Identifier
Created
Classification
Origin
07MINSK18
2007-01-09 03:57:00
UNCLASSIFIED
Embassy Minsk
Cable title:
EMBASSY MINSK WEEKLY POL/ECON REPORT - JANUARY 5, 2007
how-toVZCZCXRO6292 RR RUEHAST RUEHDBU RUEHFL RUEHLA RUEHMRE RUEHROV RUEHSR DE RUEHSK #0018/01 0090357 ZNR UUUUU ZZH R 090357Z JAN 07 ZDK FM AMEMBASSY MINSK TO RUEHC/SECSTATE WASHDC 5500 INFO RUCNOSC/ORGANIZATION FOR SECURITY COOPERATION IN EUROPE RHMFISS/HQ USEUCOM VAIHINGEN GE RUFOADA/JAC MOLESWORTH RAF MOLESWORTH UK
UNCLAS SECTION 01 OF 03 MINSK 000018
SIPDIS
SIPDIS
E.O. 12958: N/A
TAGS: PGOV PREL PHUM ECON EPET ENRG BO
SUBJECT: EMBASSY MINSK WEEKLY POL/ECON REPORT - JANUARY 5, 2007
UNCLAS SECTION 01 OF 03 MINSK 000018
SIPDIS
SIPDIS
E.O. 12958: N/A
TAGS: PGOV PREL PHUM ECON EPET ENRG BO
SUBJECT: EMBASSY MINSK WEEKLY POL/ECON REPORT - JANUARY 5, 2007
1. The following are brief items of interest compiled by Embassy
Minsk.
TABLE OF CONTENTS
ELECTIONS
--------------
- Prosecutor Not to Investigate Election Fraud (para. 2)
DOMESTIC ECONOMY
--------------
- Finance Ministry to Adjust 2007 Budget (para. 3)
- Belarus Worst Country for Taxpayers (para. 4)
- Baranovichi Fabric Factories May be Privatized (para. 5)
INTERNATIONAL RELATIONS
--------------
- GOB Condemns Saddam's Hanging (para. 6)
- Suspected Belarusian Spy Appeals Extradition (para. 7)
INTERNATIONAL TRADE AND INVESTMENT
--------------
- Belarus Suspends Russian Oil Contracts (para. 8)
- Russia to Supply Belarus With Electricity (para. 9)
- Russian Customs Suspends Belarusian Sugar Release (para. 10)
CIVIL SOCIETY
--------------
- Kozulin Seeks Common Opposition Policy on Russia (para. 11)
- Pro-GOB Youth Picket Russian Embassy (para. 12)
- Polish Community Member Appeals Criminal Charge (para. 13)
- Roman Catholics Hunger Strike (para. 14)
- Opposition Youth Leader Awarded Literary Prize (para. 15)
- Former Parliamentary Candidate Charged (para. 16)
- QUOTE OF THE WEEK (para. 17)
--------------
ELECTIONS
--------------
2. Prosecutor Not to Investigate Election Fraud
On January 4, the Prosecutor General's Office notified United
Civic Party chairman Anatoliy Lebedko that it had rejected his
appeal to launch an investigation over Aleksandr Lukashenko's
statement that the 2006 presidential election was rigged. The
Prosecutor General's Office wrote that it did not have evidence
of election falsification.
--------------
DOMESTIC ECONOMY
--------------
3. Finance Ministry to Adjust 2007 Budget
On December 29, newly appointed Deputy Finance Minister Vladimir
Amarin announced that the Finance Ministry is prepared to amend
the 2007 State Budget Law to take into account the increase in
the price of Russian gas. The Finance Ministry made the
country's 2007 budgetary estimates in July and August 2006 based
on government's projections for a maximum 15-percent rise in the
price of Russian gas. Amarin also said the Ministry plans to use
USD 560 million of the National Development Fund, which receives
extra taxes from the best performing enterprises.
4. Belarus Worst Country for Taxpayers
On December 28, independent media reported international audit
experts naming Belarus as the worst country for taxpayers.
