CEWEEKLY_112

8/6/2019 CEWEEKLY_112

1/8

CENTRAL EUROPEAwEEkLANALyTICAL NEwSLETTER FOR CENTRAL EUROPE, GERMANy, THE BALkANS & ORODEk STUDIw wSCHODNICH IM. MARkA kARPIA | CENTRE FOR EASTERN STUDIES| ISSUE 15(112) | 20.04.20

Ins ide :

C E N T R A L

E U R O P E A N

w E E k L y

A n a

l

t i c a

l N e s

l e

t t e r

f o r

C e n

t r a

l E u r o p e

, G e r m a n

, t h e

B a

l a n s

&

t h e

B a

l t i c

S t a

t e s

C e n

t r e

f o r

E a s

t e r n

S t u

d i e s

os . a .plANALySES

Arturas Zuokas re-elected as the mayor of Vilnius.Poles outside the coalition in the capital / 2The escalation of the conflict between the conservatives/Christian demo-crats-EAPL has made it easier for Arturas Zuokas to return to the position

of mayor of Vilnius whereas the two conflicting parties go into opposition

EvENTS

Romania: the government is consistent in introducing sociallyunpopular reforms / 6

An early parliamentary electionhas been declared in Macedonia / 7

Bosnia and Herzegovina: another power struggle betweenthe High Representative and Serbian politicians / 7

German parties divided over the issueof financing the EU budget / 8

We recommend our publicationswhich can be found at the OSW

website osw.waw.pl

On t v o c ? Mount nconom c p ob m n B u

The fragile reseT.T b nc nd t p o p ct

o c n n ru n-Us t on

CENTRAL EUROPEA

1O S W. WAW. P L O S W

C O M M E N T A R y

O r o

d e

k

S t u

d i w

W s c

h o

d n

i c

h

C e n

t r e

f o r

E a s

t e r n

S t u

d i e s

O S W

C O M M E N T A R y

O r o

d e

k

S t u

d i w

W s c

h o

d n

i c

h

COMMENTARy OSWi S S u E 5 1 | 0 6 . 0 4 . 2 0 1 1 | C E N T R E f O R E A S T E R N S T u d i E S

On the verge of crisis?Mounting economic problems in Belarus

Kamil Kysiski

Belaruss financial condition has visibly worsened since the beginning ofthis year. The severe falls in the countrys foreign currency reserves and itsshortage of foreign currency on the international market pose an increasingthreat to the stability of the Belarusian economy. Fearing an outbreak ofpublic dissatisfaction, The government has so far been trying to avoid de-valuing the rouble or structural economic reforms. Maintaining full controlinside the country and the stability of the authoritarian regime are stillthe main concerns for President Alyaksandr Lukashenka. For this reason,the actions taken by the Belarusian government have been limited to impo-sing short-term administrative restrictions on the foreign currency marketand obtaining external support in the form of loans. Given Belaruss fallingcreditworthiness, Minsk is only able to ask Russia for financial support,thus offering the Kremlin more opportunities to realise its desire to takeover strategic industrial plants in Belarus. However, the present economicproblems of Belarus are so serious that no loan will be able to safeguard itsgovernment from the need of carrying out serious economic reforms.

The special features of t he Belarusian economic model

Belaruss economy is based on thecommand-and-distribution governancemodel inheritedfrom the Soviet period. This involves management by means of the centralplanning ofexports,imports, investments,production modernisation,etc. As a result,the Belarusianeconomy is particularly inflexibleand inefficient in comparison to the neighbouringcoun-tries economies,where free-market rules apply (albeit to various extents).At the sametime,since a significant part of its industry is export-oriented,it is very vulnerableto thechangingsituation on theglobalmarket. Theoperation of theBelarusian economic modelhas longbeen based on Russian cheap energy and tradesubsidies.Thanks to loweroilandgas prices,Belarus was ableto generatesignificant revenues (forexample,from exports ofoilproducts (mainly to theEU and theUSA), which enabled it to support theinefficient

branches of its economy and financeits extensivesocialwelfare system.Moreover,accessto theRussian market on preferentialconditions guaranteed many Belarusian firms,espe-cially in themachine-buildingand food sectors,high levelof exports fortheir goods (whichwould berather uncompetitiveon Western markets). Thus theindustrialproduction rosecontinually and leveraged high economic growth,which ranged between 7 and 9percentoverthe past decade.

O S W. WAW. P LO S W. WAW. P L

29

KRUCHY RESET.

