Suspicious Belarusian Trade

UNCLAS SECTION 01 OF 02 MINSK 000148

SIPDIS

SENSITIVE

SIPDIS

E.O. 12958: N/A
TAGS: ECON ETRD PREL USTR BO
SUBJECT: Suspicious Belarusian Trade



1. (SBU) Summary: In recent years, Minsk has actively sought to
increase trade and relations with pariah states as a counterbalance
to Western pressures to democratize and as evidence that
Lukashenko's rule is accepted abroad. Despite these efforts, trade
with these Outposts of Tyranny and State Sponsors of Terror only
accounted for 0.43% of Belarusian trade in the first nine months of

2005. In addition, the GOB publicly admits it is a major arms
exporter, but does not provide any public record or detail of arms
sales. These trade figures open a window to Belarus' opaque arms
transfers. The data shows relatively large exports to a number of
suspected buyers of Belarusian weapons, including Syria, Iran,
Libya, Eritrea, Algeria and others, with no or very low levels of
imports, indicating this is not normal bilateral trade. End
summary.


2. (U) These numbers only analyze Belarus' foreign trade for the
first nine months of 2005, the latest data available in detailed
form. A general analysis of Belarusian foreign trade can be found
septel.


Outposts of Tyranny/State Sponsors of Terror
--------------


3. (SBU) The GOB makes frequent pronouncements of successful and
growing trade with outposts of tyranny (as designated by Secretary
Rice in her January 2005 Senate confirmation hearing). Largely to
counter its political isolation, Minsk is seeking new friends and
markets among pariah states, and its external trade reflects this
trend. Of the five other "outposts of tyranny" (Cuba, Burma,
Zimbabwe, Iran, and North Korea; Belarus is the sixth),Belarus has
the strongest trade ties with Iran (USD 28.6 million in the first
nine months of the year) and Cuba (USD 17.2 million). Trade with
North Korea reached USD 5.5 million, Burma USD 471,100, and
Zimbabwe USD 398,300. Trade with North Korea, Iran, Zimbabwe and
Burma grew compared with 2004, by 203%, 111%, 157% and 9,059%
(although still at low levels) respectively. Trade with Cuba fell
by half compared to the year before.


4. (U) Belarus traded USD 29.5 million with Syria, a state sponsor
of terror, in the first nine months of 2005. Sudan, like Syria, is
another state sponsor of terror with which the GOB is continuously
working to improve relations. Bilateral trade with Sudan was only
USD 3.3 million. Trade with the last state sponsor of terror,
Libya, more than doubled to USD 14.9 million. For all three of
these countries, bilateral trade consisted almost entirely of
Belarusian exports, raising the possibility these numbers reflect
arms sales.


5. (U) Trade with these pariah states totaled USD 99.9 million, or
just 0.43% of Belarus' total trade. Despite Minsk's rhetoric and
attempts to expand political and economic ties with likeminded
regimes, these countries still constitute only a tiny percentage of
Belarus' foreign trade.


Suspicious Exports, Possibly Arms
--------------


6. (SBU) Belarus' export data shows suspiciously high levels of
exports to certain countries, not matched by correspondingly high
imports. The nature of these countries, and the disproportionate
level of exports from Belarus, compared to their neighbors,
indicates these countries are likely purchasing arms or dual-
purpose equipment from Minsk. This is especially true given the
large number of Soviet-era arms companies located in Belarus, and
the GOB's stated intention to remain one of the world's largest
arms exporters. For the first three quarters of 2005, trade with
these countries was (in US dollars):

Belarus' exports Belarus' imports

China 307.4 million 195.1 million
Syria 29.2 million 243,600
Iran 26.6 million 2.0 million
Libya 14.9 million zero
Eritrea 7.5 million zero
Algeria 4.4 million zero

N. Korea 3.8 million 1.6 million
Sudan 3.3 million 100
Djibouti 2.6 million zero
Angola 2.3 million 100
Ivory Coast 1.6 million 3.8 million

MINSK 00000148 002 OF 002


Yemen 90,000 zero


7. (SBU) Much of this might be legitimate, non-military trade.
However, given the opacity of Belarusian arms exports, the
political and military situations in these countries, and in many
cases their history of having purchased Belarusian weaponry, many
of these Belarusian exports are likely military goods.


Other Possible Arms Buyers
--------------


8. (SBU) There are a number of other countries with which Belarus
has a large trade surplus. Outside of petroleum products, which
mainly go to Europe, Belarus' main exports are potash and
trucks/trailers and military equipment, although the GOB does not
release data on arms sales. [Note: Again, much of this trade is
likely for civilian uses, but given the structure of Belarus'
exports, much of this probably is military or dual purpose. In
some of these cases, these countries may have little to sell to
Belarus. Given the complete opaqueness of Belarus' arms exports,
Post cannot authoritatively say which of these countries import
arms, and with which Belarus sim`ly has a strong trade surplus in
non-military goods.]

Belarus' exports Belarus' imports

India 136.9 million 34.9 million
Pakistan 48.3 million 2.6 million
Vietnam 30.5 million 1.7 million
Serbia 28.1 million 8.4 million
Egypt 27.1 million 4.9 million
Croatia 16.6 million 5.7 million
Venezuela 13.6 million 19,800
Cuba 10.2 million 7.0 million
Bangladesh 9.1 million 521,300
Afghanistan 9.0 million 81,100
Bosnia 8.1 million 26,600
Lebanon 7.7 million 52,600
Panama 5.2 million 46,700
Albania 5.1 million zero
Mongolia 4.7 million 6,400
Guinea 4.4 million zero
Jordan 3.6 million 62,800
Brunei 3.4 million 100
Nigeria 3.3 million 12,100
Saudi Arabia 2.5 million 306,900
Guatemala 1.4 million 15,700
Burkina Faso 1.1 million zero
Tanzania 818,700 24,100
Congo 621,000 zero
Sierra Leone 583,900 493,000
Burma 470,900 200
Senegal 258,800 2,800
Nepal 141,700 7,900
Iraq 78,200 zero


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


9. (SBU) Belarus' efforts to improve economic relations with pariah
states are limited by the simple fact that, other than weapons,
these countries have very little to offer each other. These
countries can certainly find political comfort in their common
isolation from the West, but despite Lukashenko's aggressive
rhetoric against the West, Belarus is becoming increasingly
dependent on Western markets. Trade with the United States alone,
Lukashenko's main public enemy, was three-and-a-half times higher
than with all the pariah states combined. Trade with democratic
neighbor Poland, another object of the state media's vitriolic
attacks, was ten times higher.

PHLIPOT