Identifier
Created
Classification
Origin
09MINSK332
2009-09-25 12:15:00
UNCLASSIFIED
Embassy Minsk
Cable title:
BELARUS WEEKLY POL/ECON REPORT - SEPTEMBER 25, 2009
how-toVZCZCXRO4449 RR RUEHAG RUEHAST RUEHDA RUEHDBU RUEHDF RUEHFL RUEHIK RUEHKW RUEHLA RUEHLN RUEHLZ RUEHNP RUEHPOD RUEHROV RUEHSL RUEHSR RUEHVK RUEHYG DE RUEHSK #0332/01 2681215 ZNR UUUUU ZZH R 251215Z SEP 09 FM AMEMBASSY MINSK TO RUEHC/SECSTATE WASHDC 0494 INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE RUEHSK/AMEMBASSY MINSK 0501
UNCLAS SECTION 01 OF 03 MINSK 000332
SIPDIS
E.O. 12958: N/A
TAGS: PGOV PREL PHUM ECON BO
SUBJECT: BELARUS WEEKLY POL/ECON REPORT - SEPTEMBER 25, 2009
MINSK 00000332 001.2 OF 003
UNCLAS SECTION 01 OF 03 MINSK 000332
SIPDIS
E.O. 12958: N/A
TAGS: PGOV PREL PHUM ECON BO
SUBJECT: BELARUS WEEKLY POL/ECON REPORT - SEPTEMBER 25, 2009
MINSK 00000332 001.2 OF 003
1. The following are brief items of interest compiled by
Embassy Minsk.
TABLE OF CONTENTS
Civil Society
--------------
- New Life Church Still Facing Eviction, Receives Support from
Visiting DRL Officer (para. 2)
- "European Belarus" Activists Detained, Fined (para. 3)
- GOB Continues to Enforce Politically Motivated Military
Conscriptions (para. 4)
- GOB Drops Criminal Charges Against Volkovysk Activist Yuriy
Leonov (para. 5)
Domestic Economy
--------------
- Belarus' Through-July Commodity Trade Down 40 Percent
Year-on-Year (para. 6)
- Both Net and Gross Foreign Assets on Decline Though August
(para. 7)
- Widening Current-Account Deficit Increases External Risks and
Liquidity Pressure (para. 8)
- GOB Drafted Pessimistic and Optimistic Scenarios of Belarus'
Development in 2010 (para. 9)
- GOB Expects a Burst of Investment Activities Later This Year
(para. 10)
- More Liberalization Edicts in the Pipeline (para. 11)
- Average Salary in August $ 367.8 (para. 12)
International Security
--------------
- Joint Military Exercise Continues in Belarus (para. 13)
Quote of the Week (para. 14)
--------------
--------------
Civil Society
--------------
2. New Life Church Still Facing Eviction, Receives Support from
Visiting DRL Officer
On October 7, the Minsk City Economic Court will commence
hearings on an eviction lawsuit filed by local district housing
maintenance authorities against the community of the New Life
Church (NLC). In their five-year-long dispute with the
authorities, the parishioners continue to deny GOB officials
access to their premises and refuse to vacate their building due
to insufficient compensation offered to the NLC for building a
new temple and wide-spread bans to lease other facilities
available in Minsk for organizing their religious services. The
NLC has repeatedly dismissed as "illegal" all charges and
speculations that the community violated procedures for
reconstructing its church building and holding the land plot
despite the Minsk City authorities' plans to use it for the
construction of a school. The lawyer of the NLC, Sergey
Lukanin, told the judge that the community had approached the UN
Human Rights Committee for support on September 9 and requested
the judge to postpone the hearings until the community received
a response from the Committee. On a separate account, various
independent news agencies carried reports on State Department
DRL Officer Daniel Nadel's visit with the NLC on September 21
during his six-day stay in Belarus. Lukanin and NLC's senior
pastors briefed and updated Nadel on the current situation with
the NLC, and Nadel assured the church leaders that the USG will
closely monitor the NLC case until the GOB stopped their
harassment against the NLC and violating the community's rights
and religious freedoms.
