China Will Not Spend Money on the Belarusian Regime

Relations between Beijing and Minsk have been paused.

Aliaksandr Lukashenka, as well as government officials and propagandists, often repeat that, in a difficult period, Belarus can always rely on China, which is ready to lend a shoulder. But is it really so? Nn.by journalists talked about the Belarusian-Chinese relations with political observer Arseniy Sivitsky. The expert once put forward quite unexpected hypotheses: China will not invest in a country that has bad relations with the European Union.

- How would you describe the current state of Belarusian-Chinese relations? The trade turnover is allegedly growing, but primarily due to imports from China. Does this indicate that China is helping Lukashenka in a difficult situation?

- We need to start with the fact that the growth of trade between China and Belarus is not a characteristic by which one can judge the depth of relations between Beijing and Minsk. The main problem of our relations is that, no matter how this trade turnover grows, a negative balance remains for Belarus. This is even though, in recent years, several agreements have been reached that have opened the Chinese markets for Belarusian products, primarily agricultural.

Belarus is no exception in this trend, all countries trading with China have a negative balance, even the United States. This often leads to trade and political conflicts between Beijing and Washington. I would not say that this is only a problem of the Belarusian-Chinese economic relations - it is rather a common situation for any country that has relations with the world's largest economy.

More interesting is the political and geopolitical aspect in relations with China. The fact is that, since independence, over the past 30 years, the Chinese-Belarusian relations have reached their highest form - this is "all-round, all-trusting strategic partnership and mutually beneficial cooperation." Before that, China had such a level of relations only with Great Britain, Pakistan, and Russia. In 2016, Belarus found itself in such a club.

It is interesting that such an intensification of bilateral relations, both economic and political, falls on the period after 2014, just with the beginning of the Russian-Ukrainian military conflict. The fact is that China initially planned to include Ukraine in the Belt and Road Initiative as its Eastern European logistics and industrial hub. The main goal for the Chinese is to reach the European market through Ukraine. Beijing was well aware that Kyiv was negotiating an association with the European Union with a free trade zone. But the annexation of Crimea by Russia and the destabilization in the Donbas forced the Chinese to abandon these plans and shift their strategic attention to Belarus.

- This is also the time of improving relations with the European Union.

- That's right. Just in 2015, the head of the People's Republic of China Xi Jinping paid a state visit to Belarus, who said that our country was becoming the main Eastern European hub of the Belt and Road Initiative. The Belarusian authorities, in turn, pledged to create all the necessary conditions for Chinese companies and corporations to gain free access to the European market. From that moment on, the activity of restoring the work of the Great Stone Belarusian-Chinese industrial park is gaining momentum. Let me remind you that it was laid by Lukashenka and Xi Jinping back in 2010 when the latter was the deputy head of the PRC. But, for a long time, no residents were registered there, there were no Chinese companies. Only in 2015, after Western countries began to lift and suspend sanctions against Belarus, this prompted Chinese companies to invest in the Great Stone.

This process developed dynamically until the political crisis of 2020, which seriously aggravated the domestic and foreign policy situation around Belarus and also led to the restoration of sanctions policy by Western countries. For China, the situation is repeated in 2011-2015, when sanctions already existed and they created additional risks for Chinese companies. Even then they restrained themselves from registering in Belarus and from economic activity, now we are witnessing the same process.

- Can you see it now?

- Yes, it is being observed.

At the level of rhetoric, China supports the Belarusian authorities, but we need to look deeper. China is now rethinking its strategy towards Belarus and the region; it is returning to the idea of working through Ukraine. Now Belarus and Ukraine seem to have reversed their roles. Today Belarus is more associated with economic and political risks than Ukraine, which managed to launch an association agreement with the European Union. Thus, China can gain access to European markets through Kyiv. The military-political situation in Ukraine has also stabilized. The risks of a major war between Russia and Ukraine have significantly decreased.

- Is it correct to say that Belarus is interesting to China primarily as an outlet to Europe?

- Yes, indeed. Moreover, Chinese experts who have visited Belarus over the past years advised Minsk on two things to improve its internal business and climate, as well as diversify the economy: to enter the World Trade Organization and sign an economic agreement with the European Union. Perhaps, under the influence of these recommendations, these goals were included in the program of socio-economic development for 2016-2020.

- A rather unexpected thought that China was interested in a deeper presence of our country in Europe.

- In fact, China pushed Belarus to deeper trade and economic ties with Europe. After all, China sees the EU market as one of the most promising. If you look at China's strategy, they came with investments in those countries of Eastern and Central Europe that have deep institutional relations with the EU. Whether there are agreements on deep cooperation and partnership, or a regime of access to the system of preferences, as was the case in Armenia, or EU membership in the future.

- In connection with the current crisis, can it be said that the development of Belarusian-Chinese relations has been paused?

- It can. Here we repeat the cycle that took place in 2011-2015 when Belarus was in foreign policy isolation from the European countries. The fact is that the strategic culture of China allows for a long pause, and, depending on the dynamics, it is very flexible to adapt the strategy.

It should be understood that China is primarily promoting its national interests. The main goal of the Belt and Road Initiative is the access of Chinese goods to the European market. Those countries that do not have deep ties to the European market risk falling out of China's attention. In fact, unfortunately, this is now happening in Belarus due to the dramatic consequences of the 2020 crisis. Everything now depends on the Belarusian side, if they still manage to fulfill the obligations they made in 2015, this could change Beijing's attitude towards Belarus and return us to the PRC agenda.

Now we are in a situation where we have to compete for Chinese investments with other countries in the region. That unprecedentedly high level of relations with China, which Belarus has reached in a short time, does not guarantee anything. It only provides opportunities that can be used to solve the problems of reforming the Belarusian economy.

Interestingly, the advice of Chinese experts usually coincides 80-90% with the advice given to Belarus by international financial institutions. The ball is on the side of the Belarusian authorities, now everything depends on how Lukashenka will solve the political crisis. If it meets the expectations of both Western countries and China, it could lead to a more intense relationship with Beijing.

- The support of the Belarusian authorities from Beijing seems to be more symbolic than real so far. Is this true?

- Indeed, China primarily supports the Belarusian authorities at the level of rhetoric. When it comes to financial support, it looks vague. It also shows us that China will not spend. In the situation with Ukraine in 2013, when Viktor Yanukovych requested a loan of $ 15 billion during his visit to Beijing, China set a condition: the mandatory signing of an association agreement and the creation of a free trade zone with the European Union. In such circumstances, China was ready to provide a loan. Interestingly, this visit took place after the Vilnius summit of the Eastern Partnership, where Yanukovych refused to sign these documents.

Beijing, if it helps, will set certain conditions for the authorities if they have to stabilize the situation inside the country and restart relations with the European Union. Then it really makes sense for China to invest in Belarus so as not to lose their investments. There are examples when China invested a lot, like in Venezuela, but after the country was under sanctions, China did not know what to do. After all, it cannot withdraw everything, but there is no way to develop opportunities because of the risk of secondary sanctions from the United States. Now such risks also exist in Belarus for Chinese companies. China will not risk its own interests in order to simply support the Belarusian side through a common ideology or personal chemistry between the leaders of the countries.