PricewaterhouseCoopers and the World Bank Group compared the
level of tax rates and tax collection methods across 175
economies. In Belarus, companies are subject to 12 taxes on
inputs and outputs and make approximately 125 payments to three
agencies by paper, spending an average of 1,188 hours. Tax
refunds take up to two years to process and despite the many
deductions and exemptions, in extreme cases companies' payments
can add up to 186 percent of profits causing 42 percent of
business activity within the country to go unrecorded.
5. Baranovichi Fabric Factories May be Privatized
On December 31, President Aleksandr Lukashenko tasked the
government with privatizing a group of cotton fabric factories in
Baranovichi, Brest region. The Minsk-based private lingerie
company, Serge, would receive control of the factories.
MINSK 00000018 002.2 OF 003
--------------
INTERNATIONAL RELATIONS
--------------
6. GOB Condemns Saddam's Hanging
On December 31, the Belarusian Foreign Minister's "Special
Representative for relations with European Parliamentary
Organizations" Sergey Gaydukevich condemned the execution of
Saddam Hussein as a hasty lynching. In 1982 and 1983,
Gaydukevich served as a Soviet military "expert" in Iraq.
Gaydukevich claimed that the execution would prove a symbol
towards further struggles against the United States and increase
tension within the divided nation.
7. Suspected Belarusian Spy Appeals Extradition
On January 2, the lawyer for Sergey Monich, a Belarusian citizen
wanted in Poland for alleged espionage, filed an appeal against
his extradition from Lithuania. The Vilnius County Court
approved extraditing Monich to Poland in accordance with the
European Convention on Extradition and Lithuanian regulations
after authorities arrested him in Vilnius on November 25 on
suspicion of spying against Poland.
--------------
INTERNATIONAL TRADE AND INVESTMENT
--------------
8. Belarus Suspends Russian Oil Contracts
On December 30, the Belarusian State Petrochemical Industry
Concern (Belneftekhim) suspended all 2007 contracts with Russian
oil companies, stating that the economy will suffer huge losses
if Belarusian companies continue buying oil from Russia. Russia
imposed an export duty of USD 180.1 per ton on crude oil
delivered to Belarus as of January 1.
9. Russia to Supply Belarus With Electricity
On January 3, Belarusian State Energy Concern aide Vladimir
Korduba announced that Russia's national power utility has
contracted to supply Belarus with 3.5 billion kilowatt-hours of
electricity this year for an undisclosed value. This statement
contradicts a public comment by Russian Ambassador Aleksandr
Surikov in November 2006 that Russia would not sell electricity
to Belarus in 2007 due to increased domestic use.
10. Russian Customs Suspends Belarusian Sugar Release
On January 3, Belarusian State Food Industry Concern
(Belpisheprom) Head Ivan Danchenko said that the customs
clearance of Belarusian sugar heading for Russia was again
suspended on December 29. Belarusian sugar producers have been
experiencing customs delays as the Russian Union of Sugar
Manufacturers complained that the sugar was made from imported
raw cane sugar instead domestically refined sugar beets.
Belarusian sugar producers claim losses of approximately USD 2
million and 50 percent of their sales due to the delays.
--------------
CIVIL SOCIETY
--------------
11. Kozulin Seeks Common Opposition Policy on Russia
On December 30, imprisoned former presidential candidate
Aleksandr Kozulin urged Belarusian opposition forces to present
Moscow with a common opposition strategy for Belarusian relations
with Russia. The previous day, Kozulin's wife Irina denied media
reports that her husband was hospitalized. She stated that
although he was examined at the Vitebsk Regional Hospital in
connection with his recent hunger strike, authorities returned
him to the prison the same day. Kozulin conducted his hunger
strike from October 20 through December 11 to protest the illegal
reelection of Aleksandr Lukashenko for a third term and draw the
UN Security Council's attention to the situation in Belarus.
12. Pro-GOB Youth Picket Russian Embassy
On December 29, 50-60 pro-government Belarusian National Youth
Union activists picketed the Russian embassy in Minsk displaying
Belarusian and Russian flags and chanting to protest an expected
rise in the gas price for Belarus and a possible gas cutoff. The
protesters, who played to state media, displayed posters with
various anti-Gazprom and pro-Union State slogans.
