Economy

European Union Outlines €3 Billion Economic Support Package To Future Democratic Belarus

Feature 31 May 2021
European Union Outlines €3 Billion Economic Support Package To Future Democratic Belarus

The European Commission has presented to the Council its outline for a comprehensive plan of economic support to a future democratic Belarus. The plan, of up to €3 billion, reflects the European Union's commitment to support the Belarusian people's wishes for a peaceful democratic transition in the country following the Presidential elections of August 2020, which were neither free nor fair. Once Belarus embarks on a democratic transition, the EU will activate the support plan.

President von der Leyen said: “Our messages are twofold. To the people of Belarus: we see and hear your desire for change, for democracy, and for a bright future. And to the Belarusian authorities: no amount of repression, brutality or coercion will bring any legitimacy to your authoritarian regime. So far, you have blatantly ignored the democratic choice of the Belarusian people. It is time to change course. When – and we believe it is a case of when, not if – Belarus starts its peaceful democratic transition, the EU will be there to accompany it.”

The support plan highlights several indicative measures to enhance Belarus' resilience: boosting the country's economic recovery; addressing key structural reforms; and investing in sustainable infrastructure and the green and digital transformations.

To deliver tangible results, the EU, including the European Commission in co-operation with International Financing Institutions, will support flagship investments, from supporting economic growth to connectivity, boosting innovation and supporting climate action, and supporting democracy, transparency and accountability. In addition and complementary to the economic plan, the EU will offer to conclude a bilateral framework agreement in order to reinforce the longer-term relations between the EU and a democratic Belarus.

A full press release published by the the European Commission on May 28:

Today, the European Commission is presenting to the Council its outline for a comprehensive plan of economic support to a future democratic Belarus. The plan, of up to €3 billion, reflects the European Union's commitment to support the Belarusian people's wishes for a peaceful democratic transition in the country following the Presidential elections of August 2020, which were neither free nor fair.

Once Belarus embarks on a democratic transition, the EU will activate the €3 billion package, a mix of grants and loans leveraging public and private investments, to help Belarus to stabilise its economy, reform its institutions to make them more democratic and help increase the economy's resilience, growth potential and job creation.

The newly presented outline highlights several indicative measures to enhance Belarus' resilience:

  • First, through direct financial support we will boost the country's economic recovery. This will help restore macro-economic stability in Belarus and strengthen its precarious fiscal situation. In addition, the EU will organise an EU-Belarus High Level Investment Forum to expand investment and trade opportunities and an EU High Level Donor Meeting to raise additional EU grant resources required to finance and mobilise EU expertise and investments to support the economic transition. With these initiatives, the EU expects to mobilise up to €1.5 billion* in EU loans as well as public and private investments.
  • Second, we will mobilise a Transition Package of up to €400 million in grant assistance under the Neighbourhood, Development and International Cooperation (NCIDI)-Global Europe to support the democratic transition and address key structural reforms. This will include enhancing the quality of justice, improving business environment and supporting SME's development. EU funding will also aim to contribute to the education and health care systems reform and provide assistance to strengthening social safety nets and protecting the most vulnerable households. Support to civil society, including enhancing their role in decision-making at all levels of government and work as watchdog and support for a free and independent media, will remain at the core of the EU's actions.
  • Third, we will invest in sustainable infrastructures and the green and digital transformation. In partnership with International Financial Institutions, the EU expects to mobilise up to €100 million in grant funding to leverage up to €1 billion of key public and private investments supporting the country's green and digital transformation, connectivity and access to finance for Belarusian SMEs.

To deliver swiftly tangible results to a democratic Belarus and ensure sustainable impact, the EU, including the European Commission will mobilise all tools and instruments available in cooperation with International Financing Institutions to prioritise support to five key flagship investments:

Flagship 1: Supporting an innovative & competitive economy including through direct support to 20,000 SMEs

Flagship 2: Improving transport connectivity & facilitating trade at EU-Belarus borders

Flagship 3: Boosting innovation & digital transformation, including through an Eastern Partnership IT school in Minsk

Flagship 4: Supporting a green Belarus, including through support to energy efficiency, waste management and infrastructure

Flagship 5: Investing in a democratic, transparent & accountable Belarus

In addition and complementary to the economic plan, we will offer to conclude a bilateral framework agreement in order to reinforce the longer-term relations between the EU and a democratic Belarus.

Members of the College said:

European Commission President Ursula von der Leyen said: “Our messages are twofold. To the people of Belarus: we see and hear your desire for change, for democracy, and for a bright future. And to the Belarusian authorities: no amount of repression, brutality or coercion will bring any legitimacy to your authoritarian regime. So far, you have blatantly ignored the democratic choice of the Belarusian people. It is time to change course. When – and we believe it is a case of when, not if – Belarus starts its peaceful democratic transition, the EU will be there to accompany it.

High Representative of the European Union/ European Commission Vice-President, Josep Borrell, added: “The European Union is supporting the democratic choice of the Belarusian people with all its means. The massive financial assistance package that we can provide Belarus in the case of its democratic transition should be a genuine incentive for the current authorities to change their course. Combined with our extensive sanctions on the regime, which will be increased further in the coming weeks, as well as recalibrations of our existing financial assistance away from the State and directly to the people, we are showing that the EU remains truly committed to a democratic Belarus.”

European Commissioner for Neighbourhood and Enlargement, Oliver Várhelyi, emphasised: “Our message is loud and clear: we stand by the people of Belarus in their quest for democracy, which shall prevail. The announced support package is yet further proof of our determination to actively support the people of Belarus, and will help Belarus in its reform process to develop a more resilient society and economy.”

Background

Since the 9 August 2020 presidential elections and the brutal response by the authorities, which continues to date, the European Union has been carefully following the situation in Belarus. The EU is impressed by the courage of the Belarusian people who continue to strive for democracy and for their fundamental rights, despite the brutal repression of the authorities.

The European Council conclusions on Belarus of 12 October 2020 encouraged the European Commission to prepare a comprehensive plan of economic support for democratic Belarus. In line with these conclusions, the EU has also reviewed its relations with Belarus, scaled-down bilateral cooperation with the Belarusian authorities at the central level and increased support for the Belarusian people and civil society.

The plan is an exceptional instrument to support a peaceful democratic transition in the country. It will need to be fine-tuned to consider the preferences and policy priorities of the legitimate authorities of democratic Belarus. The EU stands ready to activate the plan as swiftly as possible once a democratic transition takes place."

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