NATIONAL BANK CHAIR MAY SUCCEED SIDORSKIY AS PM

C O N F I D E N T I A L SECTION 01 OF 02 MINSK 000993

SIPDIS

SIPDIS

E.O. 12958: DECL: 12/04/2017
TAGS: PGOV ECON PINR BO
SUBJECT: NATIONAL BANK CHAIR MAY SUCCEED SIDORSKIY AS PM

Ref: A) Minsk 003

B) Minsk 915

Classified By: Charge Jonathan Moore for reason 1.4 (d).

Summary
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1. (C) While talk of the imminent sacking of Belarusian
Premier Sergey Sidorskiy has circulated for some time,
rumors are increasing regarding one likely successor,
Chairman of the Board of the National Bank of Belarus Pyotr
Prokopovich. A civil engineer by training, Prokopovich is
a long-time member of Aleksandr Lukashenko's inner circle.
He combines a degree of professionalism, with management
skills, a lack of ambition and fierce loyalty to Lukashenko
-- an array of traits that could make him an ideal head of
government in the dictator's eyes, particularly as Belarus
faces economic challenges in the months to come.
Biographical information on Prokopovich is included in
paragraphs 5-7 below. End summary.

Rumors Increasingly Circle Around Prokopovich
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2. (C) Since the January 2007 price increase for Russian
gas (ref A),rumors have circulated in Minsk that Aleksandr
Lukashenko was about to dismiss Premier Sergey Sidorskiy.
Lately, however, these rumors have developed and now
increasingly include discussion of a likely successor, the
Chairman of the Board of the National Bank of Belarus,
Pyotr Prokopovich. Recently, independent political analyst
Vitaliy Silitskiy of the Belarus Institute of Strategic
Studies told the DCM that if and when Lukashenko decided to
dismiss his government, he was likely to turn to
Prokopovich as a successor. Silitskiy confided to the DCM
that the National Bank head is known for having a modicum
of economic skills -- primarily as proven by his ability to
find money for Lukashenko when the dictator needs it.


3. (C) Vladimir Podgol, an opposition figure who analyzes
Lukashenko's media appearances (and produces compilations
of his "greatest hits"),told Pol/Econ Chief that
Prokopovich had taken an unusually active role in a
November session of the Cabinet of Ministers, and had been
quite critical of certain GOB economic policies. According
to Podgol, the fact that Lukashenko had not criticized
Prokopovich immediately could be interpreted as a sign that
Prokopovich's interventions had Lukashenko's support.
Moreover, Podgol said that Prokopovich was immersing
himself in the details of economic laws and regulations and
that Lukashenko's eventual nomination of Prokopovich could
be a sign that the dictator was prepared to yield to market
realities and to begin to reform the Belarusian economy.


4. (C) Igor Pelipas, Director of Research for the
independent Institute for Privatization and Management,
also agreed that a change of government might be in the
cards in Belarus. He said that Lukashenko's recent
statements calling nine per cent GDP growth insufficient,
and demanding the government reach eleven per cent growth,
looked like an attempt to task Sidorskiy with the
impossible, as a prelude to sacking him. Pelipas noted,
however, that while a change of government often signaled a
change of course in policy, he was by no means convinced
that Lukashenko was ready for that.

Like Lukashenko, Prokopovich is a Soviet Belarusian
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5. (C) Like the dictator's (ref B),Pyotr Petrovich
Prokopovich's biography is both Soviet and Belarusian.
Born in Rovno, Brest Oblast, in 1942, Prokopovich graduated
from the Dnepropetrovsk Institute of Engineering and
Construction in 1966 with a degree in civil engineering.
He started working as a mason and quickly rose to the top
of his firm, and later to the leadership of a large Soviet
construction conglomerate, working in the Sverdlovsk Oblast
in Russia, in Kazakhstan, and ultimately in his native
Belarus. Prokopovich served in numerous local Soviet
legislatures as well as in the Twelfth Supreme Soviet of
the Belarusian Soviet Socialist Republic (1990-1995).


6. (C) Prokopovich was head of Brest Oblast's Planning and
Construction Association from 1976 to 1996. At the
national level, his executive experience includes stints as
Deputy Head of Lukashenko's Presidential Administration
(1996) and as First Deputy Premier of Belarus with an
economic/social development portfolio (1996-98). He is one

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of the few men who can command Lukashenko's attention, and,
for his part, Prokopovich has been a loyal financier and
ideologue for the regime. In his first interview after
being named Central Bank Chair in 1998, Prokopovich stated
unequivocally that job number one for the Central Bank,
Belarus' credit and monetary policies and for the entire
Belarusian banking sector was the achievement of
Lukashenko's "Program for Economic and Social Development
by the Year 2000." Prokopovich is married, and the father
of two.

Prokopovich Q The Ideal Deputy
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7. (C) In describing Prokopovich, Vladimir Podgol said
that he was hard working, free of ambition, and extremely
loyal to Lukashenko, in short, "the ideal deputy." Igor
Pelipas told Pol/Econ Chief that when Prokopovich was named
Head of the National Bank of Belarus he was the butt of
jokes from bankers and economists, and little was expected
of him. According to Pelipas, Prokopovich's leadership at
the Central Bank has been positive. He opined that perhaps
Prokopovich's success there was due to the fact that he had
hired young, talented staff and let them do their jobs.
Pelipas warned, however, that Prokopovich's success as a
central banker might not be entirely applicable to future
work as head of government.

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


8. (C) Discussion of Prokopovich indicates the regime's
unease with the current economic situation while confirming
the lack of interest in any political reforms. In a land
where fates are decided according to the caprice of an
authoritarian peasant, predicting political decisions is
less than science. With Russian gas prices set to jump
again after January 1, 2008, and the coldest part of winter
ahead, the thought that Lukashenko might dismiss Sergey
Sidorskiy sometime early in 2008 seems eminently plausible.
Similarly, with fat Russian hydrocarbon subsidies a thing
of the past and personal loyalty to Lukashenko being
today's defining political virtue here, the nomination of a
loyalist with monetary policy skills as head of government
also seems quite plausible. That said, like Pelipas, we
are less than convinced that either a change of government
or an eventual Prokopovich premiership will signal real
economic reform.

Moore