Kazakevich: “We Are Talking About Millions”

Political scientist Andrei Kazakevich on the possible consequences of the démarche by Pirelli Group and Sandoz.

After an investigation into the situation with workers’ rights at BMZ, the leading global tire manufacturer Pirelli Group decided to terminate (https://gazetaby.media/post/italyanskaya-pirelli-group-prekrashhaet-otnosheniy/182131/) its commercial relations with the Belarusian enterprise, according to the Professional Union of Belarusians in Britain.

On the same day, it became known that the international pharmaceutical company Sandoz would completely stop purchasing advertising on state television from 2022.

Andrei Kazakevich, director of the Political Sphere Institute and doctor of political sciences, told Filin (https://gazetaby.media/category/filin/) what possible retaliatory steps the Belarusian authorities might take.

The expert suggests that the decisions of the above-mentioned companies may have been caused by a number of reasons: both fear of sanctions and an attempt to avoid reputational costs from cooperation with Belarusian enterprises.
— Cooperation with large enterprises, even if they are not currently under sanctions, is a risk.

After all, new restrictions, secondary sanctions, and so on may be introduced.

The behavior of Western companies is also influenced by image concerns.

For them, cooperation with the Belarusian state now means not only financial losses resulting from sanctions, but also the fear of reputational damage, the political scientist explained.

According to him, for many companies the image of a socially responsible business is important, including in the field of human rights, the interlocutor emphasizes.

And such companies will avoid cooperation with countries where human rights are violated on a mass scale.
— It is obvious that this issue is beginning to play a role with regard to Belarus.

The starting point came soon after the beginning of the political crisis in our country.

Then came the beginning of this year, when we remember the story (https://gazetaby.media/post/vlasti-prodlili-zapret-na-vvoz-i-realizaciyu-tovar/180847/) of Nivea and Škoda.

And as a result of the Ryanair plane landing, the migration crisis on the EU border, and new repressions against civil society and the media, we are seeing a new wave of negative attention toward Belarus.

Especially from large companies for which the Belarusian market is not essential.

They are forced to react in order not to have problems in their main markets and with key partners, the Filin interlocutor says.

What will the reaction of the Belarusian authorities be?

Should we expect counter-sanctions, as happened in the case of the general sponsors of the Ice Hockey World Championship?

Andrei Kazakevich does not rule out such a development.

He suggests recalling what the authorities faced when they introduced counter-sanctions against Škoda:
— Those actions led to rather contradictory results.

It turned out that their cars are assembled mainly in Russia.

And not only assembled, but some components are also produced there.

And not only in Russia, but also in other countries of the world.

And here it already becomes unclear against whom those countermeasures were ultimately introduced.

Against the Russian subsidiary or against the concern itself?

It is clear that its share in our market is practically insignificant.

But for the Russian manufacturer this was important.

In addition, the expert noted, the counter-sanctions hit Belarus’s own citizens, the employees of Belarusian Škoda service centers.

A similar situation may arise in other such cases:
— Of course, it is necessary to take into account what supply chains these companies have built here.

But it may well happen that retaliatory sanctions will strike not Western countries, but their own partners.

Here, however, each individual case needs to be examined separately.

Speaking about the possible response of the authorities to the pharmaceutical company Sandoz, the political scientist noted that a ban on the sale of medicines is a rather sensitive matter in terms of social reaction.

And it certainly will not improve the image of the authorities.
— Therefore, common sense may prevail here.

And such countermeasures will not be introduced.

Although this scenario is probably less likely.

The refusal of Western companies to place advertising on state television will be a tangible blow to their budget, Kazakevich believes: “We are talking about millions.”

In his view, in the conditions of an information war the authorities are most likely not going to reduce the amount of propaganda television content.

And here they have several options for getting out of the situation.

Either to save on something else, cutting the budget for entertainment programs, reducing purchases of Russian TV series, for example.

Or to reach into the pockets of public-sector employees by cutting some social payments.
— But in any case, political responsibility for this will fall not on Western companies, but on those who decide to compensate for the losses at the expense of the budget.