EMBASSY MINSK WEEKLY POL/ECON REPORT - SEPTEMBER 26,

UNCLAS SECTION 01 OF 03 MINSK 001050 SIPDIS SIPDIS E.O. 12958: N/A TAGS: PGOV PREL PHUM ECON EPET ENRG KTDB BO SUBJECT: EMBASSY MINSK WEEKLY POL/ECON REPORT - SEPTEMBER 26, 2006 MINSK 00001050 001.2 OF 003 ¶1. The following are brief items of interest compiled by Embassy Minsk. TABLE OF CONTENTS INTERNATIONAL RELATIONS -------------- - Date Announced for CIS October Summit in Minsk (para. 2) - Belarus' Foreign Minister to Address UNGA (para. 3) - Foreign Ministries of Belarus, Iran Consult in Tehran (para. 4) - Bearus, China Consider Easing Visa Procedures (para.5) CIVIL SOCIETY -------------- - Minsk City Court Rejects Kozulin's Appeal (para. 6) - Kozuln Threatens Hunger Strike, Wants Shadow Cabinet (pra. 7) - Opposition Leader Released after 10 Day in Jail (para. 8) - Information Ministry Suspens Magazine "Arche" (para. 9) TRADE AND INVESTMENT -------------- - Russia Seeks Lion's Share of Belarus' Export Duties (para. 10) - Belarus May Make Iranian Samand under Its Own Brand (para. 11) DOMESTIC ECONOMICS -------------- - Statistics Ministry Reports 60,000 Jobless in August (para. 12) - Belarus' Gas Pipeline Transit Up Seven Percent on Year (para. 13) - QUOTE OF THE WEEK (para. 14) -------------- International Relations -------------- ¶2. Date Announced for CIS October Summit in Minsk On September 21, a source in the Commonwealth of Independent States (CIS) Executive revealed to Belarusian independent media that the CIS summit would be held October 16-17 in Minsk. Kazakhstan, which currently chairs the alliance, reportedly has approved the agenda. Foreign ministers and the heads of government are scheduled to hold their sessions on October 16. Heads of state will meet the following day. The CIS High-Level Group for Increasing Efficiency will submit to the heads of state proposals for reform of the CIS, including a draft agreement on Turkmenistan's associate membership and a statement on cooperation in countering illegal migration. The heads of state are also expected to sign agreements on the prevention of money laundering, terrorist financing, and combating human trafficking. ¶3. Belarus' Foreign Minister to Address UNGA On September 21, Belarusian Foreign Ministry spokesman Andrei Popov announced that Foreign Minister Sergei Martynov will participate in a general political discussion at the 61st session of the UN General Assembly between September 24 and 27. Martynov will articulate Belarus' positions on issues of international security, including the Middle East and reform of the United Nations. According to Popov, Martynov hopes to garner support for Belarus' proposals for development and a global partnership against slavery and human trafficking that were offered by President Lukashenko at the 2005 World Summit. ¶4. Foreign Ministries of Belarus, Iran Consult in Tehran On September 18-19, the foreign ministries of Belarus and Iran held a round of consultations in Tehran. Belarus' Deputy Foreign Minister Viktor Gaisenok and Iranian Deputy Foreign Minister for Asia-Pacific Affairs Mehdi Safari led discussions on trade, investment and banking, and transportation. Gaisenok also met with Iranian Trade Minister Mohammad Shariatmadari, who co-chairs the Belarusian-Iranian commission for economic cooperation. In addition, Gaisenok visited Belarus' section at an international fair in Tehran and attended the opening ceremony for a Belarusian- Iranian economic conference. ¶5. Belarus, China Consider Easing Visa Procedures On September 19, representatives from the Belarusian and Chinese foreign ministries met in Minsk to discuss easing visa procedures. The Belarusian delegation was led by Oleg Karnachev, head of the passport and visa office of the consular department, and the Chinese delegation was headed by Zhang Ligo, deputy director MINSK 00001050 002.2 OF 003 general of the Department of Consular Affairs. The meeting also covered consular protection, the prevention of illegal immigration, and exchange of information. -------------- Civil Society -------------- ¶6. Minsk City Court Rejects Kozulin's Appeal On September 19, in a session attended by Poloff, the Minsk City Court judicial board rejected former opposition presidential candidate Aleksandr Kozulin's appeal to overturn his politically motivated prison sentence of five and a half years for alleged "hooliganism" and disturbing the peace. Kozulin's defense team cited numerous violations of Belarus' Criminal Procedure Code as proof that Judge Aleksey Rybakov failed to hold an unbiased trial. The prosecutor denied any grounds for reviewing the verdict. Following the appeal, authorities transferred Kozulin to a minimum security correctional labor facility in the northern village of Vitba near Vitebsk, where he is to serve out his prison term. ¶7. Kozulin Threatens Hunger Strike, Wants Shadow Cabinet On September 20, imprisoned former opposition presidential candidate Aleksandr Kozulin threatened an open-ended hunger strike beginning on October 20 in protest against President Lukashenko's third term in office. Kozulin called on the Belarusian opposition to convene a meeting for the formation of a shadow cabinet. According to Kozulin, the meeting should include current government officials, the Belarusian National Assembly, representatives of the Belarusian diaspora, and members of the 13th Supreme Soviet, which Lukashenko dissolved following the controversial 1996 constitutional referendum. Kozulin also urged non-governmental organizations and the Political Council of the United Democratic Forces opposition coalition to create a tribunal commission for trying Lukashenko. He stressed that "justice and the rule of law should be restored" in the country. He warned that otherwise Belarus might lose its independence, language, culture and people. ¶8. Opposition