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Books on Belarus
REPUBLICAN REFERENCE
Area (sq.km)
207,595
Population
10,310,520
Principal ethnic groups
Belarusians 77.9%
Russians 13.2%
Poles 4%
Capital
Minsk
Currency
Rubel
(Belarusian Rouble)
President
Alexander Lukashenka
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Update No: 304 - (28/04/06)
The odd man out
A strange paradox is that while Belarus is being ostracized by Western
governments, with President Alexander Lukashenka and over thirty senior
officials being banned from the EU and the US in the wake of his dubious
electoral victory in March (82% for him), it is being courted by international
financial institutions.
One reason is that - so far - its economy has been performing rather well, at
least on official statistics. There is reason to suppose, however, that the good
times could soon be over, and official statistics in such a regime are hardly
trustworthy.
Economic recovery
Like other former Soviet republics, Belarus suffered a massive collapse after
1991, with output dropping by more than half thanks to "shock therapy"
reforms. But in 12 years of power Lukashenka has righted that, as the following
statistics show (all taken from the IMF's country report on Belarus in June
2005).
He has presided over a continual increase in real wages for several years,
culminating in a 24% rise over the past 12 months. He has also cut VAT, brought
down inflation, halved the number of people in poverty in the past seven years,
and avoided social tensions by maintaining the fairest distribution of incomes
of any country in the region.
Residents, as well as Western visitors, report that many people are satisfied
with their living standards. Many have family or other ties to Russia, their
giant neighbour, and feel grateful for the stability, moderation and absence of
an oligarch-dominated economy that Belarus enjoys. Of course politically it is a
different story - one of intimidation, and abuse of civil and human rights.
Denim Revolution?
In the circumstance what chance is there of a 'Denim Revolution' in Belarus ever
happening, the name being suggested for an equivalent to the 'Orange Revolution'
in Ukraine, the 'Rose Revolution' in Georgia or the 'Tulip Revolution' in
Kyrgyzstan?
It is highly suggestive that the latter three were named after natural
phenomena, while the former is after all a human product, denim, that happens to
be a staple product of the Belarussian economy.
There's the rub. Nobody is prepared to take Belarussian denim in bulk except the
Russians, as is true of virtually all that they sell them. It has always been
that way because of the soviet-style lack of quality in manufactured products.
This has contributed to Belarussian exports being virtually unsaleable in free
world markets.
The Belarussian economy is totally dependent on Moscow remaining benign in its
policy towards its former subjects, as it sees them. Russia sells Belarus oil
and gas at one fifth, or less, of world prices, much of which, after it has
satisfied its domestic needs, it then refines or whatever into another form and
sells on to world markets.
Moscow to pull the rug?
There is one severe problem for Lukashenka that is emerging in full clarity
after his election victory. The Kremlin was prepared to see him win, indeed
helped him by leaving Belarus out of the reckoning that other former satellite
states faced in energy prices. While gas to Ukraine and Georgia is only going to
be sold at near world market prices soon, it appeared that an exception was to
be made for Belarus, for a while longer at any rate.
Not so. Gazprom is demanding world price levels from Belarus too, unless it
hands over ownership of its transit firm for gas exports to Europe, Transneftgas,
to the Russian giant lock stock and barrel. If Minsk surrenders it meekly to
Moscow, it would lose its last leverage over its energy policy. It would forego
any chance of doing what the Ukrainians did in January when Gazprom shut off
supplies, namely to take over supplies meant for Western Europe.
Lukashenka was always at risk of Moscow turning against him. That is what seems
to have happened. Time will soon tell.
Belarus threatens Europe and USA with "adequate measures in return"
The Belarussian Foreign Ministry has stated that official Minsk may reply
with adequate measures to the EU, which banned entry into its territory for
three dozens of Belarussian officials, including the country's President
Alexander Lukashenka.
"The Foreign Ministry states once again: to reply to people's choice with
bans means to reject the right of Belarussian citizens to live in their own
country in their own way, and not in a foreign one. Republic Belarus is
compelled to take adequate measures against the EU and the USA. In accordance
with international practice, they will concern analogous categories of
persons," official Minsk is quoted by Lenta.ru as stating.
