Europe’s Last Dictator Has Become the Darling of the Bond Market

Alexander Lukashenko, president of Belarus, is showing a softer side that’s helped cut the premium on the country’s debt to the lowest in almost a year compared with other emerging markets. The bonds have climbed at twice the pace of Russia’s since February. And Ashmore Group Plc, which owned Belarus Eurobonds as of the end of September, says the rally has further to go.

Wedged between Russia and the European Union, the former Soviet republic is in the unfamiliar position of receiving largesse from both sides simultaneously. While Moscow provided a $760 million loan to Belarus this summer, the EU eased sanctions on the country on Thursday as a reward for Lukashenko’s decision to release political prisoners and host talks between Russia and Ukraine that led to a peace deal in February.