Key interests of Belarus in the Caspian region: goods and services export build-up

According to Alexander Lukashenko, the President of Belarus, «our country does not have geopolitical ambitions, but we should advance our national interests at every possible way, backed by both our own resources and cooperation with the friendly states». [1]

In this sense it should be noted that the President had in mind not only economic cooperation, which is the quintessence of the so-called «multi-vector» policy of official Minsk, but also about political, as well as military and technical collaboration. It should be emphasized that being the country with open export-oriented economy Belarus sells about 65% of all its domestically manufactured products in the international markets. As for political and military aspects, the important condition for successful cooperation in these spheres is the political capacity and sovereignty of that or another state with respect to «collective West» exercising the sanctions-based pressure against Belarus starting from mid-90s accompanied by ongoing attempts to interfere with the internal affairs of the country and to provoke political instability in order to overthrow the constitutional order.

Within the framework of implementing this strategy, the West for a quarter of the century has already been trying to establish the conditions for international isolation of Belarus, sometimes giving the appearance of «thawing in relations» and «dialogue» in order to create «the entry points» for penetrating the public and political environment of the Belorussian state. The situation became more acute after presidential elections of 2020, when the political counterparties of the EU, the USA and the UK with the active support by these countries undertook an unsuccessful, but the most massive attempt of a hybrid coup d’état. Additional escalation took place with the start of the special military operation of the Russian Federation in Ukraine, when Minsk took a stand in favor of Moscow in accordance with its obligations under the respective agreements. This resulted in introducing the strongest ever in history sanctions against Belarus covering entire sectors of the national economy, while the neighboring countries – the Baltic states, Poland and Ukraine are exercising air and trade blockade of the Belorussian state.

At the same time, despite the international isolation attempts, Minsk succeeded in building adequate mutually beneficial relations with many countries across the world. The Caspian Sea region holds an important position in the system of Belorussian foreign policy; in general, the countries of this region are friendly to official Minsk and are extremely promising from the standpoint of the key interests for promoting goods and services export.

Special importance of Azerbaijan

Azerbaijan deserves a special place among the Caspian countries in this regard. It is necessary to highlight that Baku and Minsk have been connected with traditionally warm relations for many years based on personal friendship between the heads of states Ilham Aliyev and Alexander Lukashenko. Based on the above, it is quite natural that both parties do their best to convert the high level of political interaction and mutual trust into specific economic results, scientific and technical cooperation projects, industrial cooperation and the growth of mutual trade.

Characterizing the interaction between Belarus and Azerbaijan, President A. Lukashenko said: «We have brilliant relations. And I am always proud of this. We restored the warmest relations back from the Soviet times practically in all areas». In his turn, President I. Aliyev believes the relations between Baku and Minsk to be absolutely free of any problems and cooperation with Belarus going in all areas: both in political and economic spheres. 

In 2021 the record-high results were achieved in collaboration of Belarus with Azerbaijan: trade turnover of USD 885 mln, comprising export from Belarus for approximately USD 480 mln. To compare: in 2020, these indicators were USD 447 and 190 mln, in 2015 – USD 290 and 285 mln, in 2012 – USD 223 and 211 mln respectively. [2]

In assessing the dynamics of trade and economic cooperation development the following fact can draw special attention: Azerbaijan practically succeeded in equalizing the positive balance of bilateral trade, even though initially export from Azerbaijan to Belarus looked pretty modest and did not exceed USD 5-15 mln. As for 2022, it exceeded USD 400 mln, consisting mainly of petroleum products and agricultural products.

Starting from 2017, Azerbaijan Trading House has been operating in Minsk, and in Azerbaijan a network of Belorussian branded shops has been growing. Hence, the bilateral trade and economic cooperation between Baku and Belarus is intensively developing, it is mutually beneficial for both countries and is becoming even more important in the context of the tough sanctions imposed by the collective West and of the attempts for trade, economic and technological blockade of Belarus.

On 18-19 May 2022, Roman Golovchenko, the Prime Minister of the Republic of Belarus, paid an official visit to Azerbaijan and held negotiations with his Azeri counterpart Ali Asadov. The visit was focused on searching for new opportunities to increase mutual trade turnover.

