Protectionism or Cross Border Business: a Belarusian Dilemma

By Vadzim Smok

At the end of the last year the Office of Statistics of Poland published information on the money spent by nationals of neighbouring countries.

According to their report, in the period of July to September 2013 Belarusians spent $250m in Poland. Surprisingly, this figure per capita appeared larger than that of either Ukrainians and Russians.

Because of lower prices and better quality of goods, Belarusians from border regions, and even from remote parts of Belarus, prefer to shop in Poland.

This trend has damaged Belarus' own manufacturers and pumps foreign currency out of the country. This could be the main reason why the Belarusian government delays signing agreements to ease local border traffic control with Poland and Lithuania. Allowing a million and a half Belarusians to enter a 50 km area of the EU without a visa would deal a hard blow to the country.

The government, however, does not turn down EU funding for cross border cooperation programmes implemented by the EU. In recent years these programmes have made considerable progress in breaking the isolation of Belarus' border regions.

Protectionism vs Cross Border Business

The local border traffic regime, which the EU has suggested to Belarus, will give citizens who live in a 50-kilometre radius on both sides of the border the possibility to move in this area without a visa.

Belarus has already implemented such an agreement with Latvia, which has a comparatively small border with Belarus, though still refuses to do so with Poland and Lithuania. Lithuania has already gone through all the necessary procedures for the implementation of easing local border traffic control with Belarus a few years ago, as did Poland.

growth of cross border traffic will increase the inflow of cheaper and higher quality EU goods into Belarus, which will hurt local manufacturers

The authorities do not publicly explain the reasons, but they seem to be mostly tied to economics: growth of cross border traffic will increase the inflow of cheaper and higher quality EU goods into Belarus, which will hurt local manufacturers. It will also lead to even more foreign currency being drained from Belarusian currency reserves, an urgent problem for Belarus that it has been facing in recent years.

While such fears are warranted, Belarus also loses a great deal from its closed borders and inability to use the EU neighbourhood in order to benefit its own development. The tourism industry, the largest beneficiary of a near-border destinations, is very weak and the number of tourists from neighbouring countries remains very low in Belarus.

Belarus-Lithuania-Latvia: Promoting Cross Border Tourism

Despite the obstacles with very tight Belarusian border control, the EU continues to try to establish contact with their neighbouring Belarusian regions to promote their social-economic development and people-to-people contacts.

In 2007-2013, Belarus participated in the Poland-Ukraine-Belarus and Belarus-Lithuania-Latvia border crossing programmes, which embraced the whole western territory and even some parts of eastern Belarus. Around 90 trilateral and bilateral projects were implemented in total, with a budget of more than €220m.

Apart from tourism development, which remains a very popular project theme in the programme, it has implemented projects in other spheres. In 2012-2013, the Hrodna Clinical Hospital had some of its facilities renovated and received new equipment, the Brest region psycho-neurological hospital received funds for creating new departments for the treatment of alcoholism and drug addiction.

Water management and purifying facilities were built in the towns of Kamianiec and Vysokaje in the Brest region. The most costly projects aimed at the reconstruction of border crossing points, such as at Piaščatka in the Kamianiec district.

These programmes clearly benefit the local communities of Belarus, but on a national level some obstacles to cross border cooperation remain in addition to a strict visa regime.

“Belarus looks like a blank spot on the map of cooperation, mainly because of the bureaucratised procedure for the approval of projects by the central government,” says a representative of the Belarusian Sport and Tourism Association Siarhei Kaliada.

Foreign aid represents an issue which is subject to intense focus on the part of the authorities, which have not yet put aside Soviet schemes of working with their western partners.

On the other hand, many people in the government realise that cooperation should continue despite the two side's political differences for the benefit of local communities. As Dzmitry Jermaliuk, Head of Department of the EU at Foreign Ministry of Belarus, said in an interview to Radio Racja, “The cross border cooperation programme is not the site where we discuss the politics of Minsk and Brussels. Here, we cooperate on concrete issues.”

Although it remains unclear when the local border traffic with Lithuania and Poland will start, the EU cross border cooperation projects already benefit Belarusians. Quitely, authorities learn that Europe can be a helpful partner in resolving local problems of Belarus.

Belarus Digest