3. "European Belarus" Activists Detained, Fined
A Minsk District Court fined on September 22 "European Belarus"
civil campaign activist Maksim Vinyarskiy $375 for his
participation in an unauthorized demonstration. Police
dispersed a protest staged by ten campaign members in central
Minsk on September 21 to show solidarity with imprisoned
Volkovysk activists Nikolay Avtukhovich and Vladimir Osipenko
and Malady Front activist Artyom Dubskiy. Vinyarskiy, detained
overnight, was apprehended along with his associate Evgeniy
Afnagel who was released with no charges.
4. GOB Continues to Enforce Politically Motivated Military
Conscriptions
Two Malady Front activists, Gomel-based Andrey Tenyuta and
Brest-based Evgeniy Skrebets, were summoned for military
enlistment on September 25 and September 21, respectively. Both
have condemned their forced army conscription as "illegal" and
"politically motivated." Tenyuta's recruitment had been
MINSK 00000332 002.2 OF 003
deferred for the period of his studies; however, he was expelled
from a school in Russia in June 2009. The activists were
enlisted despite being earlier declared "unfit" for army
services due to some severe health conditions, including
scoliosis. Tenyuta will be serving in a transport troop unit in
the Gomel Region, and Skrebets was drafted to a railroad army
detachment near Mogilyov.
5. GOB Drops Criminal Charges Against Volkovysk Activist Yuriy
Leonov
On September 24, Volkovysk activist Yuriy Leonov, who was
released from pretrial holding facilities on August 8, received
official notification that the Interior Ministry closed the
criminal case against him on charges of deliberate destruction
or damage of property and arson. Leonov argued that the GOB
thereby admitted that the charges were "groundless," absurd, and
far-fetched and called for open court hearings against his
jailed associates Nikolay Avtukhovich and Vladimir Osipenko. In
addition, Avtukhovich is facing terrorism charges. The
investigation into that is reportedly ongoing, and no date for
court hearings has been yet announced.
--------------
Economy
--------------
6. Belarus' Through-July Commodity Trade Down 40 Percent
Year-on-Year
According to the data of the state news agency Belta aired on
September 22, Belarus' commodity trade reached $26.33 billion in
January-July 2009 or 60 percent of the trade in the same period
for 2008. Belarus' exports amounted to $11.022 billion or 53.9
percent and imports - to $15.308 billion or 65.1 percent,
respectively, and the trade deficit continues to grow.
7. Both Net and Gross Foreign Assets on Decline Though August
A source in the National Bank (NB) told Prime-TASS news agency
September 21 that, according to the preliminary data, as of
September 1, the NB and the GOB's net foreign assets totaled
$2.87 billion, which is 10.2% less than this past January.
Gross foreign assets dropped through August 9.1% down to $3.3
billion.
8. Widening Current-Account Deficit Increases External Risks and
Liquidity Pressure
According to data of the IHS Global Insight organization posted
on September 22, the Belarus National Bank's (NB) report on
balance of payments showed continued rapid widening of the
Belarusian current-account deficit. In Q2 of 2009, the
shortfall deepened by 89% year-on-year; however, the pace of the
widening moderated from the Q1 when the deficit had nearly
quadrupled, and quarter-on-quarter development demonstrated a
narrowing of 5%. Despite the latter, the current account
deficit of approximately $3.7 billion, or 18% of the GDP in the
first half of 2009 (vs. $1.4 billion in the first half of 2008)
poses a major source of external risk and considerable liquidity
pressures for Belarus. In Q2 2009, foreign direct investment
inflow covered only 10% of the current account deficit compared
to almost 50% in Q1 and nearly 30% in Q2 of 2008.
9. GOB Drafted Pessimistic and Optimistic Scenarios of Belarus'
Development in 2010
According to the GOB press service, answering questions of
reporters on September 23, PM Syarhey Sidorski explained that
the GOB has elaborated a draft of the socioeconomic development
forecast for 2010 based on two scenarios. First the "Balanced"
scenario provides for a 2-3 percent growth year-on-year, and the
second, "Optimistic", envisages a 10-11 percent projected
growth. He expressed GOB's hopes for Belarus expanding its
exports amidst optimistic reports from Russia, Belarus' major
export market, and the U.S. that the global recession is over as
well as growing demand for Belarus-made products in such new
markets as African and Asian countries.
