power.

The only viable way to make the reform as painless as possible is to remove the obstacles to the development of the Belarusian economy through its large industrial and economic complex, which would provide a safety net for the most vulnerable social groups, as well as investments for big business. However, the only country that would even entertain the idea of such an agreement is Russia.

The massive street protests that have taken place in Belarus recently are only the tip of the iceberg of what we can expect to see in the coming months and years. Although, of course, the situation in the country bears little resemblance to the endless crises in Belgium and Italy, which are capable of existing perfectly well without a central government for decades. Belarus is slowly sinking under the weight of a political crisis that is affecting the very foundations of the social system and which may take some time to resolve, since the political establishment essentially controls all spheres of society. If the political system crumbles, governance in the country will effectively grind to a halt, and it will be a long and painful process to get the motor running once again.

Some have called the events in Belarus a colour revolution, likening it to the Euromaidan protests that took place in Ukraine in 2013–2014. And while there are clearly parallels between the two, it would perhaps be more accurate to say, as some commentators have, that the crisis more closely resembles a kind of “belated” perestroika. The ideas that have formed the cornerstone of Belarus’ foreign policy since 2014 — that it is a “security donor” in Eastern Europe and a “neutral state” — have come back to haunt the country’s leadership. Right now, the only thing stopping Belarus from becoming an “instability donor” is the continued political and economic support of Russia.

The Origins of the Crisis

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At first glance, it would appear that the political crisis is a consequence of the supposedly botched presidential elections in August. But the elections only served as a trigger for the next phase of a crisis that had been unfolding for years, which involved people taking to the streets in their thousands. On the surface, there is an economic component to what is happening: the national economy is dominated by state enterprises, but their equipment is outdated and the country does not have the money for modernization.

In the 1990s, Belarus was able to avoid the most painful consequences of perestroika by buddying up to Russia. It set about building state capitalism with a “human face” (social benefits and guarantees) while at the same time relying on the Soviet industrial potential, the Russian market and economic support.

The Belarusian economy was effectively rebuilt from the ground up as a part of a single economic space with Russia. For example, Belarus has enjoyed a massive discount on Russian oil and gas over the past ten years compared to other importers, to the tune of approximately $70 billion, or 55 per cent of the state budget for that period [1]. Belarus has exported over $110 billion worth of industrial and agricultural products to the Russian market over the past decade [2]. Russia accounts for between one half and two-thirds of all foreign direct investment into the Belarusian economy.

The system as it is currently set up can survive another year, and some elements may even develop if it continues to have free access to Russian investment and the Russian market. But there is a deep contradiction at the heart of this model — while the Russian and Belarusian economies are de facto the same, their management systems are not, and their regulatory bases are drifting further and further apart.

This problem has proved to be a sticking point, with intensive negotiations on possible “road maps” for the Union State bringing little to no progress over the past two years. And where integration fails, disintegration gathers steam, which is exactly what we have been witnessing in recent years. At the same time, the industrial facilities of most Belarusian enterprises are becoming obsolete. Belarusian industry is in a race against time, and it is losing, with hundreds of thousands of workers set to lose their jobs. Soon it will be no more, to be followed by the social and educational infrastructure, and then the schools of engineering and mathematics (which have been "feeding" the fledgeling Belarusian IT cluster "for free"). The belief of some business leaders that Belarus will rise like a phoenix from the ashes to become an IT leader, abandoning ties with Russia and thus leaving the outmoded industrial sector in the past, is based on nothing but ideology.

The root of the crisis that is unfolding in Belarus lies in the fact that the government is becoming increasingly out of touch with society. The political institutions in the country have proved unable to internalize public activity, engage in a meaningful two-way conversation with the people and respond to the requests of a significant part of society. Hence the numerous “mistakes” of the authorities in recent years — symptoms of systemic failures. Actions that in certain conditions were seen as the norm and brought results are in others seen as mistakes and turn out to be counterproductive.

