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Key Economic Data 
  2003 2002 2001 Ranking(2003)
Millions of US $ 17,493 14,304 12,200 76
GNI per capita
 US $ 1,590 1,360 1,290 122
Ranking is given out of 208 nations - (data from the World Bank)

Books on Belarus

Update No: 313 - (25/01/07)

Russia turns sour
Belarus, under the authoritarian President Alexander Lukashenka, has been one of Russia's closest allies in the region. The countries signed a loose union treaty in the mid-1990s and no visas are needed for land travel between them. 
While Russia has supported the dictatorial Lukashenka in the face of severe Western criticism, it has appeared uneasy over his heavy-handed suppression of opposition and irritated at his insistence that small and poor Belarus can only be unified with Russia on an equal basis. 
Yeltsin played him along. But relations have been tense under Russian President Vladimir Putin, who angered Lukashenka by floating an integration plan under which Belarus would essentially become a province of Russia.

The polar bear-hug
If Belarus is not a Russian province, then it is a foreign country like any other and should be treated as such. That is the Kremlin's new line.
Residents of Belarus' capital have stocked up on warm clothes and electric heaters as fears rose that Russia was about to cut off the natural gas on which the country depends. Russia says Belarus must pay more than twice as much for gas this year - and even more later - and turn over a half-share in its pipeline system, a major transit route to Europe, if it wants to avoid a gas shut-off. 
The dispute bears strong echoes of last year's crisis between Russia and Ukraine, which caused ripples of concern in Western Europe, whose supplies of Russian gas were briefly disrupted. The price dispute with Ukraine in early 2006 resulted in temporary supply reductions to European customers, raising concerns about Russia's reliability. 
But in that case, Russia's price demand was seen as political pressure against a Western-leaning government; this time it is against a country whose longtime leader has close ties with Moscow. 
Belarusian opposition leader Alexander Milinkevich suggested Gazprom's demands are aimed at forcing President Alexander Lukashenka to cede control over the pipeline network and other attributes of sovereignty in exchange for continued Russian support for his authoritarian regime. "Through energy pressure, the Kremlin is trying to force Lukashenka to integrate according to the Russian scenario, which is extremely dangerous for Belarus," Milinkevich told The Associated Press. 
"In the absence of a contract, there is not and cannot be a basis for the delivery of gas to any country or any consumer in the world," Gazprom's export division chief Alexander Medvedev said. 
Lukashenka said the talks on Russian supplies were "very difficult" and urged energy saving. "In the conditions of pressure on Belarus one must know how to live within one's means and economize, especially on energy," he said. 
Medvedev said a shut-off would not affect the 30 percent of Russian gas deliveries to Europe that transit Belarus. Much of the Russian gas destined for Poland and Germany, among other countries, goes through a pipeline that is already owned by Gazprom but is under the day-to-day control of the Belarusian pipeline network, Beltransgaz. "The issues of transit and supplies are not linked and will not be linked," Medvedev said. But he also
raised the possibility that Belarus would seek to siphon gas meant for European customers, saying that gas "will be delivered to the Russia-Belarus border. How the Belarusians will conduct themselves I don't want to guess, but I hope it won't come to that." 
Medvedev said Gazprom had scrapped its initial demand that Belarus begin paying US$200 per 1,000 cubic meters of gas in 2007. Under what he called a final offer, Belarus would pay US$105 this year - well below world market prices, but more than twice the US$47 it now pays. 
The price would consist of US$75 in cash and US$30 in shares of Beltransgaz, he said. It would increase annually at the same rate as prices for Russian industrial consumers, reaching a market-style European price - minus the transit cost and export duties, which will be exempted - in 2010. Gazprom would pay for a half-share in Beltransgaz by allowing Belarus to pay US$30 per 1,000 cubic meters in shares over the next four years. 
The increasing price would be a severe blow to Belarus' Soviet-style state-run industries, whose financial health - and, in turn, a portion of Lukashenka's popularity - depends on cheap gas.

Deal is struck
The Minsk government had little choice but to comply with Moscow's demands. On the New Year it did exactly that.
Lukashenka must be seething. He must realize that in the Yeltsin era he had far more leverage with a weak and slighted Russia. Putin's Russia is a far more formidable affair and does not take kindly to him. The sophisticated Putin regards him as a clown, whereas Yeltsin saw him as a soul mate. They bonded over many a tipple and manly session, while with Putin it is going to be a strictly business relationship.

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BBH acquires 30% of brewery for US$13.6m 

Baltic Beverages Holding AB (BBH) has acquired 30 per cent of the Belarus brewery Olivaria, Nikolai Dudko, the brewery's director, said, Interfax News Agency reported. 
The deal was sealed in Minsk on December 20th. The brewery issued an additional 36,711 common shares with par value of 376,590 Belarusian roubles, which were all purchased by BBH for US$13.6 million. BBH has also allocated a loan of US$4.9 million to the brewery, Dudko said. The money will be invested in development and be used to repay debts on earlier loans raised from Belarusian banks, he said. Increasing the Olivaria charter capital and selling the additional shares to BBH has reduced the EBRD stake in the brewery to 21 per cent from 30 per cent. Private shareholders own about 49 per cent. The EBRD acquired 30 per cent of additional Olivaria shares in the fall of 2005 for 8.97 billion Belarussian roubles (US$4.1 million). Olivaria holds about 10 per cent of the Belarus beer market, Dudko said. The brewery was established in 1994 on the basis of the Belarus brewery. The company plans to produce 36 million litres of beer in 2006, up 37 per cent. Production is set to grow to 45 million litres in 2007.

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Steel mill to invest US$200m in 2007

Byelorussian Steel Works (BMZ) plans to invest US$200 million in development in 2007, Interfax News Agency reported on January 10th, citing Viktor Matochkin, the deputy director general of Belarus' biggest steel mill. 
Matochkin said the plant, from the Gomel region, would not have to curtail its investments due to higher energy costs. "The project to build a pipe rolling division is being carried out and construction has not stopped for a single day so far this year due to the increase in energy costs. The same can be said about other aspects of the investment program," Matochkin said. Matochkin said BMZ would be paying 30 per cent more for gas this year, and that electricity would also go up. "We are analysing economic and technical ways to minimise losses from the rise in energy costs," he said. Electricity charges from BMZ went up 29 per cent in 2006. They had previously risen 14 per cent on average.

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