EMBASSY MINSK WEEKLY POL/ECON REPORT - SEPTEMBER 18,

UNCLAS SECTION 01 OF 03 MINSK 001013 SIPDIS SIPDIS E.O. 12958: N/A TAGS: PGOV PREL PHUM ECON EPET ENRG KTDB BO SUBJECT: EMBASSY MINSK WEEKLY POL/ECON REPORT - SEPTEMBER 18, 2006 MINSK 00001013 001.4 OF 003 ¶1. The following are brief items of interest compiled by Embassy Minsk. TABLE OF CONTENTS INTERNATIONAL RELATIONS -------------- - Chinese Defense Minister Meets with Lukashenko in Minsk (para. 2) - Lukashenko Arrives in Havana for NAM Summit (para. 3) CIVIL SOCIETY -------------- - Ex-Parliament Chair Says Lukashenko Should Resign (para. 4) - Judge Defers Case against Opposition City Councilmen (para. 5) - Opposition Politician Sivchik Arrested in Minsk (para. 6) TRADE AND INVESTMENT -------------- - Belarusian Glass Factory, IKEA Negotiate Joint Venture (para. 7) DOMESTIC ECONOMICS -------------- - Oil Refining Industry Top Paying Employer in Belarus (para. 8) - Belarus' VISA Bankcards Turnover Up 110 Percent (para. 9) - QUOTE OF THE WEEK (para. 10) -------------- International Relations -------------- ¶2. Chinese Defense Minister Meets with Lukashenko in Minsk On September 13, while receiving China's Minister of National Defense and Vice Chairman of the Military Commission of the Communist Party of China Cao Gangchuan, President Lukashenko expressed satisfaction with military cooperation with China. Lukashenko noted that the two countries had signed more than 220 military agreements and contracts and described China as a great friend of Belarus. Cao replied that Lukashenko enjoys strong support among the Chinese people, including military servicemen. Cao arrived in Belarus for discussions on Sino-Belarusian military cooperation with Belarusian Defense Minister Leonid Maltsev. Following the meeting, Lukashenko presented Cao with Belarus' Order of Friendship between Peoples. ¶3. Lukashenko Arrives in Havana for NAM Summit Evidently without flying over U.S. territory, Lukashenko landed in Havana late on September 14 and attended the Non-Aligned Movement (NAM) Conference of Heads of State and Government on September 15 and 16. His speech focused on increasing NAM's effectiveness in counteracting the West. Lukashenko also met separately with Presidents Hugo Chavez of Venezuela, Mahmoud Ahmadinejad of Iran, and Juan Evo Morales of Bolivia. On September 14, Belarusian Foreign Minister Martynov held meetings with the foreign ministers of Bolivia, Suriname, and Swaziland and with Cuban Minister of Foreign Investment and Economic Cooperation Marta Lomas Morales. Martynov and Morales discussed preparations for a meeting of the Belarusian-Cuban commission on trade and economic cooperation scheduled for late 2006. -------------- Civil Society -------------- ¶4. Ex-Parliament Chair Says Lukashenko Should Resign On September 13, former Council of the Republic Chairman Aleksandr Voitovich published an internet letter in which he called for President Lukashenko to cede power to Prime Minister Sergey Sidorsky on September 21 and promised to support Sidorsky as "Belarus' legitimate acting president." Voitovich noted that, while the Belarusian constitution as amended by a 2004 referendum does not limit the number of presidential terms, the Presidency Law sets a two-term limit. His second term was to expire on September 20, 2006. Earlier this month, former opposition presidential candidate Aleksandr Kozulin, who is serving a 5 1/2-year prison sentence on politically motivated charges, also called upon Lukashenko to cede power to Sidorsky on September 21. ¶5. Judge Defers Case against Opposition City Councilman On September 13, a judge of the Bobruisk City and District Court sent back a case against opposition Bobruisk City Councilman Ales MINSK 00001013 002.4 OF 003 Chigir to the police on the grounds that the district prosecutor had illegally charged him. According to the judge's decision, only a city prosecutor and prosecutors of a higher rank are authorized to issue a warrant against members of elected councils. Local police had charged Chigir with staging an unauthorized demonstration and with disobeying police orders in connection with Chigir's August 31 protest against being fired from his teaching position. Chigir believes