10. GOB Expects a Burst of Investment Activities Later This Year
According to media reports, Director of Belarus' National
Investment Agency, Viktor Kovalenko, told reporters September 18
that the GOB expects a burst of activity of foreign investors in
Belarus later this year. At the moment, the situation is very
quiet as everybody is waiting for Lukashenka's decrees and
edicts, giving more benefits to investors, to come into effect.
Currently, the GOB is allegedly negotiating large investments
with five foreign financial groups, which plan to invest in
Belarus. Mr. Kovalenko also announced that Minsk will host a
Belarusian Investment Forum, November 12-13.
11. More Liberalization Edicts in the Pipeline
MINSK 00000332 003.2 OF 003
A representative of the Ministry of Economy told reporters
September 22 that six presidential edicts, when signed, would
reduce customs formalities and tax burden on small businesses.
Also there would be weekly discussions to identify ways to
support small businesses which sell Belarusian-made products
inside and outside the country. The goal is to increase the
small businesses' share of such sales from its current 1-3
percent of the market to 30-40 percent by the end of the year.
12. Average Salary in August $ 367.8
The National Statistics Committee announced September 23 that
the average before-tax monthly salary in Belarus reached about
$350 in January-August 2009, up 0.8% to $367.8 alone in August.
Workers in the construction sector were reportedly receiving the
highest salaries.
--------------
International Security
--------------
13. Joint Military Exercise Continues in Belarus
The Zapad-2009 (West-2009) joint Russian-Belarusian military
exercise, which started in Belarus September 18, entered its
final stage September 23 and will last until September 29.
According to the simulated scenario, a conflict broke out in
Belarus and Russia came to its ally's help. The troops involved
will practice repelling AIR strikes and will streamline the
management of military units. The exercise will be supported by
Belarus' Interior, Emergency Situations, Health, and Transport
ministries, KGB and the State Border Committee. The
Obuz-Lesnovski training ground in the Brest region is the main
venue of the exercise, the active stage which will take place on
September 29. A separate exercise will take place at a training
ground near the city of Borisov, Minsk region, September 27 and
28. Its scenario has been drawn up by the Russian Armed Forces'
General Staff and is not connected with Zapad-2009.
--------------
Quote of the Week
--------------
14. Speaking at the "Dazhinky" festival in the city of Kobryn
(Brest region) September 19, Lukashenka
said:
"the level of budget expenditures on social needs that we had
this year - more than 60 percent - we will definitely preserve
in order to support people in this difficult time."
MILLER
SIPDIS
E.O. 12958: N/A
TAGS: PGOV PREL PHUM ECON BO
SUBJECT: BELARUS WEEKLY POL/ECON REPORT - SEPTEMBER 25, 2009
MINSK 00000332 001.2 OF 003
1. The following are brief items of interest compiled by
Embassy Minsk.
