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  BELARUS

REPUBLICAN REFERENCE

Area (sq.km)
207,595

Population
10,350,194

Principal ethnic groups
Belarusians 77.9%
Russians 13.2%
Poles 4%

Capital
Minsk

Currency
Rubel
(Belarusian Rouble)

President
Alexander Lukashenka

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Background:
After seven decades as a constituent republic of the USSR, Belarus attained its independence in 1991. It has retained closer political and economic ties to Russia than any of the other former Soviet republics. Belarus and Russia signed a treaty on a two-state union on 8 December 1999 envisioning greater political and economic integration but, to date, neither side has actively sought to implement the accord.

Update No: 258 - (27/06/02)

The Belarus Republic is in the doldrums. Apart from benighted Moldova, it has the least successful economy in the FSU. What is especially galling is that its Baltic neighbours, Lithuania and Latvia, are doing much better, despite starting from a lower base at independence.


Frittering away its lead
In 1992 Belarus had the highest living standards in the Soviet Union, providing Russia with 25% of its meat and other foodstuffs. A comparatively successful state farm system accounted for this, founded on cheap fuel from Russia and plenty of farm machinery from the rest of the Union.
One of its farm bosses at the time was Alexander Lukashenka, now president. He voted against independence in 1991, the only MP to do so. He has long been now trying to drum up a nostalgic union with Russia, the Belarus-Russia Union, that already formally exists, but has little to show for itself.
The economy stagnated under Soviet-style economics amid hyper-inflation in the 1990s. Official statistics posted growth even in double figures in some years. But most of the population knew better as shortages multiplied.

Russia to the rescue!
The economy is still being propped up by Russia. Belarus is only just behind Germany in its trade with Russia, its leading trading partner. It still obtains what amounts to subsidised fuel, while selling the Russians consumer goods and machinery to the tune of 11% of their imports, goods most of which no-one else would want to buy. Naturally, the reform-minded technocrats in charge of the Kremlin and Moscow ministries do not fancy having to carry on picking up the bills for Belarus.
It is the veteran Russian communists in the Duma and members of the Russian security forces that have a soft spot for the regime in Belarus and cultivate the fantasy of a Union with it. Little is likely to come it while Belarus continues to languish in its post-Soviet hangover, a neglected little backwater of a country. 

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ENERGY

Belarus unveils plans to sell stakes in petrochemical companies

The Belarusian government has unveiled a new plan of distributing stakes in the country's state-owned petrochemical enterprises marked for ownership reform, Belapan News Agency has reported.
The government intends to retain controlling stakes and offer the remaining 49.9 per cent in lots of 10 per cent each, Andrey Tur, deputy minister of economy, said on state radio. 
According to him, the government would manage to earn more money this way.
Six petrochemical enterprises - the Naftan oil refinery in Navapolatsk [Vitsebsk Region], the Azot chemical plant in Hrodna, the Belshyna tyre factory in Babruysk [Mahilyow Region], and the Khimvalakno chemical fibre enterprises in Hrodna, Svetlahorsk [Homel Region] and Mahilyow - are to be transformed into joint-stock companies by 1st August.
The 10 per cent stakes in them are to be sold before the end of the year.
As a result of the partial privatisation, the government expects to receive more than US$1bn in investment within the following few years, including US$250m this year. 
Meanwhile, potential Russian investors expected to acquire much larger stakes. For instance, Anatoliy Nuryayev, vice president of Surgutneftegaz, said that his company would invest in Naftan only if it could buy control of it. Otherwise, Surgutneftegaz would have to give up its plans regarding Naftan and other Belarusian petrochemical enterprises and consider acquiring similar enterprises in Ukraine, Nuryayev said.
"They (Belarusians) are just impossible to deal with," said the executive of one of the Russian oil companies in an interview with gazeta.ru. According to him, no one would be interested in a 10 per cent stake without being guaranteed an increase.

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FINANCIAL NEWS

Belarus posts 4.3 per cent GDP growth in first five months of 2002 


Belarus's GDP grew 4.3 per cent year-on-year in January-May, said the country's Ministry of Statistics and Analysis, Belapan News Agency has reported. Industrial output rose 4.1 per cent, consumer goods output increased 4.9 per cent, food production was up 1.7 per cent, non-food output up 2.5 per cent and liquor production up 21.1 per cent.
The ministry reports a 3.9 per cent rise in agricultural output. Livestock and poultry sales were up 5 per cent, milk production up 9 per cent, while egg production went down 7 per cent.
Investment in fixed assets rose 6.6 per cent and cargo traffic rose 10.9 per cent. About 850,000 sq.m. of housing was commissioned, down 6.7 per cent from January-May 2001.
Retail turnover rose 15.5 per cent and trade in services increased 8.3 per cent.

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