It is not enough to simply replace the people in charge. It will take years of hard work for Belarus to emerge from the crisis, and there is an extremely high risk that the political system could break down completely, which would have a devastating effect on the country’s economy — far worse than the economic troubles experienced by Ukraine since 2014.

Components of the Crisis

Let us try to reconstruct the main phases of the Belarus crisis (some of the events overlap).

Economic. The obsolescence of the country’s backbone industries and the lack of money to modernize them became a serious issue back in the 2000s. This forced the authorities to quietly dismantle the post-Soviet social safety net, which had always been a source of pride within the country. Few even batted an eyelid when the retirement age was increased. But it was a different story with the new tax on the officially unemployed (the so-called "decree on parasites"), which was met with a flurry of protests in 2017.

Social. The structure of Belarusian society has changed. The number of self-employed persons and small businesses in the country has increased, and urban culture and international contacts have developed — all at a far quicker pace than the state management systems in the public and social spheres have been able to adapt. The government still uses the same mass command and obedience methods in its youth policy and social mobilization that were developed some 20–30 years ago, or even during the Soviet period, despite their shortcomings. Assistant to the President of Belarus Nikolai Latyshonok has said that "about 20 to 30 per cent" of the population is dissatisfied with the Belarusian authorities. Considering that this is 20 to 30 per cent of registered voters, it translates into 1.5 to 2 million people, which is a huge number for Belarus.

Generational. Sociologists have noted a real transformation over the past ten years in the dominant attitudes and values of the “post-Soviet generation” as its representatives move into adulthood. The younger generations are far less supportive of the authorities and do not share their style or aesthetics. The generational gap in Belarus in 2014–2015 was almost identical to that of Moldova and Ukraine, and there is no reason to believe that the situation has improved since then.

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Ideological. The economic backwardness of the country, coupled with the reduction in social guarantees and the change of generations has led to a crisis of ideology in Belarus. To fill the growing ideological vacuum, the Belarusian authorities have placed increasing importance on so-called “soft Belarusization”, attempting to supplement the ideological matrix of the Byelorussian Soviet Socialist Republic with new symbols and meanings, from the Belarusian People’s Republic and “millennial statehood” to traditional Belarusian embroidered shirts and the restyling of the national emblem. But this did not have the desired effect of consolidating the country. Instead, it led to the erosion of guidelines within society and the state apparatus. The attempt to present the question of “Minsk or Mensk” (Belarusian versus Russian), which is irrelevant for the majority of Belarusian citizens as the main “nerve” of the election campaign, turned out to be a failure, causing mistrust among the government’s supporters. The nationalists, with the support of the ramified structure of Western NGOs that had been growing in the country over the course of the last 20 years and had penetrated the government bodies, seized the ideological initiative.

Foreign Policy. The Belarusian leadership tried to mitigate the growing systemic problems inside the country by pursuing an active foreign policy, but this tactic backfired. The balanced diplomacy of the Belarusian government between 2014 and 2016 allowed it to extract certain diplomatic and economic dividends from the Ukrainian crisis. But there would soon be a price to pay, with the contradictions inside the country starting to worsen and the goal of the state apparatus to pursue multi-vector development turning into an exercise in distancing itself from Russia and flirting with the “Russian threat.” All of this served to disorient and destroy the electoral base within the country. And the only thing that the Belarusian authorities have to show from this policy of the past four to five years is growing isolation from the country’s only ally — Russia.

These trends intertwine and reinforce one another, showing that the crisis in Belarus is much more than “just” a colour revolution, which is merely a symptom of a much more serious illness.

Perestroika does not mean that the existing system is wrong, completely bankrupt and without hope — it is by no means destined to collapse. Despite the crisis, the Belarusian system has a number of undeniable advantages, including the relatively low level of social stratification, well-developed social services, a quality education system and industrial expertise. The Belarusian "model" developed back in the 2000s and the politics we see today are not the same thing. Similar to the Soviet perestroika era, the way in which the authorities have handled the crisis is the main reason it is getting worse.