Bilans i perspektywy przemianw relacjach rosyjsko-ameryka skich

THE FRAGILE RESET.The balance and the prospects

for changes in Russian-US relations

Marcin Kaczmarski

O RODEK STUDIW WSCHODNICHIM . MARKA KA R P I ACENTRE FOR EASTERN STUDI ES

P O L I C Y B R I E F SPUNKTWIDZENIA

r k tu i c h ni ch im. rk K r iC n tr f r E t r n tu iul . K k , r / rt l . / h n : + / /

T HE F I LE E E T . Th l nc n th r ctf r ch n in u i n- r l t i n

T lici l i i c l ,

i i c ic i . Ti : ic l, i l

l l c l i ici il c i l

c lic, i c-c ll 1 . I ,

i i ii l i I i c ii ,

l i i i , c ii li i

. c li i- ic ic.

T c ic k l ci i - l i l .T i l ii x l , i i il

c , i cc i c l .

K H E E T .il n i r kt r mi nr l c j ch r j k - m r k kich

li k i i k ci -

li c c , i c i c c . i c lic l :

k li ; c i il i c i l

icci ki l c i c c ;ci c i i i c il

c kl . i ii li c ci

i i k i kic c i i i

k ii ici l ki . -

i l k k kk . i , ki

i l c c k- k kic ,i c k . I i c

k i ii . k

ci ki , ic cic k c c .

2011kwiecieApril

8/6/2019 CEWEEKLY_112

2/8

8/6/2019 CEWEEKLY_112

3/8

BACkA N A Ly T I C A L N E w S L E T T E RI S S U E 1 5 ( 11 2 ) , 2 0 A P R I L 2 0 11C E N T R E F O R E A S T E R N S T U D I E SCEwEEkLy

C E N T R A L

E U R O P E A

N

w E E k L y

A n a

l

t i c a

l N e s

l e

t t e r

f o r

C e n

t r a

l E u r o p e

, G e r m a n

, t h e

B a

l a n s

&

t h e

B a

l t i c

S t a

t e s

O r o

d e

S t u

d i

w s c

h o

d n

i c

h

C e n

t r e

f o r E

a s

t e r n

S t u

d i e s

a n a l y s e s 3

wing. Activities undertaken by Tomaszewski, a representative of the Polishminority in the Lithuanian delegation in the European Parliament, constitutea problem for Lithuanian political elites. Tomaszewski is actively involved, bothin Lithuania and outside its borders, in winning support for the Polish minority

in order to prevent a violation of its rights and diminishing them by subse-quent Lithuanian governments.The right-wing party of the outgoing mayor of Vilnius Raimundas Alekna(conservatives/Christian democrats) came in only third in the local elections.Alekna is considered by the citizens of Vilnius and council members from EAPLa good local authorities official but lacking in the political charisma that Zuokas has.

T tu n o t cont ov m yo Zuok

Relations between the major parties which won the elections in the capitalare full of tension. Tomaszewski evski, in conflict with politicians of the rulingright and often referring to Christian values, condemned the unethical behav-iour of Zuokas and his style of ruling in the capital that consisted in takingcare of the specific interests of business circles. Also conservatives/Christiandemocrats distance themselves from Zuokas. It was the Labour Party thathad the casting vote as on the day of the vote it handed over its votes toZuokas despite the fact that Uspaskich also criticised the former mayor.Equally, the Social Democratic Party and two representatives of the RussianAlliance (this party ran in a bloc with EAPL in the elections) gave supportto Zuokas. After having heard accusations of representing the interests ofeconomic circles Zuokas will rule under heavy pressure from public opinion.

His actions will also be observed by the conservatives/Christian democratswho will likely use every opportunity to discredit him and attempt to take overpower in the capital. In order to maintain his present support, Zuokas willalso have to share part of his real power with the Labour Party and the SocialDemocratic Party now he has offered the positions of two vice mayors tothe two parties, the third position of vice mayor remains unseated, whichproves that Zuokas will seek to strengthen his coalition by incorporating intoit another partner for whom he has reserved this position. He has put forwardhis offer again to conservatives/Christian democrats and EAPL.

a n t t b ckd op o t V n u m yo ct ont n v t d con ct b tw nt Po m no ty nd t u n t

The failure of Alekna was sealed not only by the decision of Uspaskichs party toback Zuokas but also by EAPL putting forward their candidate for the electionsdespite the lack of chances for gaining support for him from any of the par-ties represented in the municipal council. Although an alliance between EAPLand theconservatives/Christian democrats, seemed possible (a representativeof EAPL was vice mayor under Alekna), it could be now difficult to accept bya section of voters of both the parties which are clearly mobilising their elector-

ates before the parliamentary election scheduled for autumn 2012. Particularlyvocal in their protests against such an alliance was part of the nationalists whoare members of the party of the conservatives/Christian democrats.