13. Polish Community Member Appeals Criminal Charge
On December 29, the lawyer for Mieczyslaw Jaskiewicz, an activist
MINSK 00000018 003 OF 003
from the Polish community in Belarus, appealed to drop a
hooliganism charge in connection with a November 5 fight. The
appeal claimed that the client's actions had not constituted any
crime and the witnesses' reports contradicted each other.
Authorities failed to notify Jaskiewicz of the charge against him
until December 27.
14. Roman Catholics End Hunger Strike
On December 28, Roman Catholics in the village of Lazduny, Grodno
region, went on a hunger strike to protest the authorities'
refusal to extend the Belarusian visa of Polish priest Mariusz
Iliaszewicz. The priest has served the community for 13 years.
The parishioners suspended the hunger strike on December 31 after
learning that Grodno Regional Executive Committee chair Vladimir
Savchenko had agreed to discuss their demands. On January 3, the
Roman Catholic community e-mailed a letter to Aleksandr
Lukashenko asking him to extend their priest's visa. (On
September 20, 2006, authorities refused to extend the visas of 12
Roman Catholic priests in the Grodno Diocese, citing the need to
provide young priests with positions.)
15. Opposition Youth Leader Awarded Literary Prize
On December 29, independent media reported that the Belarusian
PEN Board awarded the 2006 Ales Adamovich Literary Prize to
convicted opposition youth leader Pavel Severinets for his recent
series of stories "Letters from the Forest" published by the
private newspaper "Nasha Niva." Severinets was sentenced to
three years of restricted freedom in May 2005 for staging
unauthorized demonstrations against the fraudulent 2004
parliamentary elections.
16. Former Parliamentary Candidate Charged
On January 3, authorities brought a formal charge of resisting
police against Konstantin Lukashov, a candidate in Belarus' 2004
parliamentary elections. Authorities charged Lukashov on his 15
day of detention in connection with a police attempt to arrest
his half-brother prominent opposition activist Vyacheslav
Sivchik, on March 29. Plainclothes police flashing police ID
cards attempted to arrest Sivchik as he was leaving the hospital
in Minsk, saying that he had been charged with disorderly
conduct.
--------------
QUOTE OF THE WEEK
--------------
17. On January 1, during his traditional New Year's address to
the nation President Aleksandr Lukashenko warned the Belarusian
people:
"We should be ready for having to make difficult and unusual
decisions because those seeking to grab little morsels of
property in Belarus will not abandon their attempts to break us
economically and politically."
MOORE
SIPDIS
SIPDIS
E.O. 12958: N/A
TAGS: PGOV PREL PHUM ECON EPET ENRG BO
SUBJECT: EMBASSY MINSK WEEKLY POL/ECON REPORT - JANUARY 5, 2007
1. The following are brief items of interest compiled by Embassy
Minsk.
TABLE OF CONTENTS
ELECTIONS
--------------
- Prosecutor Not to Investigate Election Fraud (para. 2)
DOMESTIC ECONOMY
--------------
- Finance Ministry to Adjust 2007 Budget (para. 3)
- Belarus Worst Country for Taxpayers (para. 4)
- Baranovichi Fabric Factories May be Privatized (para. 5)
INTERNATIONAL RELATIONS
--------------
- GOB Condemns Saddam's Hanging (para. 6)
- Suspected Belarusian Spy Appeals Extradition (para. 7)
INTERNATIONAL TRADE AND INVESTMENT
--------------
- Belarus Suspends Russian Oil Contracts (para. 8)
- Russia to Supply Belarus With Electricity (para. 9)
- Russian Customs Suspends Belarusian Sugar Release (para. 10)
CIVIL SOCIETY
--------------
- Kozulin Seeks Common Opposition Policy on Russia (para. 11)
- Pro-GOB Youth Picket Russian Embassy (para. 12)
- Polish Community Member Appeals Criminal Charge (para. 13)
- Roman Catholics Hunger Strike (para. 14)
- Opposition Youth Leader Awarded Literary Prize (para. 15)
- Former Parliamentary Candidate Charged (para. 16)
- QUOTE OF THE WEEK (para. 17)
--------------
ELECTIONS
--------------
2. Prosecutor Not to Investigate Election Fraud
On January 4, the Prosecutor General's Office notified United
Civic Party chairman Anatoliy Lebedko that it had rejected his
appeal to launch an investigation over Aleksandr Lukashenko's
statement that the 2006 presidential election was rigged. The
Prosecutor General's Office wrote that it did not have evidence
of election falsification.
