Identifier
Created
Classification
Origin
09MINSK322
2009-09-18 16:44:00
UNCLASSIFIED
Embassy Minsk
Cable title:
BELARUS WEEKLY POL/ECON REPORT - SEPTEMBER 18, 2009
how-toVZCZCXRO9319 RR RUEHAG RUEHAST RUEHDA RUEHDBU RUEHDF RUEHFL RUEHIK RUEHKW RUEHLA RUEHLN RUEHLZ RUEHNP RUEHPOD RUEHROV RUEHSL RUEHSR RUEHVK RUEHYG DE RUEHSK #0322/01 2611644 ZNR UUUUU ZZH R 181644Z SEP 09 FM AMEMBASSY MINSK TO RUEHC/SECSTATE WASHDC 0482 INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE RUEHSK/AMEMBASSY MINSK 0489
UNCLAS SECTION 01 OF 03 MINSK 000322
SIPDIS
E.O. 12958: N/A
TAGS: PGOV PREL PHUM ECON BO
SUBJECT: BELARUS WEEKLY POL/ECON REPORT - SEPTEMBER 18, 2009
MINSK 00000322 001.2 OF 003
UNCLAS SECTION 01 OF 03 MINSK 000322
SIPDIS
E.O. 12958: N/A
TAGS: PGOV PREL PHUM ECON BO
SUBJECT: BELARUS WEEKLY POL/ECON REPORT - SEPTEMBER 18, 2009
MINSK 00000322 001.2 OF 003
1. The following are brief items of interest compiled by
Embassy Minsk.
TABLE OF CONTENTS
Civil Society
--------------
- GOB, Lithuania Defer Agreement on Simplified Border Crossing
(para. 2)
- GOB Continues to Harass and Fine Opposition Activists (para. 3)
- Riot Police Disperse an Opposition Demonstration Yet Again
(para. 4)
Economy
--------------
- Customs Union to Fine-tune Distribution of Import Incomes
(para. 5)
- IMF Issued $448.7 Million Worth of SDR's to Belarus (para. 6)
- Issuance of WB loan Will Depend on Belarus' Compliance With
Its IMF SBA (para. 7)
- WB and IFC Praise GOB for Reforming Economy But Make it Clear
"There is Still Room For Improvement" (para. 8)
- Through-August GDP Down 0.5 Percent Year-On-Year (para. 9)
- Finance Ministry Posted 1.3 Percent Budget Deficit Through
July (para. 10)
- Vice Premier: Less Inspections, But They Are More Efficient
(para. 11)
- Lukashenka Streamlines Granting State Support to the Needy
(para. 12)
International Security
--------------
- Joint Military Exercise Starts in Belarus (para. 13)
Quote of the Week (para. 14)
--------------
--------------
Civil Society
--------------
2 GOB, Lithuania Defer Agreement on Simplified Border Crossing
Chiefs of the Belarus and Lithuania border agencies signed a
border agreement. The document outlines procedures for
maintenance of the shared border, movement of goods, economic
and other activities at the border zone and resolution of
incidents. According to the Lithuanian MFA spokesperson,
Lithuania and GOB did not endorse an agreement on visa-free
travel between the two countries within the 50-kilometer border
zone because the GOB ostensibly "requested additional time to
finalize internal procedures." (BelaPAN, Delfi.lt, September
16)
3. GOB Continues to Harass and Fine Opposition Activists
A Vitebsk district court fined on September 15 Sergey Kovalenko,
local Conservative Christian Party member, $375 for allegedly
displaying an opposition white-red-white flag. Police detained
and questioned Kovalenko and his associate Taras Surgan, a Young
Belarus activist, on September 14. In a separate incident on
September 14, a Minsk district court fined "European Belarus"
civil campaign activist Maksim Sergiyets $250 for participating
in a September 9 rally against the Russian-Belarusian military
exercises named Zapad-2009. In another case in Mozyr, civil
society activist Pavel Nozdrya was fined $37 for allegedly
violating military registration procedures. A local draft
office claimed that Nozdrya failed to timely notify them that he
had changed a place of his employment.
