Lukashenka Will Be Cut Off From Currency

The EU imposes an economic blockade on the regime.

The European Union has agreed on a package of tough economic sanctions against Belarus, which will cut off the regime of Aliaksandr Lukashenka from earnings in hard foreign currency.

The sanctions package, conceived as a response to the forced landing of a Ryanair flight in Minsk, includes sectoral sanctions against key Belarusian exports.

Europe will ban purchases of oil, oil products, and potash fertilizers in Belarus, Reuters reports, citing diplomats.

According to the agency's sources, the sanctions package was agreed upon after Austria, the only EU member calling for a softening of the measures, withdrew its objections.

The package of sanctions will also include restrictions on the financial sector - a ban on loans, operations with securities, and investment services.

In addition, it is planned to tighten the ban on the supply of weapons, which the Lukashenka regime uses to suppress protests, specifies a diplomatic source AFP.

The broad measures are aimed at “hitting Lukashenka in the wallet,” he emphasizes: “We are talking about sanctions that will hurt.”

The final approval of the package is expected to take place at a meeting of EU foreign ministers on Monday 21 June.

The result of the sanctions will be a blow to the inflow of hard foreign currency into the Belarusian economy, which is half provided by the resale of Russian oil purchased at discounted prices, its refined products, and potash fertilizers.

Since April, the country's largest refinery, Naftan, has come under US sanctions, after which European banks refused to credit its supplies, and Russian oil workers suspended supplies of raw materials, fearing to fall under secondary measures of the Foreign Assets Control Department.

Cut out from the dollar zone, the Belarusian oil refining sector will now lose access to payments in euros, and Belaruskali will be included in the "blacklists" of Belarusian refineries.

In total, Belarus earned $ 7.5 billion from the sale of oil products and fertilizers in 2019 - 55% of all foreign exchange earnings from exports to non-CIS countries ($ 13.6 billion).

The foreign exchange famine promises the economy difficulties in repaying the external debt, which amounted to $ 42.1 billion as of January 1.

At the same time, the gold and foreign exchange reserves of the National Bank of Belarus amount to only $ 7.76 billion, of which only $ 3.194 billion are in real currency, and the remainder is placed in gold and illiquid assets.