News & Analysis

Russia ties Belarus loan to further integration

The Eurasian Fund for Stabilisation and Development (EFSD), a Russian-managed fund established by the Eurasian Development Bank, has refused to provide Belarus with the last, seventh tranche of a two billion US dollars loan, the Belarusian press has reported.

According to the EFSD discussion of the tranche, worth 200 million US dollars, “has no legal basis” since the period of availability for the financial loan expired on June 30 and the Belarusian finance ministry did not contact the fund for a further extension.

“Work is currently underway on a programme to deepen integration with Russia. Only after its signing is the Russian side ready to move on to the discussion of other issues, including those related to the financing of Belarus,” wrote Belsat TV, quoting an unnamed financial source of Belarusian news agency BelaPAN.

The Belarusian media also reported that the Russian government had similarly tied compensation for Belarusian losses linked to the taxation of imported Russian to political integration.

Earlier this year, the Belarusian finance minister, Maxim Yermolovich, said that Anton Siluanov, his Russian counterpart, also decided to withhold a loan of 630 million US dollars unless Belarus reaches a “general integration mechanism” with Russia.

On September 16, leaked documents revealed that Belarus and Russia had prepared an interstate programme that includes a wide range of economic integration. The two governments have been in talks for months discussing integration within the framework of the so-called Union State Treaty. The aim of the Russian initiative is reportedly to keep Russian President Vladimir Putin in office after his last, constitutionally permitted term ends in 2024.

Photo: Eurasia TX