VZCZCXRO8459
RR RUEHIK
DE RUEHSK #0359/01 2961600
ZNR UUUUU ZZH
R 231600Z OCT 09
FM AMEMBASSY MINSK
INFO RUEHC/SECSTATE WASHDC 0527
RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUEHVEN/USMISSION USOSCE 0003
RUEHSK/AMEMBASSY MINSK 0535

UNCLAS SECTION 01 OF 02 MINSK 000359 
 
SENSITIVE 
SIPDIS 
 
DEPT FOR EUR/UMB (JOE WANG) 
 
E.O. 12958: N/A 
TAGS: PGOV PHUM ECON BO
SUBJECT: MID SIZE CITY IN BELARUS:  ACTIVIST MORE CONFIDENT BUT 
PRIVATE BUSINESS LESS 
 
MINSK 00000359  001.3 OF 002 
 
 
¶1.  (U) Summary:  On August 5, 2009 Chargi Scanlan visited 
Borisov, the second largest industrial center (pop 150,000) in 
the Minsk Oblast, where he met with the local authorities, state 
and private businesses, opposition political parties and civil 
society. While the authorities praised improvements in the 
business climate and civil freedoms, democratic activists and 
entrepreneurs expressed skepticism and stated that government 
pressure continued but in a more subtle way.  For activist, 
however, that meant more space, but for entrepreneurs it was 
resulting in a decrease in profitability. End Summary. 
 
 Harassment Continues But More Subtle But That Creates Space 
--------------------------------------------- --------------- 
 
¶2. (U) Members of political parties and civil society 
organizations in Borisov told the Chargi that the GOB's pressure 
has become more subtle. Detentions have been replaced by fines 
and harassment, such as threats not to prolong work contracts. 
This pressure forces activists and their relatives employed by 
state enterprises to work "underground" in order not to lose 
their jobs. They also mentioned that it was more difficult to 
operate in the regions than in Minsk. People are banned not only 
from organizing events in Borisov but also from attending events 
in Minsk. At the same, time democratic community representatives 
noted that this subtle pressure was not as disruptive as the 
previous overt harassment or detention had been, thus it was now 
easier to reach out to the public with their message.  They also 
feel more confident in their effort to register their parties 
and organizations because the government feels increasingly 
compelled to work through a "legal" framework. 
 
 Officials: Private Sector Booming; Opposition: It's a Mirage 
--------------------------------------------- ---------------- 
 
¶3. (U) The Mayor of Borisov reported on the favorable climate 
for small private businesses in the region noting quick 
registration and simplified tax policies. As an example, Borisov 
Executive Committee officials cited a successful entrepreneur 
running a market and the growing number of small businesses that 
have registered despite the crisis. The Mayor also expressed 
interest in attracting American businesses to the region, to 
which the Chargi responded that the latter prefer to work with 
private sector and in free market conditions, and are 
independent from the USG in their decisions. Consequently, CDA 
advised the Mayor to do everything possible to promote the 
expansion of the private sector in his city. 
 
¶4. (U) Independent entrepreneurs, however, expressed skepticism 
concerning the official economic statistics, which show 
sky-rocketing number of small businesses.  Such skepticism is 
reinforced by official decrees like Decree 760 that limits 
private entrepreneurs to employing family members only, which 
forces private entrepreneurs to restructure their businesses by 
subdividing them into a number of smaller businesses thus 
creating an artificial increase the number of individual 
entrepreneurs. Another superficial increase in the number of 
entrepreneurs occurred when state factories due to the financial 
crisis put workers on part time schedules which then forced 
workers to register as private entrepreneurs, as a safety 
measure to a possible future unemployment.  GOB's policy of full 
employment means that in Belarus there is really no unemployment 
safety net to speak off.  As workers pointed out to Charge the 
most they could count on if laid off was $17 a month in 
unemployment benefits. 
 
¶5. (U) Private entrepreneurs also told the Chargi that 
businesses operations had become more difficult because of the 
crisis and harsh regulations. The ban on selling beer and light 
alcoholic drinks in kiosks, and rental payments tied to the EURO 
had put many entrepreneurs out of business. To combat this trend 
the entrepreneurs started a legal support group that provides 
assistance in defending their rights. This group also 
distributes information to various groups in order to capitalize 
on the growing discontent among workers, especially those that 
have experienced shortened work schedules and reduced salaries. 
 
Independent Media Scraping Through But Demand Growing 
--------------------------------------------- -------- 
 
¶6. (SBU) According to Anatoly Bukas, Chief Editor of an 
independent newspaper "Borisovskiye Novosti" [Borisov News, 
circulation 7,000], there are twelve independent regional 
newspapers around the country that have been banned from state 
subscription and distribution networks. Only "Bobruisky Courier" 
(circulation 2,600) is allowed into the state distribution 
system. The other twelve continue to operate, though at a 
disadvantage to state newspapers as they are forced to pay 
higher-priced commercial postage rates plus didn't have access 
 
MINSK 00000359  002.3 OF 002 
 
 
newspaper kiosks so they must find other platforms to sell their 
papers from.  At the same time, Bukas noted that the economic 
crisis is making people search for answers and thus other 
sources of information than the state media, thus increasing the 
demand for independent newspapers. 
 
Comment 
------- 
 
¶7. (SBU) As part of Lukashenka's efforts to appease Western 
audiences? Local authorities are clearly feeling increasingly 
obliged to keep their pressure against democratic activists more 
subtle. This, however, has had unforeseen consequences for the 
authorities as it has given political parties, civil society and 
independent media more opportunities to reach out to people 
making them more confident.  Small businesses however exist in 
much harsher conditions now and only those that have protection 
from the authorities manage to profit and expand. While, the 
authorities in Borisov seem to realize the need to improve the 
business climate and attract investors, they are not willing to 
alter the existing system maintaining that it has already been 
sufficiently changed. End Comment. 
SCANLAN