Minsk's Deepening Relations with China

C O N F I D E N T I A L MINSK 000956

SIPDIS

SIPDIS

E.O. 12958: DECL: 08/09/15
TAGS: PREL PINR BO CH
SUBJECT: Minsk's Deepening Relations with China


Classified by Ambassador George Krol for Reasons 1.4 (B,D)


1. (U) Summary: Belarus' relationship with China continues
to strengthen. China has invested and plans to invest
millions of dollars in Belarusian companies while Belarus
is contemplating opening a bank in China. Both countries
have exchanged military delegations and have signed
military accords. It is clear that Belarus sees China as a
cash cow with enough international power to counter the
world's negative opinion of Belarus. It is not clear what
China wants, although it does not hurt to have a "loyal"
friend in Europe. As Belarusian officials continue to meet
their Chinese counterparts, including Lukashenko's planned
visit in September, post expects the Belarusian-Chinese
relationship to continue to grow. End Summary.


2. (U) Leaders of Belarus and China have been publicly
flirting with each other for the last several months.
Lukashenko often states how much Belarus values its
friendship with the "powerful" and "prosperous" China and
how he agrees with China's policies in the international
arena. China's Vice President Zeng Qinghong likewise has
stated that the Chinese government values its cooperation
with Belarus and would like to bring bilateral relations to
a new height. On July 27, Chinese Ambassador to Belarus Yu
Zhenqi expressed China's respect for Belarus' independent
way of development and guaranteed China's support to the
GOB for strengthening Belarus' independence and
sovereignty. He stated that though geographically remote,
China and Belarus are "spiritually close".

Military Mutual Aid
--------------


3. (U) In the past two years, Belarus has sent and received
several military delegations to and from China. During a
recent trip to China on June 3, Defense Minister Colonel-
General Leonid Maltsev met with his Chinese counterpart,
Colonel-General Cao Gangchuan, to agree on "friendly",
"cooperative", and "multi-level" military ties. Not long
after their meeting, China announced that it would provide
USD 600,000 worth of medical equipment to the Belarusian
Defense Ministry and would send military personnel to the
Belarusian Military Academy for training. [Note: Students
from North Korea and Vietnam also study at this academy.]
Likewise, during a visit to Beijing on July 22, Chief of
Communications Major-General Alexander Sokolov announced
that the Belarusian military is studying the structure and
organization of China's military communication system.

Political Partnership
--------------


4. (U) Foreign Minister Sergei Martynov announced on March
3 that China is Belarus' most important political partner
in Asia. Ties are based on political trust and a "wide-
ranging consensus on major international issues". In May
2004, both countries reduced consular fees by half to
promote tourism and business travel. In October 2004,
Belarus' upper chamber of parliament renewed an agreement
with China exempting each country from paying rent for
premises provided for embassies and embassy staff. In June
2005, representatives from the pro-Lukashenko Communist
Party of Belarus (CPB) met with the visiting Communist
Party of China members, who expressed their respect for the
CPB for "preserving the party" following the collapse of
the Soviet Union. On July 27, Chinese Ambassador to
Belarus Yu Zhenqi emphasized the Chinese parliament's
eagerness to develop contacts with their Belarusian
counterpart.


5. (U) Belarus frequently asserts its support for the One-
China Policy and views China's anti-secession laws as
"conducive to regional and world peace and stability".
[Note: Belarus is not against playing both sides; there is
a small Taiwanese trade mission in Minsk, but Beijing
definitely gets preference.] China has noted Belarus'
support and would likewise assist Belarus in the
international arena. On July 25, head of the Upper Chamber
of the National Assembly Gennadi Novitski thanked China for
its support by counteracting the adoption of resolutions
"biased" against Belarus.

Academic Affiliation
--------------


6. (U) According to the first deputy rector of Belarusian
State University, cooperation with China in economics,
science, technology, and other education has strengthened.
Approximately 1,000 Chinese citizens currently study at
Belarusian educational institutes. In 2004, the Belarusian
National Academy of Sciences signed cooperation accords
with Chinese research and development laboratories and
industrial enterprises while representatives of Belarus'
National Technology Transfer Center attended an
international fair and conference in Ningbo to study modern
Chinese technology and investment. On June 26, China
announced plans to donate USD 1.2 million worth of
equipment, including computers, monitors, televisions and a
desktop publishing system to Belarus' National Library. On
July 11, the Belarusian State University signed a
memorandum of understanding with the Harbin Science and
Technology Office to create a scientific-technical
cooperation center and a joint laboratory with branches in
Minsk and Harbin, China.