4. Riot Police Disperse an Opposition Demonstration Yet Again
Riot police dispersed yet another unauthorized opposition rally,
this one marking the 10th anniversary of high-profile
disappearance in downtown Minsk on September 16. EMBOFFs
observed that as in a similar incident on September 9, law
enforcement officers surrounded the protesters 10 minutes after
they had assembled at the site and shoved about 35 of them into
police buses. They also impeded journalists taking pictures of
the dispersal. All the protesters were reportedly released with
no charges after a three-hour detention; however, many of the
activists report being assaulted, harassed, threatened with
physical abuse, and forced to give fingerprints. In a separate
incident in Gomel, police detained 16 local activists on their
way to a rally venue on September 16. Ten were charged with
holding an unsanctioned demonstration and released three hours
later. They maintained that they would appeal their detention
to the prosecutor's office.
--------------
MINSK 00000322 002.2 OF 003
Economy
--------------
5. Customs Union to Fine-tune Distribution of Import Incomes
According to media reports, the Executive Secretary of the
Commission of the Belarus, Russia and Kazakhstan Customs Union
Sergei Glaziev stated on September 14 that import incomes of the
Union will be distributed based on macroeconomic criteria that
have yet to be identified. The three member-states will
reportedly work independently in their national currencies but
later funds will be deposited into a single account. Export
duties, however, will be contributed directly to the budget.
The Union expects to reach an agreement on a unified tariff by
November of this year with the goal of it taking effect on
January 1, 2010. The single Customs Code is expected to come
into effect on July 1, 2010. Customs law of the Union will
include both the Customs Code and decisions of the Commission.
6. IMF Issued $448.7 Million Worth of Special Drawing Rights to
Belarus
Natalya Kolyadina, IMF Resident Representative in Minsk, told
Prime-TASS news agency on September 11 that the IMF has assigned
$448.7 million worth of Special Drawing Rights (SDR) to Belarus
beyond the Stand-by Arrangement (SBA) lending program. The
intent is to boost Belarus foreign reserves during the global
financial crisis.
7. Issuance of WB loan Will Depend on Belarus' Compliance With
Its IMF SBA
The World Bank Resident Representative in Belarus, Ivan Velev,
told the journalists on September 11 that the WB Board of
Directors will consider a $200 million Development Policy Loan
(DPL) for Belarus in late autumn 2009. Should Belarus fall
short of the targets set in the IMF's Stand-by Arrangement
(SBA),"it would slow the DPL project," the official added.
8. WB and IFC Praise GOB for Reforming Economy But Make it Clear
"There is Still Room For Improvement"
Neil Gregory, Acting Director of the WB-IFC Indicators and
Analysis praised the GOB's steps to streamline business
conditions and encouraged the GOB to continue reforms. He added
that the GOB has committed to further progress in providing
access to loans, protecting investors, boosting foreign trade
and liberalizing its taxation policy. At the same event, the
International Finance Corporation's Representative in Belarus
Craig Bell noted that approximately 51% of small and medium
businesses in Belarus had not seen any improvements in
administrative procedures, 37% noted improvements, and 12%
described procedures as "more difficult."
9. GDP Registers First Decline Since 1995
The National Statistics Committee informed the media on
September 11 that Belarus' GDP through August was $30.8 billion,
which marked 0.5 percent decrease year-on-year, the first
decline registered since 1995. Last year the economy registered
a 10% GDP increase.
10. Finance Ministry Posted 1.3 Percent Budget Deficit Through
July
A source in the Finance Ministry told Prime-TASS news agency on
September 15 that the national budget deficit for the period of
January-July 2009 was at 1.3% of the GDP. The national budget
reflects spending and revenues of the central administration,
while the consolidated budget also includes local budgets.
Lukashenka signed a decree on May 28 adjusting the budget
parameters for 2009, increasing the foreign debt limit from $2
billion to $8 billion. He also approved a zero-deficit budget
for 2009, reducing revenues by almost $3 billion to $16.7
billion, and expenditures by $4 billion to $16 billion.
11. Vice Premier: Fewer, But More Efficient Business Inspections
According to media reports, Deputy PM Andrey Kobyakov stated
that the 2009 suspension of business inspections and temporary
changes in scheduling procedures have reduced the actual number
of inspections while increasing their efficiency. The tax
agencies cut their inspections by 44.5% and the State Control
Committee by 33.5%.
12. Lukashenka Streamlines Granting State Support to the Needy
According to the Presidential press service, Lukashenka approved
new procedures for granting state support to individuals in the
areas of social allowances and non-cash housing subsidies. The
change, to come in to effect on January 1, 2010, will streamline
and simplify regulations for filing applications and allocating
state support. It will also raise the minimum criterion of need
MINSK 00000322 003.2 OF 003
required for receiving aid.