--------------
DOMESTIC ECONOMY
--------------
3. Finance Ministry to Adjust 2007 Budget
On December 29, newly appointed Deputy Finance Minister Vladimir
Amarin announced that the Finance Ministry is prepared to amend
the 2007 State Budget Law to take into account the increase in
the price of Russian gas. The Finance Ministry made the
country's 2007 budgetary estimates in July and August 2006 based
on government's projections for a maximum 15-percent rise in the
price of Russian gas. Amarin also said the Ministry plans to use
USD 560 million of the National Development Fund, which receives
extra taxes from the best performing enterprises.
4. Belarus Worst Country for Taxpayers
On December 28, independent media reported international audit
experts naming Belarus as the worst country for taxpayers.
PricewaterhouseCoopers and the World Bank Group compared the
level of tax rates and tax collection methods across 175
economies. In Belarus, companies are subject to 12 taxes on
inputs and outputs and make approximately 125 payments to three
agencies by paper, spending an average of 1,188 hours. Tax
refunds take up to two years to process and despite the many
deductions and exemptions, in extreme cases companies' payments
can add up to 186 percent of profits causing 42 percent of
business activity within the country to go unrecorded.
5. Baranovichi Fabric Factories May be Privatized
On December 31, President Aleksandr Lukashenko tasked the
government with privatizing a group of cotton fabric factories in
Baranovichi, Brest region. The Minsk-based private lingerie
company, Serge, would receive control of the factories.
MINSK 00000018 002.2 OF 003
--------------
INTERNATIONAL RELATIONS
--------------
6. GOB Condemns Saddam's Hanging
On December 31, the Belarusian Foreign Minister's "Special
Representative for relations with European Parliamentary
Organizations" Sergey Gaydukevich condemned the execution of
Saddam Hussein as a hasty lynching. In 1982 and 1983,
Gaydukevich served as a Soviet military "expert" in Iraq.
Gaydukevich claimed that the execution would prove a symbol
towards further struggles against the United States and increase
tension within the divided nation.
7. Suspected Belarusian Spy Appeals Extradition
On January 2, the lawyer for Sergey Monich, a Belarusian citizen
wanted in Poland for alleged espionage, filed an appeal against
his extradition from Lithuania. The Vilnius County Court
approved extraditing Monich to Poland in accordance with the
European Convention on Extradition and Lithuanian regulations
after authorities arrested him in Vilnius on November 25 on
suspicion of spying against Poland.
--------------
INTERNATIONAL TRADE AND INVESTMENT
--------------
8. Belarus Suspends Russian Oil Contracts
On December 30, the Belarusian State Petrochemical Industry
Concern (Belneftekhim) suspended all 2007 contracts with Russian
oil companies, stating that the economy will suffer huge losses
if Belarusian companies continue buying oil from Russia. Russia
imposed an export duty of USD 180.1 per ton on crude oil
delivered to Belarus as of January 1.
9. Russia to Supply Belarus With Electricity
On January 3, Belarusian State Energy Concern aide Vladimir
Korduba announced that Russia's national power utility has
contracted to supply Belarus with 3.5 billion kilowatt-hours of
electricity this year for an undisclosed value. This statement
contradicts a public comment by Russian Ambassador Aleksandr
Surikov in November 2006 that Russia would not sell electricity
to Belarus in 2007 due to increased domestic use.
