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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