Leader Released after 10 Days in Jail On September 22, authorities released opposition activist Vyacheslav Sivchik. On September 18, Minsk Tsentralniy District Court Judge Inna Sheyko had sentenced Sivchik to 10 days in jail with six days time served for his role in an unauthorized three-day opposition demonstration in October Square after Belarus' March 19 presidential election. Sivchik was convicted in May, but the Minsk City Court invalidated the sentence because he was tried in absentia. Sivchik's defense team plans to appeal to the Minsk City Court and the city prosecutor's office to overturn the ruling. Sivchik was severely beaten by police at the opposition "tent city" in October Square on March 23. He fled to Ukraine shortly after authorities attempted to arrest him at the hospital where he sought treatment for his injuries. He returned to Belarus in mid-August. ¶9. Information Ministry Suspends Magazine "Arche" On September 21, independent media reported that Belarus' Ministry of Information has suspended the Belarusian-language intellectual magazine "Arche" for three months. In its letter to "Arche" Editor- in-Chief Valery Bulgakov, the ministry accused the monthly magazine of publishing articles about politics in violation of its license and cited the magazine's September issue whose cover features a photograph of police officers violently dispersing anti-government protesters in 1995. Bulgakov pledged to appeal the suspension and insisted the article in question, published under the headline "Crackdown: Recollections of 12th Supreme Soviet Deputies," is about history, not politics. Article 11 of Belarus' Media Law requires publications to notify the Ministry of Information one month in advance about changes in the subjects they cover. In 2005, the magazine filed a request with the Ministry of Information for permission to publish articles about politics but received no official reply. -------------- Trade and Investment -------------- ¶10. Russia Seeks Lion's Share of Belarus' Export Duties On September 20, independent media reported that the Russian government is demanding a larger share of export duties on oil products produced from Russian oil at Belarusian refineries. The GOR will reportedly ask the GOB for 85 percent of the duties, which could bring USD 350 million to the Russian budget every year. Subsidiaries of Russian firms supply duty-free oil to Belarusian refineries and export oil products with low Belarusian duties to Western Europe. MINSK 00001050 003.2 OF 003 ¶11. Belarus May Make Iranian Samand Under Its Own Brand On September 21, Belarusian First Deputy Minister of the Interior Ivan Demidovich predicted that Belarus' closed joint stock company ZAO Yunison could produce Iran Khodro's Samand cars under a Belarusian brand name. Yunison began production of Samand vehicles in August and expects to produce 1,000 Samands by the end of 2006. The company's goal for 2007 is 5,000 to 6,000 vehicles. Ultimately, Yunison hopes to increase annual Samand output to 50,000 to 60,000 vehicles. Under the current agreement between Yunison and Iran Khodro, Samands assembled in Belarus may be exported to Europe and Russia only with the consent of Yunison's Iranian partners. The Samand is based on the Peugeot 405 platform and is produced by Iran Khodro, reputedly the largest producer of motorcars and buses in the Middle East. -------------- Domestic Economy -------------- ¶12. Statistics Ministry Reports 60,000 Jobless in August On September, the Ministry of Statistics and Analysis reported that the official number of unemployed persons in Belarus totaled 60,000 by the end of August 2006, a 17.8-percent decrease since August ¶2005. Belarus' official unemployment rate was 1.4 percent of the economically active population, 0.2 percentage point lower than a year ago. Unemployment was higher in the Brest, Mogilyov and Vitebsk regions, 1.7 percent, than in Minsk, which had the lowest rate of 0.7 percent. By September, 203,000 people reportedly applied for employment assistance, of whom 135,000 were officially recognized as unemployed. Meanwhile, employment centers helped 133,000 people find jobs in the period. About 83 percent of all vacancies were factory jobs. Employment centers reportedly organized job training courses for 16,000 persons and assigned about 62,000 to do community work, including 43,000 unemployed. The average unemployment allowance in August was USD 20. ¶13. Belarus' Gas Pipeline Transit Up Seven Percent on Year On September 21, the Belarusian Ministry of Statistics and Analysis reported that natural gas transportation through Belarus' pipeline system increased seven percent on the year between January and August to 44.4 billion cubic meters. Meanwhile, Belarus' natural gas imports increased 5.2 percent to 13.5 billion cubic meters. Gas transit via Belarus' pipelines increased 8 percent to 30.9 billion cubic meters. Of that total, Russia's gas transit via Belarus' pipelines to Poland accounted for 70 percent, to Ukraine 20 percent, and to Lithuania eight percent. The profitability of Belarus' pipeline companies dropped 47.8 percent between January and July from 64 percent in that period of 2005. In 2005, gas transportation via Belarus rose 10.8 percent to 60.9 billion cubic meters. -------------- Quote of the Week -------------- ¶14. Following the recent summit of the Non-Aligned Movement in Havana, President Lukashenko told a BBC interviewer: "If the United States believes that we are a sovereign state, which we are, they should act in accordance with this belief instead of lording it over us or pressing us. We deserve to be talked to as a sovereign state. We do not want much. We just want normal cooperation that will be of benefit to our state. If the Americans agree, we are ready to cooperate with them as early as tomorrow." Stewart