Belorussian Prime Minister was especially focused on food security in the context of the global food supplies crisis, he offered a series of projects targeted at increasing the export of meat and dairy products from Belarus to Azerbaijan, as well as the import of fruit and vegetables from Azerbaijan into the Belorussian market. Overall, during the two-day visit of Golovchenko to Azerbaijan, export contracts were signed for approximately USD 70 mln pertaining not only to food, but also to cooperation in timber trade, supplying items made of glass and crystal.

It seems important to emphasize that the Republic of Belarus is an absolute leader among the CIS countries in per capita production of meat and milk, and both physical and cash indicators in this sector demonstrate year-on-year growth. Despite the Western sanction, the Q1 2022 food producing results constituted 111% vs. the similar period of the preceding year, which is equal to USD 2.2 bn. Hence, official Minsk logically views the enhancement of food supplies from Belarus to Azerbaijan as a potential «growth point» in the context of the current objectives of increasing the bilateral trade turnover and Belorussian export.

Another important outcome of the visit was the contract for Minsk Tractor Plant to supply tractor packages for USD 15 mln for further assembly at Ganja Auto Plant. This plant is undoubtful leader of the industrial cooperation between Belarus and Azerbaijan. Starting from 2007 until now, about 12 thousand Belarus tractors of different modifications, as well as special-purpose tractor-based vehicles were assembled in Azerbaijan, as well as 4 thousand trucks of Belorussian brands, electric battery buses and grain harvesters. Hence, we are talking here not just about exporting the products of Belorussian mechanical engineering industry to Azerbaijan, but about technology transfer as well contributing to integration of design and engineering schools of the two countries.

Kazakhstan

The high level of Belarus-Kazakhstan relations is underpinned both by the fact that these two countries are members of CIS, EAEU and CSTO, and by the significant contribution of Belarus President A. Lukashenko and the first Kazakhstan President N. Nazarbayev, who were pursuing the policy of strengthening the bilateral interaction for many years.

At present, the legal framework of Belarus-Kazakhstan cooperation comprises over 80 international agreements covering practically all the spheres of inter-state collaboration. The key one is inter-state Social and Economic Cooperation Agreement effective until 2026. [3] In accordance with the existing legal framework, Belarus and Kazakhstan are engaged in political dialogue, interaction in defense and law enforcement spheres, economic and humanitarian cooperation, as well as cooperation in research and technology.

The alliance of the two countries in defense and law enforcement spheres, as well as participation of Nur-Sultan and Minsk in the Collective Security Treaty Organization allowed Belarus to provide the necessary aid to Kazakhstan in localizing the consequences of the violent civil unrest in January 2022 and to send the limited contingent of peacekeeping troops within the CSTO forces to assist the Kazakhstan leadership in restoration of peace and justice in the country. Prevention of the coup d’état in Kazakhstan was not only the test of strength of the collective security mechanisms created within the CSTO framework, but promoted stronger trust in Belarus-Kazakhstan relations, the extension of direct meaningful top-level dialogue between Kassym-Jomart Tokayev and Alexander Lukashenko.

As for the trade and economic relations, it should be noted that in terms of Belorussian export, Kazakhstan belong to the top-10 major trade and economic partners of the Republic of Belarus. In 2021, the turnover made USD 1,092.5 mln, i.e., 31.9% growth versus 2020, export made USD 911.8 mln, i.e., 25% growth, import – USD 180.7 mln, 82.7% growth. The trade balance is positive – USD 731.1 mln.  [4]

Hence, Kazakhstan is an important political and economic ally for Belarus, the relations between the two countries are regulated by both bilateral partnership agreements and by integration commitments within EAEU and CIS. Minsk and Nur-Sultan are coordinating their policies in the sphere of security, their alliance in defense and law enforcement is underpinned by participation in CSTO.

At the same time, Belarus still has certain concerns with respect to the ongoing attempts by the «collective West» to adversely influence the policy of Kazakhstan with the purpose of distancing that country from the alliance with Moscow and Minsk. The «neutral» position of Kazakhstan leadership with respect to the special military operation of the Russian Federation in Ukraine is nothing but perplexing, as well as the position of Kazakhstan during the vote in the UN and other international organizations on «condemnation» of the actions by Russia and Belarus. Such inconsistency of Nur-Sultan on the fundamentals of domestic and foreign policy along with numerous Kazakhstan NGOs with foreign funding, the signs of extremism, nationalism and the remaining not fully annihilated Islamist underground create the threat of repetition of the destabilization scenario in this country, which may require significantly more resources and efforts than in January 2021.

