Lukashenko’s domestic legitimacy degraded
On 19 May Minsk hosted Summits of the Heads of Governments of the CIS, of the EurAsEC and of the Customs Union simultaneously. Belarus organized such well-represented events for the first time during the fourth Presidency of Alexander Lukashenko.
Summits of the Heads of Governments of the CIS and of the EurAsEC countries held in Minsk on 19 May have substantially increased the international legitimacy of the Belarusian government however the outcome of the bilateral Belarus-Russian meetings dramatically weakened the domestic legitimacy of President Lukashenko.
The domestic legitimacy of the President Lukashenko suffered due to the inconsistency between the Summit’s expectations and its outcomes. On 16 May Alexander Lukashenko publicly spoke about the high probability of the allocation of about $ 6 billion loan for Belarus by Russia in 2011 however the Summit showed he could count on about $ 1.2 billion in two separate tranches of $ 800 million and $ 400 million each with a large time gap between them and on the conditions of the implementation of a series of economic reforms.
Moreover, a late night tet-a-tet meeting with Vladimir Putin passed without a final news conference that would allow Lukashenko to appear before the media as the Head of state who solved the "big issue".
The assumption about the weakening of the domestic legitimacy of Lukashenko is supported by the surprise announcement of the Chairman of the Belarusian Liberal Democratic Party S. Gaidukevich, who on 21 May accused the government of failing to control the situation at the currency market and urged for its resignation.
Nevertheless the Summits of the EurAsEC, CIS, and the Customs Union in Minsk made an important contribution to the strengthening of the external legitimacy of the Belarusian government in the post-Soviet space. The Prime Minister of Belarus Mikhail Myasnikovich held several bilateral meetings and chaired the plenary meeting of the Heads of Governments. All in all, following the unsuccessful negotiations with the Russian Prime Minister Putin, the President Lukashenko withdrew from the information space, while M. Myasnikovich became a major newsmaker regarding issues related to loans for Belarus.
A meeting of the Crisis Fund of the Council of the EurAsEC, set to adopt a formal decision on the stabilization loan for Belarus amounting to $ 3 billion with annual tranches of $ 1 billion each during 2011-2013, will be held on 4 June in Moscow. Obviously, the schedule of transfers will be linked to the implementation by Belarus of the conditions agreed between Myasnikovich and Kudrin.
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.