Russian pressure and recession liberalize Belarus

LIKE OTHER STATE officials in Belarus, Vasily Matyushevsky, deputy chairman of the national bank, is breaking free from his country’s reputation for Stalinist isolationism.

"Unlike other countries of the world we are privatizing banks, not nationalizing them," he says. The global crisis could hardly have extended state intervention in Minsk. The public sector already accounts for more than two-thirds of the Belarusian economy and the banking system is little more than a policy instrument.

Alexander Lukashenko, Belarus’ all-powerful president for the past 15 years, seems to be trying to shore up his influence by playing Russia off against the west, while simultaneously cultivating friendships with such countries as Iran, Venezuela, China and India.

"Belarus has a multi-vectoral foreign policy," is how foreign minister Sergei Martynov explains the approach to Euromoney.

Despite a rapprochement with the EU and Russia’s financial and economic problems, the balance is tipping in...