the dismissal was in retaliation for his activities as the Mogilev regional head of opposition presidential candidate Aleksandr Milinkevich's recent campaign. He predicts the police will appeal the ruling. ¶6. Opposition Politician Sivchik Arrested in Minsk On September 12, police arrested former opposition Belarusian Popular Front (BPF) Deputy Chair Vyacheslav Sivchik while he was meeting with an independent journalist in a Minsk cafe. On March 29, police had unsuccessfully attempted to apprehend Sivchik as he was leaving a hospital where he received treatment for head injuries. Police severely beat him during the opposition "tent city" demonstration in Minsk's October Square following the March 19 presidential elections. On May 19, a judge sentenced Sivchik in absentia to ten days in jail under Part 1 of the Administrative Offenses Code's Article 167, which penalizes participation in an unauthorized demonstration. Sivchik reportedly had left Belarus and returned in mid-August. -------------- Trade and Investment -------------- ¶7. Belarusian Glass Factory, IKEA Negotiate Joint Venture On September 12, Belarus' Glass Factory Neman, based in the western Grodno region, announced talks with IKEA on joint production of 3,000 decorative lamps per year. IKEA is purportedly interested in a joint venture because of energy and loan preferences granted to Neman plant by President Lukashenko in exchange for increasing the state stake in the glass factory to 99.98 percent. Total state support for Neman is estimated to be USD 19.6 million. Neman was established in 1883 and went public in 2004. The factory produces more than 3,000 types of glassware and employs more than 4,000 people. Between January and August, Neman increased sales 22.8 percent on the year to USD 12.7 million. Meanwhile, Neman's exports rose 54 percent to USD 4.2 million. -------------- Domestic Economy -------------- ¶8. Oil Refining Industry Top Paying Employer in Belarus On September 13, the Belarusian Finance Ministry reported that the oil refining industry was the highest paying employer in Belarus during the first six months of 2006. During the period, monthly pay at oil refining enterprises averaged USD 602. In contrast, agricultural employees had the lowest monthly pay of USD 152, 70 percent lower than the national average. Bank employees' monthly pay topped the service sector at USD 443. At the bottom end of the sector were paramedics and nurses with an average pay of USD 142. Medical professionals and teachers were paid USD 407 and USD 420, respectively. Real average pay increased by 20.1 percent on the year in the first six months of 2006. In June, the average pay reportedly totaled USD 282, 18.5 percent more than in June 2005. Real income rose by 18.8 percent to USD 173 per capita. ¶9. Belarus' VISA Bankcards Turnover Up 110 Percent On September 12, VISA Area Manager Svetlana Georbelidze announced that Blarus' VISA bankcards' turnover rose 110 percent beween June 2005 and June 2006 to USD 2.19 billion During that period, the number of VISA cards i circulation rose 54.9 percent to 1.383 million. Meanwhile, there were 13.4 million payments with isa cards for goods and services, 3.8 times the pevious year, and the volume of payments reached SD 79.3 million, up 3.5 times. Salary cards accunt for 96 percent of all Visa cards in Belarus. Eleven Belarusian banks have become members of the VISA system, and two others have applied for membership recently. According to Georbelidze, the number of transactions with VISA cards in trade, services and public catering is rising faster than anywhere else in the Commonwealth of Independent States. -------------- Quote of the Week -------------- ¶10. During a visit to Belarus by a delegation of hunting experts from the Ukrainian State Forestry Committee, Belarusian Forestry Ministry Spokeswoman Ruzhena Novitskaya offered the following observation about Belarus' experience in breeding bison as proof of MINSK 00001013 003.4 OF 003 her country's comparative development: "As many as 680 bison are known to dwell in Belarus and, by the end of the year, their population is expected to reach 730, which is a good indicator against the background of other European countries." HOGAN