TABLE OF CONTENTS
Civil Society
--------------
- New Life Church Still Facing Eviction, Receives Support from
Visiting DRL Officer (para. 2)
- "European Belarus" Activists Detained, Fined (para. 3)
- GOB Continues to Enforce Politically Motivated Military
Conscriptions (para. 4)
- GOB Drops Criminal Charges Against Volkovysk Activist Yuriy
Leonov (para. 5)
Domestic Economy
--------------
- Belarus' Through-July Commodity Trade Down 40 Percent
Year-on-Year (para. 6)
- Both Net and Gross Foreign Assets on Decline Though August
(para. 7)
- Widening Current-Account Deficit Increases External Risks and
Liquidity Pressure (para. 8)
- GOB Drafted Pessimistic and Optimistic Scenarios of Belarus'
Development in 2010 (para. 9)
- GOB Expects a Burst of Investment Activities Later This Year
(para. 10)
- More Liberalization Edicts in the Pipeline (para. 11)
- Average Salary in August $ 367.8 (para. 12)
International Security
--------------
- Joint Military Exercise Continues in Belarus (para. 13)
Quote of the Week (para. 14)
--------------
--------------
Civil Society
--------------
2. New Life Church Still Facing Eviction, Receives Support from
Visiting DRL Officer
On October 7, the Minsk City Economic Court will commence
hearings on an eviction lawsuit filed by local district housing
maintenance authorities against the community of the New Life
Church (NLC). In their five-year-long dispute with the
authorities, the parishioners continue to deny GOB officials
access to their premises and refuse to vacate their building due
to insufficient compensation offered to the NLC for building a
new temple and wide-spread bans to lease other facilities
available in Minsk for organizing their religious services. The
NLC has repeatedly dismissed as "illegal" all charges and
speculations that the community violated procedures for
reconstructing its church building and holding the land plot
despite the Minsk City authorities' plans to use it for the
construction of a school. The lawyer of the NLC, Sergey
Lukanin, told the judge that the community had approached the UN
Human Rights Committee for support on September 9 and requested
the judge to postpone the hearings until the community received
a response from the Committee. On a separate account, various
independent news agencies carried reports on State Department
DRL Officer Daniel Nadel's visit with the NLC on September 21
during his six-day stay in Belarus. Lukanin and NLC's senior
pastors briefed and updated Nadel on the current situation with
the NLC, and Nadel assured the church leaders that the USG will
closely monitor the NLC case until the GOB stopped their
harassment against the NLC and violating the community's rights
and religious freedoms.
3. "European Belarus" Activists Detained, Fined
A Minsk District Court fined on September 22 "European Belarus"
civil campaign activist Maksim Vinyarskiy $375 for his
participation in an unauthorized demonstration. Police
dispersed a protest staged by ten campaign members in central
Minsk on September 21 to show solidarity with imprisoned
Volkovysk activists Nikolay Avtukhovich and Vladimir Osipenko
and Malady Front activist Artyom Dubskiy. Vinyarskiy, detained
overnight, was apprehended along with his associate Evgeniy
Afnagel who was released with no charges.
4. GOB Continues to Enforce Politically Motivated Military
Conscriptions
Two Malady Front activists, Gomel-based Andrey Tenyuta and
Brest-based Evgeniy Skrebets, were summoned for military
enlistment on September 25 and September 21, respectively. Both
have condemned their forced army conscription as "illegal" and
"politically motivated." Tenyuta's recruitment had been
MINSK 00000332 002.2 OF 003
deferred for the period of his studies; however, he was expelled
from a school in Russia in June 2009. The activists were
enlisted despite being earlier declared "unfit" for army
services due to some severe health conditions, including
scoliosis. Tenyuta will be serving in a transport troop unit in
the Gomel Region, and Skrebets was drafted to a railroad army
detachment near Mogilyov.
5. GOB Drops Criminal Charges Against Volkovysk Activist Yuriy
Leonov
On September 24, Volkovysk activist Yuriy Leonov, who was
released from pretrial holding facilities on August 8, received
official notification that the Interior Ministry closed the
criminal case against him on charges of deliberate destruction
or damage of property and arson. Leonov argued that the GOB
thereby admitted that the charges were "groundless," absurd, and
far-fetched and called for open court hearings against his
jailed associates Nikolay Avtukhovich and Vladimir Osipenko. In
addition, Avtukhovich is facing terrorism charges. The
investigation into that is reportedly ongoing, and no date for
court hearings has been yet announced.
--------------
Economy
--------------
6. Belarus' Through-July Commodity Trade Down 40 Percent
Year-on-Year
According to the data of the state news agency Belta aired on
September 22, Belarus' commodity trade reached $26.33 billion in
January-July 2009 or 60 percent of the trade in the same period
for 2008. Belarus' exports amounted to $11.022 billion or 53.9
percent and imports - to $15.308 billion or 65.1 percent,
respectively, and the trade deficit continues to grow.
7. Both Net and Gross Foreign Assets on Decline Though August
A source in the National Bank (NB) told Prime-TASS news agency
September 21 that, according to the preliminary data, as of
September 1, the NB and the GOB's net foreign assets totaled
$2.87 billion, which is 10.2% less than this past January.