The following have been put onto the black-list of the European Parliament:
Belarussian President Alexander Lukashenka, leadership of presidential
administration - Gennady Nevyglas, Anatoly Rubinov, Natalya Petkevich, Oleg
Proleskovsky, Educational Minister Alexander Radkov, Information Minister
Vladimir Rusakevich, Justice Minister Viktor Golovanov, Belarussian MPs Vladimir
Konoplyov, Nikolai Cherginets, Sergey Kostyan, BRSM Secretary Mikhail Orda,
Belarussian CEC Secretary Nikolai Lozovik, General Prosecutor Pyotr Miklashevich,
KGB Chief Stepan Sukhorenko, court representatives, etc.
It is notable who no less is not on the list - the premier, vice-premiers and
his chief economic ministers. That is why the following visit could take place.
Belarus and EBRD discuss new country's strategy for 2006-2008
A Belarussian delegation headed by acting First Vice-Premier Vladimir
Semashko visited London in April to take part in a joint consultation session of
the European Bank for Reconstruction and Development (EBRD). Business as usual.
As a correspondent was informed at the Belarussian Foreign Ministry, the rising
effectiveness of International Development Banks in countries with middle level
of incomes was planned to be discussed. "The Belarussian delegation will
conduct talks with the leadership of the EBRD and World Bank, discuss the
development of the project of new country's strategy of the EBRD for Belarus in
2006-2008," the Foreign Ministry stressed.
Also, the Belarussian delegation were to inform representatives of international
financial structures about plans and perspectives of social economic development
of Belarus in 2006-2008. Open views exchange concerning Belarussian assessment
of state and perspectives of cooperation with Western stockholders of the EBRD
and the World Bank will take place.
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BANKING
Vneshtorgbank considering purchasing Belarussian bank
Vneshtorgbank is planning to purchase a bank in Belarus, Vneshtorgbank President
and CEO, Andrei Kostin, said, New Europe reported.
"We are looking at a bank in Belarus. We initially planned to purchase a
different bank and conducted due diligence. However, doubts [over that
acquisition] emerged," he said. Talks are also in progress concerning the
purchase of a bank in Azerbaijan, Kostin said. "The Azerbaijan deal has its
own problems," he added. In 2006, Vneshtorgbank will focus on plans to
purchase banks and open subsidiaries on untapped CIS markets, Kostin said
earlier.
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ENERGY
Belarus should pay European prices for gas
Russian natural gas deliveries to Belarus in 2007 should be made at European
price levels, Gazprom CEO, Alexei Miller, said at talks with a Belarussian
delegation. Belarus is expected to submit its proposals on the terms of
cooperation next year by April 30th, a Gazprom press release said, cited by
Interfax News Agency.
Miller made this announcement in Moscow at a working meeting with Belarussian
Energy Minister, Alexander Ageyev, and Beltransgaz General Director, Dmitry
Kazakov, at which issues of mutual cooperation between Gazprom and Beltransgaz
were discussed, the release read. "Particular attention at the meeting was
given to the conditions of cooperation next year. To reach an agreement on gas
prices for Belarus in 2007, talks were started on this issue at Gazprom's
initiative," the Gazprom press service said. Gazprom and Beltransgaz signed
a contract on supplies and transit of gas in 2006 on December 27th 2005. In
accordance with the contract, Gazprom will deliver 21 billion cubic metres of
gas to Belarus in 2006. The cost of gas and tariffs for its transportation
correspond to the conditions of 2005 (US$46.68 per 1,000 cubic metres and
US$0.75 per 1,000 cubic metres/100 kilometres when transporting gas through the
Beltransgaz network and US$0.46 per 1,000 cubic metres/100 kilometres along the
Yamal-Europe gas pipeline).
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COMMON ECONOMIC SPACE
Russia, Kazakhstan, Belarus to sign first CES documents
Russian President, Vladimir Putin, has announced that Russia, Kazakstan and
Belarus would soon sign the first package of 38 documents meant to establish the
Common Economic Space (CES), Interfax News Agency reported.
"As for our Ukrainian partners, we will be glad if they are ready to sign.
But as far as we know from experts our Ukrainian friends will attend the signing
and are ready to sign several documents from the package, but not the entire
package," he said at a news conference in Moscow.
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