8/6/2019 CEWEEKLY_112

4/8

8/6/2019 CEWEEKLY_112

5/8


C E N T R A L

E U R O P E A

N

w E E k L y

A n a

l

t i c a

l N e s

l e

t t e r

f o r

C e n

t r a

l E u r o p e

, G e r m a n

, t h e

B a

l a n s

&

t h e

B a

l t i c

S t a

t e s

O r o

d e

S t u

d i

w s c

h o

d n

i c

h

C e n

t r e

f o r E

a s

t e r n

S t u

d i e s

a n a l y s e s 5

as in Lithuanian schools. EAPL, which by withdrawing from the alliance withthe conservatives/Christian democrats has facilitated the return to powerof Zuokas, still has the possibility of negotiating about its entry into the coali-tion that is now being formed by the mayor and taking the vacant position

of the third vice mayor. Joanna Hyndle

8/6/2019 CEWEEKLY_112

6/8

8/6/2019 CEWEEKLY_112

7/8


C E N T R A L

E U R O P E A

N

w E E k L y

A n a

l

t i c a

l N e s

l e

t t e r

f o r

C e n

t r a

l E u r o p e

, G e r m a n

, t h e

B a

l a n s

&

t h e

B a

l t i c

S t a

t e s

O r o

d e

S t u

d i

w s c

h o

d n

i c

h

C e n

t r e

f o r E

a s

t e r n

S t u

d i e s

e v e n t s 7

an y p m nt y ct on b n d c d n M c don

On 15 ap t M c don n p m nt d c d d to d o v t w t

vot om t u n t-w n p ty VMrO-DPMNe nd t a b n np t . an y p m nt y ct on w b o n d on 5 Jun .T u n co t on op t t v y k y v cto y n t ct on w

m oc uppo t o t ov nm nt po c w c v b nv y c t c d by t oppo t on p t w o now boycott n t

wo k n o p m nt.

The main reason for deciding on an early election is the boycott of parliamentby the largest opposition party the Social Democratic Union of Macedoniathat has been underway since January this year. The party is accusing the gov-ernment of limiting civil liberties and blames it for the deteriorating economicsituation. The target for criticism is the intransigent policy towards Greece andthe lack of a solution to the dispute between the two countries, which resultsin blocking Macedonias membership in the NATO and the launch of acces-sion negotiations between Skopje and the EU.The negotiations undertaken by the government aimed at persuading the op-position to return to parliament have not brought any results and the protract-ed boycott has been negatively assessed by EU institutions and EU memberstates. This would affect the assessment of Macedonias preparedness forEU membership and consequently thwart any progress in EU integration.Currently, referring to the advanced stage of preparations for EU accession,Macedonia is demanding that EU member states and institutions put pres-

sure on Greece and withdraw the blockage in launching negotiations. For thisreason declaring an early election and making an appeal to the society wasthe only chance of ending the political crisis.Opinion polls point to victory in the election for the ruling VMRO-DPMNE butthe partys position in the future parliament will be decidedly weaker than now.Despite this the government is most likely to continue its present policy.

Bo n nd h z ov n : not pow t ub tw n t h r p nt t v nd s b n po t c n

On 13 ap t N t on a mb y o r pub k s p k (rs) dopt d o ut on on c y n out ndum on t ty o t wmpo d by t h r p nt t v o B h, p t cu y t u t on

d n t comp t nc o cou t nd t p o cuto o c t tc nt v o t t t . T d c on p t o po cy con t nt ypu u d by rs o qu t on n t po t on o t h r p nt t v

o B h nd t comp t nc o t c nt ut o t nd t n u-nc on t tu t on n rs.