The Economic Dimension of the Crisis

The economic crisis is a result of the failure of the post-Soviet model of the Belarusian economy. The only thing left is either Balticization (but without access to the sea), in which case the country would lose its heavy industry and suffer the mass emigration of its “surplus” population, or optimization and modernization with the help of outside investors.

The European Union is Belarus' second-largest foreign trade partner and, according to EU statistics, purchases 4 billion Euros' worth of goods from the country per year. Belarus' main exports are timber, mineral products (oil and oil products made using Russian oil purchased at heavily discounted prices) and base metals. Raw materials and semi-finished products make up over 80 per cent of Belarus' exports to the European Union. Strikes at large Belarusian enterprises may lead to a drop in the supply of metals, oil products and potash fertilizers to the European Union.

These losses will hardly make a dent in the European economy and can be replaced using other suppliers. Belarus, however, will suffer, although the damage will not be critical, as the European Union accounted for approximately 20 per cent of the country’s foreign trade in 2019. The potash markets are now growing, which is primarily thanks to Asia.

Belarus could suffer greatly if the European Union refuses to import oil products, but this is unlikely to happen. Belarusian oil refineries will probably become unprofitable if the high cost of European logistics forces them to purchase oil elsewhere, at global prices.

Losing the Russian market, which accounts for half of Belarus’ trade turnover, would be an unmitigated disaster for the country’s economy. What is more, Russia’s imports include machinery with high added value. If the political crisis in Belarus results in forces coming to power that want to withdraw from the political and economic integration agreements that the country has with Russia, then this will lead to the destruction of Belarusian industry, and hundreds of thousands of highly qualified specialists will lose their jobs.

Many large state-owned enterprises in Belarus perform social functions — excessive hiring prevents unemployment from skyrocketing and alleviates social tensions. A similar situation exists in many industrialized countries. What complicates the issue in Belarus is the lack of a safety buffer, as well as sufficient internal resources, to maintain and develop such a system. Any radical market reform will invariably lead to an explosion of public anger.

Multi-Vectorality and Belarusization

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Belarus officially set a course for a multi-vector approach in the 2000s, writing it into key legislative and regulatory acts 15 years ago. Experts and officials in Belarus have repeatedly stated that small countries must naturally pursue a balanced foreign policy, even though all of its Western neighbours have chosen the opposite strategy of “joining together” and bloc discipline.

The Ukrainian crisis only intensified this trend, with the Belarusian authorities trying to draw attention away from its domestic problems by pursuing a multi-vectored and largely symbolic policy. This was motivated first of all by the desire to gain economic bonuses by playing on the contradictions between Russia and the West, and secondly by the need to distract the Belarusian people from the social problems in the country and bolster the legitimacy of the authorities, adopting the nationalist agenda and framing it as “soft Belarusization.”

The increased pace of multi-vectorality had the opposite effect. Belarusian exports to the European Union fell by 9.4 per cent as of year-end 2019 to below the 2010–2011 figures. Russia still accounts for approximately half of Belarus' foreign trade, but it has begun to move gradually towards import substitution amid troubles in the integration process.

Competitive growth on the Russian domestic market is both an objective and natural process. The only way to restrain this process or further boost advantages enjoyed by Belarusian producers is through specific political action and inter-state economic projects. But this has become impossible due to the gradual nullification of geopolitical guarantees that has taken place as Minsk's multi-vectored policies have developed.

The idea of Belarus as a “security donor” in Eastern Europe was designed to help the country build its foreign policy around being a mediator between Russia and the West, without taking sides. But it turned out that the building had been built on sand, and now the Chancellor of Austria (a neutral country) has called for negotiations on the Ukrainian crisis to be moved from Minsk to Vienna.