13. Joint Military Exercise Starts in Belarus
The Zapad-2009 (West-2009) joint Russian-Belarusian military
exercise kicked off in Belarus September 18 to test both
countries' capabilities to ensure their Union State's security
and readiness to repel a possible military aggression. The
exercise will continue until September 29 and will involve
12,600 Russian, Belarusian and Kazakh servicemen.
--------------
Quote of the Week
--------------
14. Answering questions of journalists in Vilnius on September
16, Lukashenka referred to Europeans' negative attitude towards
Belarus' electoral code, process and elections, and offered:
"Pay money - $15 million. This is not big money for you.
Organize elections in Belarus and their results will be legally
binding to me."
PUTZ
SIPDIS
E.O. 12958: N/A
TAGS: PGOV PREL PHUM ECON BO
SUBJECT: BELARUS WEEKLY POL/ECON REPORT - SEPTEMBER 18, 2009
MINSK 00000322 001.2 OF 003
1. The following are brief items of interest compiled by
Embassy Minsk.
TABLE OF CONTENTS
Civil Society
--------------
- GOB, Lithuania Defer Agreement on Simplified Border Crossing
(para. 2)
- GOB Continues to Harass and Fine Opposition Activists (para. 3)
- Riot Police Disperse an Opposition Demonstration Yet Again
(para. 4)
Economy
--------------
- Customs Union to Fine-tune Distribution of Import Incomes
(para. 5)
- IMF Issued $448.7 Million Worth of SDR's to Belarus (para. 6)
- Issuance of WB loan Will Depend on Belarus' Compliance With
Its IMF SBA (para. 7)
- WB and IFC Praise GOB for Reforming Economy But Make it Clear
"There is Still Room For Improvement" (para. 8)
- Through-August GDP Down 0.5 Percent Year-On-Year (para. 9)
- Finance Ministry Posted 1.3 Percent Budget Deficit Through
July (para. 10)
- Vice Premier: Less Inspections, But They Are More Efficient
(para. 11)
- Lukashenka Streamlines Granting State Support to the Needy
(para. 12)
International Security
--------------
- Joint Military Exercise Starts in Belarus (para. 13)
Quote of the Week (para. 14)
--------------
--------------
Civil Society
--------------
2 GOB, Lithuania Defer Agreement on Simplified Border Crossing
Chiefs of the Belarus and Lithuania border agencies signed a
border agreement. The document outlines procedures for
maintenance of the shared border, movement of goods, economic
and other activities at the border zone and resolution of
incidents. According to the Lithuanian MFA spokesperson,
Lithuania and GOB did not endorse an agreement on visa-free
travel between the two countries within the 50-kilometer border
zone because the GOB ostensibly "requested additional time to
finalize internal procedures." (BelaPAN, Delfi.lt, September
16)
3. GOB Continues to Harass and Fine Opposition Activists
A Vitebsk district court fined on September 15 Sergey Kovalenko,
local Conservative Christian Party member, $375 for allegedly
displaying an opposition white-red-white flag. Police detained
and questioned Kovalenko and his associate Taras Surgan, a Young
Belarus activist, on September 14. In a separate incident on
September 14, a Minsk district court fined "European Belarus"
civil campaign activist Maksim Sergiyets $250 for participating
in a September 9 rally against the Russian-Belarusian military
exercises named Zapad-2009. In another case in Mozyr, civil
society activist Pavel Nozdrya was fined $37 for allegedly
violating military registration procedures. A local draft
office claimed that Nozdrya failed to timely notify them that he
had changed a place of his employment.
4. Riot Police Disperse an Opposition Demonstration Yet Again
Riot police dispersed yet another unauthorized opposition rally,
this one marking the 10th anniversary of high-profile
disappearance in downtown Minsk on September 16. EMBOFFs
observed that as in a similar incident on September 9, law
enforcement officers surrounded the protesters 10 minutes after
they had assembled at the site and shoved about 35 of them into
police buses. They also impeded journalists taking pictures of
the dispersal. All the protesters were reportedly released with
no charges after a three-hour detention; however, many of the
activists report being assaulted, harassed, threatened with
physical abuse, and forced to give fingerprints. In a separate
incident in Gomel, police detained 16 local activists on their
way to a rally venue on September 16. Ten were charged with
holding an unsanctioned demonstration and released three hours
later. They maintained that they would appeal their detention
to the prosecutor's office.
