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BELARUS


  

 

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Key Economic Data 
 
  2003 2002 2001 Ranking(2003)
GDP
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

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


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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