Economic Association
--------------


7. (U) In 2004, trade with China reached record levels. In
January, the Belarusian Chamber of Trade and Commerce
(BCCI) met with Zhenqi to discuss a consolidated action
plan to increase cooperation between the BCCI and
subcommittees of China's Committee for Assistance to
International Trade. On May 17, Lukashenko stressed that
the USD 460 million in bilateral trade with China in 2004
was "only the beginning" and predicted trade would greatly
increase. On June 3, the Belarusian Embassy in Beijing
asked the National Bank of Belarus (NBB) to "request" a
Belarusian bank open a branch in China to represent the
Belarusian banking system in Chinese financial markets,
increase bilateral trade, monitor the markets, and advise
other Belarusian banks and companies. The NBB publicly
stated this was a great idea, and that a "volunteer" bank
would soon be found.


9. (U) Belarusian companies are searching for investment
opportunities in the technological development of western
and northeastern China while Chinese companies have hired
Belarusian chemists, engineers and other experts from the
National Technology Transfer Center. In 2004, Belarusian
Steel Works (BMZ) and China signed an agreement to
establish a factory in Shanghai.

Loans and Aid
--------------


10. (U) Since 2003, China has given Belarus millions of
dollars in aid to the National Library project and the
Defense Ministry, such as USD 1.2 million in humanitarian
aid for Belarus to participate in joint projects with China
and USD 1.2 million to purchase equipment for the Ministry
of Emergency Situations. In September 2004, China gave
Belarus USD 600,000 to send experts to China for training
in the areas of trade, economy, finance, banking, taxation
and customs. In December 2004, the Belarusian-Chinese
Commission on Trade and Economic Cooperation signed an
agreement on China's gratuitous aid to Belarus. Other
Chinese help includes a USD 150 million loan to Belarusian
Telecommunication Network to buy equipment, a USD 40
million loan to reconstruct Minsk heat power plant No. 2,
and a USD 20 million loan to launch medical-pill production
facilities at a Belarusian pharmaceutical plant.

Culture, Tourism and Sport
--------------


12. (U) In November 2003, Beijing hosted the Days of
Belarusian Culture. The Culture Ministries of China and
Belarus afterwards signed a 2004-2006 cooperation protocol
to hold Days of Chinese Culture in Belarus in 2004 and 2006
and Days of Belarusian Culture in China in 2005. In March
2005, a book called 'The Republic of Belarus', edited by
the Institute of Russia, East Europe and Central Asia
Studies of the Chinese Academy of Social Sciences, was
published to inform the Chinese population of the history,
politics, economy and culture of Belarus. During the 2003
Days of Belarusian Culture, the Belarusian embassy in China
published a Chinese-language tourist magazine to promote
Belarus as a holiday destination. The two governments plan
to sign an agreement on tourism when Lukashenko visits
China in December. Belarusian national airline Belavia
plans to initiate regular passenger service from Minsk to
Beijing soon, and in September the GOB hopes to organize a
tour of Belarus for Chinese travel agencies, aimed at
adding Belarus to Chinese citizens' list of places to
visit. Moreover, in August the Belarusian Ministry of
Sport and Tourism signed a deal with its Chinese
counterpart to send Belarusian Olympic athletes to China to
train.

Taiwanese Perspective
--------------


14. (C) On July 26, poloffs met with the first secretary of
the Taipei Economic and Trade Mission in Minsk, Chin Feng,
who noted the increasing relationship between Belarus and
China. Feng stressed China's interest in Belarusian fiber
optics technology for use in China's rapidly growing
military. According to Feng, Belarus sees China as an
economically and politically powerful friend who could
throw strong support behind Belarus at international
organizations, particularly the UN Security Council.
China, according to Feng, sees a friendship with Belarus as
a way to have some fingers in Europe. Belarus' growing
interest in China has caused Feng's organization's
relationship with the government to cool. GOB officials
now hesitate to meet with Feng and will no longer accept
gifts from the Taiwanese Mission.


15. (C) The Chinese ambassador, Yu Zhenqi (a colleague of
the ambassador in Moscow) informed ambassador at a private
dinner that he is leaving Belarus shortly and will become
the Chinese ambassador to Bulgaria. Yu has been a good
contact. He admits that China values Belarus largely as a
political foothold in the region, but doesn't expect much
in the way of trade profits emerging from the relationship.
He noted that the presence of the Taiwanese trade office in
Minsk is a big irritant, but it seems Minsk has reduced its
interaction with that office. Yu indicated he did not
think Lukashenko would fall from power soon. China takes a
long-term perspective in building its ties with Belarus as
part of its general policy of expanding its fiscal
influence where it is welcome. While Yu did not say so, it
seems China is using Belarus' hostility to the West and
coolness to Russia to build up a relationship that might be
beneficial to Chinese interests.

Comment
--------------


16. (C) Belarus has seen large economic benefits in having
a close relationship with China. As from its relationships
with Iran, Syria, and Sudan, Belarus is receiving millions
of dollars of investment, aid, and sales from China while
not having to spend much of its own money in return.
Unlike Belarus' Middle Eastern partners, China is an
economically and politically powerful giant with much
influence in the international arena. Lukashenko has
little to lose and much to gain from continued cooperation
with China, and he is not asked to give much in return. We
expect this friendship to continue.

KROL