--------------
MINSK 00000322 002.2 OF 003
Economy
--------------
5. Customs Union to Fine-tune Distribution of Import Incomes
According to media reports, the Executive Secretary of the
Commission of the Belarus, Russia and Kazakhstan Customs Union
Sergei Glaziev stated on September 14 that import incomes of the
Union will be distributed based on macroeconomic criteria that
have yet to be identified. The three member-states will
reportedly work independently in their national currencies but
later funds will be deposited into a single account. Export
duties, however, will be contributed directly to the budget.
The Union expects to reach an agreement on a unified tariff by
November of this year with the goal of it taking effect on
January 1, 2010. The single Customs Code is expected to come
into effect on July 1, 2010. Customs law of the Union will
include both the Customs Code and decisions of the Commission.
6. IMF Issued $448.7 Million Worth of Special Drawing Rights to
Belarus
Natalya Kolyadina, IMF Resident Representative in Minsk, told
Prime-TASS news agency on September 11 that the IMF has assigned
$448.7 million worth of Special Drawing Rights (SDR) to Belarus
beyond the Stand-by Arrangement (SBA) lending program. The
intent is to boost Belarus foreign reserves during the global
financial crisis.
7. Issuance of WB loan Will Depend on Belarus' Compliance With
Its IMF SBA
The World Bank Resident Representative in Belarus, Ivan Velev,
told the journalists on September 11 that the WB Board of
Directors will consider a $200 million Development Policy Loan
(DPL) for Belarus in late autumn 2009. Should Belarus fall
short of the targets set in the IMF's Stand-by Arrangement
(SBA),"it would slow the DPL project," the official added.
8. WB and IFC Praise GOB for Reforming Economy But Make it Clear
"There is Still Room For Improvement"
Neil Gregory, Acting Director of the WB-IFC Indicators and
Analysis praised the GOB's steps to streamline business
conditions and encouraged the GOB to continue reforms. He added
that the GOB has committed to further progress in providing
access to loans, protecting investors, boosting foreign trade
and liberalizing its taxation policy. At the same event, the
International Finance Corporation's Representative in Belarus
Craig Bell noted that approximately 51% of small and medium
businesses in Belarus had not seen any improvements in
administrative procedures, 37% noted improvements, and 12%
described procedures as "more difficult."
9. GDP Registers First Decline Since 1995
The National Statistics Committee informed the media on
September 11 that Belarus' GDP through August was $30.8 billion,
which marked 0.5 percent decrease year-on-year, the first
decline registered since 1995. Last year the economy registered
a 10% GDP increase.
10. Finance Ministry Posted 1.3 Percent Budget Deficit Through
July
A source in the Finance Ministry told Prime-TASS news agency on
September 15 that the national budget deficit for the period of
January-July 2009 was at 1.3% of the GDP. The national budget
reflects spending and revenues of the central administration,
while the consolidated budget also includes local budgets.
Lukashenka signed a decree on May 28 adjusting the budget
parameters for 2009, increasing the foreign debt limit from $2
billion to $8 billion. He also approved a zero-deficit budget
for 2009, reducing revenues by almost $3 billion to $16.7
billion, and expenditures by $4 billion to $16 billion.
11. Vice Premier: Fewer, But More Efficient Business Inspections
According to media reports, Deputy PM Andrey Kobyakov stated
that the 2009 suspension of business inspections and temporary
changes in scheduling procedures have reduced the actual number
of inspections while increasing their efficiency. The tax
agencies cut their inspections by 44.5% and the State Control
Committee by 33.5%.
12. Lukashenka Streamlines Granting State Support to the Needy
According to the Presidential press service, Lukashenka approved
new procedures for granting state support to individuals in the
areas of social allowances and non-cash housing subsidies. The
change, to come in to effect on January 1, 2010, will streamline
and simplify regulations for filing applications and allocating
state support. It will also raise the minimum criterion of need
MINSK 00000322 003.2 OF 003
required for receiving aid.
13. Joint Military Exercise Starts in Belarus
The Zapad-2009 (West-2009) joint Russian-Belarusian military
exercise kicked off in Belarus September 18 to test both
countries' capabilities to ensure their Union State's security
and readiness to repel a possible military aggression. The
exercise will continue until September 29 and will involve
12,600 Russian, Belarusian and Kazakh servicemen.
--------------
Quote of the Week
--------------
14. Answering questions of journalists in Vilnius on September
16, Lukashenka referred to Europeans' negative attitude towards
Belarus' electoral code, process and elections, and offered:
"Pay money - $15 million. This is not big money for you.
Organize elections in Belarus and their results will be legally
binding to me."
PUTZ