Gross foreign assets dropped through August 9.1% down to $3.3
billion.
8. Widening Current-Account Deficit Increases External Risks and
Liquidity Pressure
According to data of the IHS Global Insight organization posted
on September 22, the Belarus National Bank's (NB) report on
balance of payments showed continued rapid widening of the
Belarusian current-account deficit. In Q2 of 2009, the
shortfall deepened by 89% year-on-year; however, the pace of the
widening moderated from the Q1 when the deficit had nearly
quadrupled, and quarter-on-quarter development demonstrated a
narrowing of 5%. Despite the latter, the current account
deficit of approximately $3.7 billion, or 18% of the GDP in the
first half of 2009 (vs. $1.4 billion in the first half of 2008)
poses a major source of external risk and considerable liquidity
pressures for Belarus. In Q2 2009, foreign direct investment
inflow covered only 10% of the current account deficit compared
to almost 50% in Q1 and nearly 30% in Q2 of 2008.
9. GOB Drafted Pessimistic and Optimistic Scenarios of Belarus'
Development in 2010
According to the GOB press service, answering questions of
reporters on September 23, PM Syarhey Sidorski explained that
the GOB has elaborated a draft of the socioeconomic development
forecast for 2010 based on two scenarios. First the "Balanced"
scenario provides for a 2-3 percent growth year-on-year, and the
second, "Optimistic", envisages a 10-11 percent projected
growth. He expressed GOB's hopes for Belarus expanding its
exports amidst optimistic reports from Russia, Belarus' major
export market, and the U.S. that the global recession is over as
well as growing demand for Belarus-made products in such new
markets as African and Asian countries.
10. GOB Expects a Burst of Investment Activities Later This Year
According to media reports, Director of Belarus' National
Investment Agency, Viktor Kovalenko, told reporters September 18
that the GOB expects a burst of activity of foreign investors in
Belarus later this year. At the moment, the situation is very
quiet as everybody is waiting for Lukashenka's decrees and
edicts, giving more benefits to investors, to come into effect.
Currently, the GOB is allegedly negotiating large investments
with five foreign financial groups, which plan to invest in
Belarus. Mr. Kovalenko also announced that Minsk will host a
Belarusian Investment Forum, November 12-13.
11. More Liberalization Edicts in the Pipeline
MINSK 00000332 003.2 OF 003
A representative of the Ministry of Economy told reporters
September 22 that six presidential edicts, when signed, would
reduce customs formalities and tax burden on small businesses.
Also there would be weekly discussions to identify ways to
support small businesses which sell Belarusian-made products
inside and outside the country. The goal is to increase the
small businesses' share of such sales from its current 1-3
percent of the market to 30-40 percent by the end of the year.
12. Average Salary in August $ 367.8
The National Statistics Committee announced September 23 that
the average before-tax monthly salary in Belarus reached about
$350 in January-August 2009, up 0.8% to $367.8 alone in August.
Workers in the construction sector were reportedly receiving the
highest salaries.
--------------
International Security
--------------
13. Joint Military Exercise Continues in Belarus
The Zapad-2009 (West-2009) joint Russian-Belarusian military
exercise, which started in Belarus September 18, entered its
final stage September 23 and will last until September 29.
According to the simulated scenario, a conflict broke out in
Belarus and Russia came to its ally's help. The troops involved
will practice repelling AIR strikes and will streamline the
management of military units. The exercise will be supported by
Belarus' Interior, Emergency Situations, Health, and Transport
ministries, KGB and the State Border Committee. The
Obuz-Lesnovski training ground in the Brest region is the main
venue of the exercise, the active stage which will take place on
September 29. A separate exercise will take place at a training
ground near the city of Borisov, Minsk region, September 27 and
28. Its scenario has been drawn up by the Russian Armed Forces'
General Staff and is not connected with Zapad-2009.
--------------
Quote of the Week
--------------
14. Speaking at the "Dazhinky" festival in the city of Kobryn
(Brest region) September 19, Lukashenka
said:
"the level of budget expenditures on social needs that we had
this year - more than 60 percent - we will definitely preserve
in order to support people in this difficult time."
MILLER