Lukashenko has prepared a surprise for Ukraine

Written by The Frontier Post

Valery Mikhailov

The Belarusian government adopted a resolution “On lic-ensing the import of certain types of goods”, ac-cording to which the im-port of a number of goods of Ukrainian origin will be made under one-time lic-enses. According to the preamble of the docum-ent, this was done in connection with the systematic violation of the principles of free trade by Ukraine.
The restrictions included 36 commodity items, the total volume of exports of which from Ukraine to Belarus in 2020 amounted to $ 114 million, according to Ukrainian customs statistics. Or ten percent of Ukrainian merchandise exports to this country. The restrictions are imposed for six months. The new decree is just a continuation of the Ukrainian-Belarusian trade war, which was initiated by Ukraine this spring.
The conflict was preceded by several years of idyll in trade relations between the countries, during which Belarus became the main s-upplier of oil products, inc-luding aviation fuel, and f-ertilizers to Ukraine, and t-ook a significant share in t-he Ukrainian markets for municipal transport and trucks. Ukraine, in turn, used Belarus, clearly with the knowledge of the state authorities, to import into Russia a number of prohibited Ukrainian goods under the guise of Belarusian-m-ade goods. In particular, commercial and electrical equipment, agricultural eq-uipment, components for railway equipment and the like. Sharp contradictions between Ukraine and Belarus’ ally – Russia – surprisingly did not prevent the two countries from developing military-technical cooperation: MAZ vehicle kits supplied to Ukraine went to the Ukrainian army under the Bogdan brand. Belarus also helped Ukraine with deliveries of diesel engines from the Yaroslavl Motor Plant, inaccessible to Kiev, batteries for military equipment, a number of components (for example, guidance systems, thermal imagers and night vision devices), and so on.
Finally, in recent years, Belarus has been a hub for flights from Moscow to Kiev and back, on which it earned good money. Neither the elections in Belarus, the results of which official Kiev recognized, staying in the wake of the policy of “Western partners”, nor the muddy story with the so-called Wagnerists, from which Vladimir Zelensky still unpleasantly hiccups, did not spoil trade relations.
And suddenly, in April of this year, Kiev introduced special duties of 35 percent on Belarusian buses, trucks and special vehicles. Moreover, he did it so clumsy and illiterate that the Belarusian suppliers almost immediately after the decision on the introduction of these duties was issued blocked them in court until the issue of their legality was considered in essence. This is probably why the official Minsk did not react to the attack. But after Kiev was the first of all countries to officially announce the termination of flights with Belarus due to the alleged forced landing of a Ryanair aircraft in Minsk, the Belarusian leadership reacted immediately. It accused Kiev of violating the principles of free trade and introduced a one-time licensing for 32 Ukrainian goods.
In most cases, this meant a de facto ban on their import into Belarus, even in the absence of a legal ban. Deliveries from Ukraine of chocolate and other confectionery, beer, toilet paper, a number of types of cardboard packaging, wallpaper, washing machines and some types of furniture have practically ceased. The imports of the rest of the goods included in the list decreased significantly.
By about the fall, Ukrainian lobbyists, using their own connections in Belarus, agreed on indulgences: suppliers of certain types of goods that had previously fallen under the de facto import ban began to receive import licenses without hindrance. In particular, for agricultural machinery, ceramic tiles, vegetable and fruit juices, fibreboards. Nevertheless, even the effect of the restrictions for less than seven months and in a mode that is sparing for some commodity items will lead by the end of the year to a reduction in Ukrainian supplies by about $ 45 million – and this is in comparison with the unsuccessful pandemic 2020. But the Belarusian producers did not suffer losses from the special duties, since in the summer they achieved in the Ukrainian court the recognition of the decision on the introduction of special duties as illegal. By the way, recently the Ukrainian authorities also formally canceled this decision. Perhaps, hoping that the Belarusian side will also not extend the restrictions on Ukrainian goods.
But it was not there. The restrictions were extended, and the list of goods was e-ven slightly expanded. Tr-ue, juices were excluded fr-om it, but several types of sweet dry biscuits and cer-amic plumbing were added.
The trade balance betw-een Ukraine and Belarus is consistently negative. Sim-ply due to the fact that Be-larus has retained its industry and can supply Ukraine with the aforementioned oil products (for which Ukraine is generally strictly dependent on Minsk, which provides about 40 percent of the balance of local consumption) and fertilizers, buses and trucks, household appliances and tractors.
It is much more difficult for Ukraine to offer something to Belarus. Moreover, from year to year, the imbalance in trade between the countries is becoming more and more negative for Kiev. Following the results of 11 months of this year, Ukraine’s deficit in trade with Belarus reached a record $ 2.9 billion. Moreover, the actual Ukrainian export amounted to only $ 1.35 billion.
Of course, the Belarusian restrictions will not nullify the Ukrainian economy, but they will cost it $ 50 million annually. The main problem is that there are more and more markets in which Ukraine is only losing (some stupidly, as in the case of Russia or Belarus, where due to its dependence, as in the case of “Western partners”), there are more and more. And the Ukrainian economy has less and less opportunities.

About the author

The Frontier Post