Iran

Development of bilateral relations with Iran is also one of the priorities for official Minsk. Multi-year pressing on behalf of the «collective West», the US mainly, political and economic sanctions, the attempts of blockade in science and technology sphere and artificial limitations in development – these challenges are common for both Minsk and Teheran, and they nothing but incentives for the policy-makers of the two countries to closer interaction in many spheres.

At the same time, Belarus displays serious interest in studying the successful Iranian experience of counteracting the sanctions-based pressure. On top of that, both countries are actively cooperating in the international arena supporting each other in UNESCO, UN Human Rights Council, UNECOSOS, Universal Postal Union and other organizations. It is worth to remember that the legal framework of the bilateral cooperation comprises more than 30 inter-state and inter-agency agreements.

Nevertheless, with respect to high level political contacts a rather long pause is observed in organizing mutual visits. Overall, two visits of the President of the Republic of Belarus to Iran (in 1998 and 2006) and two visits of the President of Iran to Belarus (in 2004 and 2007) took place during the entire history of the relations between the two countries. However, on 16 September 2021, on the sidelines of the SCO summit in Dushanbe the leaders of Belarus and Iran Alexander Lukashenko and Ebrahim Raisi held negotiations. [5]

Today the trade and economic cooperation looks rather modest. As of the end of 2021, the trade turnover between Iran and Belarus made only USD 33.28 mln. At the same time, it is evident that such minor indicators do not reflect the entire potential of the economic interaction of the two countries, because in 2017, they achieved the level of USD 150 mln, and the capacity seems to be much higher.

Hence, the bilateral contacts between Belarus and Iran, especially at the top level and between high-ranking officials, appear to need intensification considering the current international situation and common interests of Teheran and Minsk. The enhancement of political interaction between Belarus and Iran requires the reset of trade and economic relations, the level of which currently does not correspond with the potential of both countries. A certain limiting factor in this case is the intent of Belarus to develop cooperation with other countries of the Arab world, which, in their turn, have certain friction in their relations with Iran.

Turkmenistan

Until recently, the relations between Belarus and Turkmenistan displayed high dynamics of political contacts. The President of Turkmenistan visited Belarus 4 times during the recent 20 years, and Alexander Lukashenko visited Turkmenistan 7 times. It was believed that such intensity of top-level contacts was explained by some «special model of bilateral relations, when the Presidents exchange official visits on an annual basis to control the implementation of the achieved agreements».

In 2012, when receiving Gurbanguly Berdimuhamedov (then the President of Turkmenistan) in Minsk, Alexander Lukashenko called the guest his «personal friend and the friend of Belorussian people» emphasizing that all other things being equal, the Turkmen party «always prefers the Byelorussians». [6] It is necessary to emphasize that such political contacts dynamics and trustful communication between the leaders of the two states allowed for achieving rather high economic results: in 2008 the trade turnover made USD 49 mln, in 2011 it already was USD 238 mln, and in 2013 – USD 320 mln.

In addition, Belarus was admitted to participation in implementing a series of meaningful state programs of Turkmenistan including the construction of mining and beneficiation complex producing 1.4 mln t per annum of potash fertilizers based on Garlyk deposit of potassium salts. The ceremonial opening of this complex took place in 2017 in the presence of both Presidents – A. Lukashenko and G. Berdimuhamedow.

Thanks to the agreements signed at the top level, starting from 2009, Belarus supplied about 6 thousand MTZ tractors and over 10 thousand MAZ trucks.

However, a sharp decline of the trade turnover between the two countries may be observed in the recent years: USD 65.1 mln in 2017, USD 32.2 mln in 2018, and finally – USD 20.8 mln in 2021, which is an absolute abysmal record for the last 15 years.

The current situation may be explained by a number of factors including a series of unsettled business disputes between Ashkhabad and Minsk after completion of Garlyk mining and beneficiation complex construction resulting in certain cooling of bilateral relations.

Hence, over the last 10 years, the relations between Belarus and Turkmenistan transformed from strategically important cooperation to the situation when immediate corrective action is required. At the same time, official Minsk welcomed the transit of power in Turkmenistan and the new President Serdar Berdimuhamedow coming into office, because it allows for restoration of the previous trustful cooperation subject to both parties quickly finding the positive settlement of the existing business disputes.