The resolution was adopted at the initiative of the president of RS, MiloradDodik. He claims that the central prosecutors office is involved in many morecases of war crimes against Serbs than Bosnians and Croats, which proves

this institution is biased. The parliaments decision was strongly criticised byrepresentatives of international institutions, including the head of EU diplo-macy, Baroness Catherine Ashton, the High Representative Valentin Inzko

8/6/2019 CEWEEKLY_112

8/8


C E N T R A L

E U R O P E A

N

w E E k L y

A n a

l

t i c a

l N e s

l e

t t e r

f o r

C e n

t r a

l E u r o p e

, G e r m a n

, t h e

B a

l a n s

&

t h e

B a

l t i c

S t a

t e s

O r o

d e

S t u

d i

w s c

h o

d n

i c

h

C e n

t r e

f o r E

a s

t e r n

S t u

d i e s

e v e n t s 8

OSw

T C nt o e t n stud(OSW) was established in Poland

in 1990. OSW is financed from thestate budget. Its task is to monitor andanalyse the political, economic and

social situation in the Central and EasternEuropean countries, in the Balkans,in the Caucasus and in Central Asia.

T m n obj ct v o OsWc :

the internal situations and stability ofthe countries in the area of OSW interests,

foreign policies, issues related to NATO

and EU enlargement, how the states of the region aspireto integrate with Western structures,

energy supply security, existing and potential conflicts, andother issues pertaining to the security.

Pub c t on :

Short analytical papers, presentingopinions of OSW experts

on current and important processes takingplace in OSW area of interest

Large analytical studies on the important

events in the area of OSW interests,published in Polish and in English

approximately 6 times a year

Copyright byOrodek Studiw Wschodnich

T v w xp d by t ut o

o t p p do not n c y ctt op n on o Po ut o t

Editor: Anna abuszewska,Translation: Anna Kuciska

Co-operation: Nicholas Furnival,Tomasz Dborowski

DTP: Wojciech Makowski

O od k stud w W c odn c / C nt o e t n stud

ul. Koszykowa 6A00-564 Warsaw, Poland

phone: +48 /22/ 525 80 00fax: +48 /22/ 525 80 40

osw.waw.pl

wIDZENIAPUNkTP O L I C Y B R I E F S

OSwPRACEO S W S T U D I E S

himself and the European Parliament Reporter on BiH Doris Pack, as a threatto the stability and unity of the country. The resolution is the most likely notto come into force and will be blocked by the National Chamber of RepublikaSrpska (the higher chamber of the parliament of RS).

The actions taken by the authorities of RS are above all aimed at divertingattention from increasing internal problems. Furthermore, they prove the lackof real impact the international community has on the situation in BiH. Giventhe fact that after the election held in October 2010, the attempts to establishthe government of BiH on a central level have not yet been successful, theposition of the government of RS is now clearly more powerful. With regard tothis it can be expected that in the immediate future other similar incidents willoccur. They will be a test to see how far the authorities of RS can go in takingover competences of the central authorities of BiH and not expose themselvesto repercussions from the international community.

g m n p t d v d dov t u o n nc n t eU bud t

On 12 ap t eU Bud t nd f n nc P o mm n Comm on J nu z l w ndow k n t nt v w v to t g m n p u -

t d c n n n nc n t eU bud t. Und p opo teU bud t wou d b n on t d n nc d t ou n w eU t x t twou d p c p t o t cont but on m d om n t on bud t .in g m ny t p opo w n t v y c v d by t u n co t ono CDU-CsU/fDP, w t p ovok d t nt t o t oppo t onp ty t sPD nd t g n p ty.

Janusz Lewandowski proposed a change in the structure of the revenues ofthe EU by securing contributions from the tax on air transport, VAT or the taxon financial transactions. Thanks to this solution contributions from nationalbudgets would be diminished. The spokesman for the German Finance Minis-try expressed his opposition to the proposal as according to the German gov-ernment the present system based on the contribution from national budgetsis simpler. The German federal government is consistent in opting to keep thecurrent level of contributions to the EU budget which amounts to 1% of GNI.Moreover, Germany wants the funds obtained from the tax on financial trans-actions to fuel the German budget for the time being. The coalition partnerthe CSU sees Commissioner Lewandowskis proposal as a threat to stabilityand budgetary discipline in the EU. Also the FDP rejects this solution as theone that will not increase the budgets transparency. Janusz Lewandowskisconcept was well received by the Green party which agrees particularly onthe introduction of the financial transaction tax. The Greens argue that puttingmore of the burden on financial institutions would be more just. Furthermore,according to the Greens, it would eliminate disputes over contributions andpayments into the EU budgets that accompany all negotiations. The SPDalso backed the idea of introducing the financial transaction tax, however,according to the party, the new revenues of the EU have to trigger decreased

contributions from national budgets.The German government fears that this tax in reality will lead to increasedcontributions from Germany. Additionally, in case of underestimating revenuesto the EU budget, there is a risk of the EU having liabilities.

CEWEEKLY_112

Documents

Transcript of CEWEEKLY_112