10. Russian Customs Suspends Belarusian Sugar Release
On January 3, Belarusian State Food Industry Concern
(Belpisheprom) Head Ivan Danchenko said that the customs
clearance of Belarusian sugar heading for Russia was again
suspended on December 29. Belarusian sugar producers have been
experiencing customs delays as the Russian Union of Sugar
Manufacturers complained that the sugar was made from imported
raw cane sugar instead domestically refined sugar beets.
Belarusian sugar producers claim losses of approximately USD 2
million and 50 percent of their sales due to the delays.
--------------
CIVIL SOCIETY
--------------
11. Kozulin Seeks Common Opposition Policy on Russia
On December 30, imprisoned former presidential candidate
Aleksandr Kozulin urged Belarusian opposition forces to present
Moscow with a common opposition strategy for Belarusian relations
with Russia. The previous day, Kozulin's wife Irina denied media
reports that her husband was hospitalized. She stated that
although he was examined at the Vitebsk Regional Hospital in
connection with his recent hunger strike, authorities returned
him to the prison the same day. Kozulin conducted his hunger
strike from October 20 through December 11 to protest the illegal
reelection of Aleksandr Lukashenko for a third term and draw the
UN Security Council's attention to the situation in Belarus.
12. Pro-GOB Youth Picket Russian Embassy
On December 29, 50-60 pro-government Belarusian National Youth
Union activists picketed the Russian embassy in Minsk displaying
Belarusian and Russian flags and chanting to protest an expected
rise in the gas price for Belarus and a possible gas cutoff. The
protesters, who played to state media, displayed posters with
various anti-Gazprom and pro-Union State slogans.
13. Polish Community Member Appeals Criminal Charge
On December 29, the lawyer for Mieczyslaw Jaskiewicz, an activist
MINSK 00000018 003 OF 003
from the Polish community in Belarus, appealed to drop a
hooliganism charge in connection with a November 5 fight. The
appeal claimed that the client's actions had not constituted any
crime and the witnesses' reports contradicted each other.
Authorities failed to notify Jaskiewicz of the charge against him
until December 27.
14. Roman Catholics End Hunger Strike
On December 28, Roman Catholics in the village of Lazduny, Grodno
region, went on a hunger strike to protest the authorities'
refusal to extend the Belarusian visa of Polish priest Mariusz
Iliaszewicz. The priest has served the community for 13 years.
The parishioners suspended the hunger strike on December 31 after
learning that Grodno Regional Executive Committee chair Vladimir
Savchenko had agreed to discuss their demands. On January 3, the
Roman Catholic community e-mailed a letter to Aleksandr
Lukashenko asking him to extend their priest's visa. (On
September 20, 2006, authorities refused to extend the visas of 12
Roman Catholic priests in the Grodno Diocese, citing the need to
provide young priests with positions.)
15. Opposition Youth Leader Awarded Literary Prize
On December 29, independent media reported that the Belarusian
PEN Board awarded the 2006 Ales Adamovich Literary Prize to
convicted opposition youth leader Pavel Severinets for his recent
series of stories "Letters from the Forest" published by the
private newspaper "Nasha Niva." Severinets was sentenced to
three years of restricted freedom in May 2005 for staging
unauthorized demonstrations against the fraudulent 2004
parliamentary elections.
16. Former Parliamentary Candidate Charged
On January 3, authorities brought a formal charge of resisting
police against Konstantin Lukashov, a candidate in Belarus' 2004
parliamentary elections. Authorities charged Lukashov on his 15
day of detention in connection with a police attempt to arrest
his half-brother prominent opposition activist Vyacheslav
Sivchik, on March 29. Plainclothes police flashing police ID
cards attempted to arrest Sivchik as he was leaving the hospital
in Minsk, saying that he had been charged with disorderly
conduct.
--------------
QUOTE OF THE WEEK
--------------
17. On January 1, during his traditional New Year's address to
the nation President Aleksandr Lukashenko warned the Belarusian
people:
"We should be ready for having to make difficult and unusual
decisions because those seeking to grab little morsels of
property in Belarus will not abandon their attempts to break us
economically and politically."
MOORE