China’s growing influence in Belarus through its Belt & Road Initiative could be derailed as mass demonstrations triggered by a disputed presidential election grip the Eastern European country, analysts say.

President Alexander Lukashenko claimed a sixth consecutive term on August 9 amid widespread allegations of election fraud, sparking anti-government protests
across the country and creating fresh uncertainty for China’s investments.

“If we do see a change of government towards the opposition that would potentially cause a problem for Belt & Road projects there, especially if the next government begins to tilt more towards the West,” said Marc Lanteigne, associate professor of political science at the University of Tromsø, Norway.

China’s economic presence in Belarus has grown in recent years as it looks to increase its influence throughout Eurasia and Lukashenko has sought a closer relationship with Beijing to offset a historical dependence on Russia.

Belarus is an important component of the Belt & Road [Initiative] … It is seen by China as a potential outlet to the Baltic states and to Eastern Europe

Marc Lanteigne

President Xi Jinping was among the first to congratulate Lukashenko who is known as the “last dictator in Europe” while state media have largely been muted over the political turmoil that has roiled its strategic partner.

“Belarus is an important component of the Belt & Road [Initiative] … It is seen by China as a potential outlet to the Baltic states and to Eastern Europe,” said Lanteigne. “China was very active in engaging with the government of Belarus in projects that would eventually be folded into the [plan].”

Among the most important Chinese investments is the Great Stone Industrial Park, located 25km from the capital Minsk. Construction on the US$2 billion hi-tech industrial projects started in 2014 and has been described by Xi as “a pearl” on the overland Silk Road Economic Belt.

China’s total foreign direct investment in Belarus grew to US$450.3 million in 2019, according to the National Bank of the Republic of Belarus, substantially lower than the country’s main trade partner Russia, which spent US$4.5 billion.

But in 2016, China agreed to lend US$7 billion to Belarus through credit lines, according to the Ministry of Commerce.

Lukashenko, who has been in power for 26 years, is one of the most vocal supporters of the Belt & Road strategy among European leaders and has overseen a surge in trade with China.

Last year bilateral trade turnover was US$2.7 billion, up 58 per cent on 2018, with Chinese exports to Belarus valued at US$1.8 billion, according to China’s Foreign Ministry. China is Belarus’ fourth-largest trade partner after Russia, the European Union and Ukraine.

Analysts said Lukashenko has pivoted towards China to try to assert independence in the face of extortionate terms of trade from Russia, though this has not always been successful. Belarus has relied on cheap Russian energy and loans to maintain its Soviet-style economy, but Moscow has demanded Minsk accept closer economic integration.

Belarus has deliberately looked to China to provide an alternative to dependence on Russia

Keir Giles

“For most of his presidency, Lukashenko has managed a balancing act between Russia and other partners, trying to remain independent,” said Keir Giles, a senior consulting fellow at the Russia and Eurasia Programme at London-based Chatham House.

For Minsk, Beijing is a less threatening investment partner because money from China is less likely to be leveraged into encroachments on sovereignty, Giles added.

Madina Khrustaleva, an analyst with London-based research firm TS Lombard, said China’s investment in many ex-Soviet states such as Belarus could be seen as an attempt to grow its influence in what was traditionally Russia’s backyard.

But the ongoing turmoil in Belarus might put Chinese investment in the country on hold, she added.

“Protests will affect all investments in Belarus in another way – the longer the all-country strikes will go the longer all investments will be paused. So far it is a political crisis and not a civil war yet,” Khrustaleva said.

Analysts said Russia is wary of losing Belarus to the West and Minsk’s ties with Beijing could still be damaged if Moscow decides to intervene. Russia’s president Vladimir Putin has warned Europe not to interfere.

“If Russia does succeed in one way or another installing a more compliant client regime there, it can be expected that cooperation with China will be rolled back,” Giles added.

Author: Amanda Lee
Editor’s note: The article reflects the author’s opinion only, and not necessarily the views of editorial opinion of Belt & Road News.