Most have come to the conclusion in recent months that the Belarusian authorities have “lost the information space” — a consequence of new media and the appearance of various messenger services. However, it would seem that ideology is responsible for this loss, rather than a poor grasp of modern technology. And the “informational neutrality” declared in the 2019 Concept of Information Security of Belarus was the icing on the cake of this long-term trend. The document effectively tied the government’s hands in terms of putting up resistance to opposition forces and foreign NGOs inside the country.

The void that had appeared was slowly being filled with the concept of "sacrifice" taking root in the country (Belarus has taken part in the wars of others and suffered as a result of its neighbours "in both the West and the East). A big part in this process was played by Western funds, supported by a part of the Belarusian state apparatus. This directly contradicted the ideological foundations of the victory in World War II. Belarus' Independence Day continues to be celebrated on July 3 — the same day that Minsk was liberated from the Nazis in 1944. For most millennials, however, Victory Day is nothing more than a national holiday that does not conjure up any particular feelings of patriotism. This is because there is a lack of modern meaning that young people can identify with, a dearth of ways to get them involved.

The obsession during the election campaign with the virtual “Russian threat” — something that even the nationalists did not believe — was thus no accident. Rather, it was a logical development of the government’s multi-vector strategy. This is the same path that the Baltic states have already travelled, moving from a “bridge between East and West” to “neutral countries,” then “frontline states” and, finally, “bastions against Russia.”

***

There are many layers to the crisis that is currently unfolding in Belarus, and political or economic instruments alone are not up to the task of dragging the country out of the mess it now finds itself in — public institutions and governance methods need to be brought into the present day. Even if Russia decides to prop up the Belarusian economy, which it is doing right now, this will not resolve all the differences that have built up over the years. All the more so because nothing is being done to revise the country’s multi-vectoral doctrine. At the same time that President of Belarus Alexander Lukashenko is accusing the United States of interfering in its domestic affairs, Minister of Foreign Affairs Vladimir Makei can be heard thanking the Department of State for “supporting the sovereignty of Belarus.”

If the Belarusian leadership cannot manoeuvre itself out of the situation by making qualitative changes, then the situation will become hopeless sooner rather than later. Continuing the policy of recent years will only make things worse, and will inevitably result in the current authorities losing their grip on power.

The main question now is how Belarus will emerge from the crisis — through gradual and deliberate transformations or by scrapping the system altogether and dealing with the severe consequences that that would entail. In any case, it will be very different from what happened with Ukraine, as we are not talking about access to fertile soil and sea routes; the domestic market and the demographic resources are far smaller.

The only viable way to make the reform as painless as possible is to remove the obstacles to the development of the Belarusian economy through its large industrial and economic complex, which would provide a safety net for the most vulnerable social groups, as well as investments for big business. However, the only country that would even entertain the idea of such an agreement is Russia.

Meaningful constitutional reform is taking shape, a political transition that aims to adapt the system of governance to modern realities. But it is not enough. The mass demonstrations that we see today are reminiscent of the "singing revolutions" that took place in the Baltic states in 1990–1991. Just like the popular fronts in these countries broke out of the control of the communist party and the KGB, the opposition forces in Belarus today, inspired by the official Belarusization, are turning against the authorities. The second step in these revolutions involved a change of leadership, the strengthening of the nationalists, reorientation to the West, the introduction of the concept of “non-citizens” for ethnic Russians living in the Baltics, etc.

This does not mean that Belarus is doomed to follow the same path, as its ties with Russia run far deeper. The Russian side is doing everything in its power to preserve stability in Belarus, keep external influence at bay, and hold on to the special relationship it has with its Belarusian friends. But the risks are exceptionally high. The situation in Belarus is not static and could take a turn for the worse at any moment. Alexander Lukashenko still has time to make the most important decision of his life.

1. Author’s calculations based on data from the National Statistical Committee of the Republic of Belarus, the Ministry of Finance of the Russian Federation and Gazprom.

2. Author’s calculations based on data from the Federal Customs Service of Russia.