Lukashenko controls Russo-Belarusian cooperation issues
On May 21st, Belarus and Russia Prime Ministers Myasnikovich and Medvedev met in Moscow.
The Prime Ministers’ meeting results confirmed assessment that President Lukashenko was still in control of privatization in Belarus. Therefore, the most controversial issues of the Belarusian-Russian cooperation will be addressed at the meeting between presidents Lukashenka and Putin in Astana in late May at the CES Summit.
The meeting between Myasnikovich and Medvedev had negative results. The parties failed to agree on the most contentious bilateral relations issues: privatization and oil trade. Earlier, the two countries’ Deputy Prime Ministers Semashko and Dvorkovich also failed in reaching the final agreement. Thus, the issue of oil supply volume to Belarus in Q3 and Q4 2013 remains unresolved (must be signed by mid-June).
In Russo-Belarusian relations, Prime Minister Myasnikovich is only a ‘technical’ figure with no independent influence. He managed to strengthen his positions during the 2011 crisis, but later failed to preserve his political capital. Therefore, no breakthroughs should be anticipated during Medvedev’s visit to Minsk on May 31st to participate in the Council of CIS Heads of Government meeting, since these issues are not resolved at the Prime Minister’s level.
President Lukashenko is the key political figure in Belarus’ foreign policy and Belarusian-Russian relations in particular. Lukashenko’s nearest opportunity to meet with Putin will be in late May at the Supreme Eurasian Economic Council meeting of the Common Economic Space member states.
Noteworthy, the two planned meetings between Lukashenko and Putin failed to take place, one in Sochi on May 10th during the amateur hockey tournament, and the second at the informal CSTO summit on May 28th in Bishkek. The first meeting was disrupted after the controversial disqualification of the Belarusian President’s hockey team, and the second (on May 28th) will not take place due to the revised Summit’s agenda, which will focus on the Central Asian security issues. Thus, Belarus and Armenia will not participate in the Summit.
The Labour and the Tax Ministries are considering the possibility to include persons engaged in some economic activity without forming a legal entity in the social security system. When the decree No 337 comes into effect, the number of private entrepreneurs is likely to reduce due to the possibility of reducing the tax burden when switching to a tax payment as an individual. 95% of self-employed, including PE, pay insurance premiums on the basis of the minimum wage. The number of self-employed citizens is expected to increase, the number of insurance contributions to the pension system from PE will decrease, the number of citizens who will pay a fee to finance government spending will decrease by several tens. Self-employed citizens have the alternative not to pay social security fees and save resources for future pensions, which, given the gradual restriction by the state of pension requirements could be a more long-sighted option.