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Today's Headlines for:
Wednesday, July 23, 2008

Belarus adopts privatisation plan, Elections, Food crisis, Retail chains, Chavez visits, Moscow, Ukraine, Polish scandal, Economy, Culture and Sport

  • From the Top...
  • #327

    Belarus adopts privatisation plan for 2008-2010

    From: BelTA and the Office of the President
    Alexander Lukashenko decorating the captain of the Olympic team of Belarus, Ivan Tikhon, with the Order of Fatherland, 2nd class
    The Belarusian government has adopted a privatisation plan for 2008-2010. The decision is laid down by Council of Ministers resolution No 1021.

    The privatisation plan is divided into two parts. The first one lists 519 national enterprises, both small and large ones, which are supposed to be incorporated as joint-stock companies within the next three years. The second part lists 147 open joint-stock companies, which shares will be sold in line with decree No 7.

    The resolution comes into force on the official publication date.

    Decree No 7 of April 14, 2008 gradually lifts restrictions from the circulation of shares of Belarusian open joint-stock companies, which were created through privatisation and denationalization. Earlier alienation of these shares was forbidden.

    During the first phase (starting July 17, 2008) the restriction on alienating shares of joint-stock companies, in which authorised funds the government share is zero or equals 75% and more, is lifted. The ban on alienating shares of joint-stock companies, which specialise in processing agricultural products, and shares of cereal product companies is fully lifted.

    During the second phase (starting January 1, 2009) restrictions on alienating shares of joint-stock companies with the state share over 50% will be lifted.

    During the first and second phase restrictions will stay in place for shares of joint-stock companies, which ensure the operation of strategic industries of the national economy.

    During the third phase (starting January 1, 2011) all restrictions will be lifted.

    Shares of open joint-stock companies, which are created through denationalisation and privatisation, will be sold at tenders and auctions.

    The decree is meant to improve legal instruments, which regulate the privatisation of state property, to protect rights and legal interests of citizens. The document provides for working out a three-year plan for privatising national property objects. In line with the decree a list of national unitary enterprises, which are supposed to be privatised into open joint-stock companies, as well as a list of open joint-stock companies, in which government-owned shares are supposed to be sold, is supposed to be prepared.

    519 companies to be privatized in Belarus within 3 years

    In 2008-2010, 519 enterprises are to be privatized in Belarus. The privatization plan was confirmed by Decree No 1021 of the Council of Ministers.

    The Minsk Motor Works (MMZ trademark), Optoelectronic Systems, Minskagroprommash, Minsk Mechanical Plant named after Sergei Vavilov, Belgaztekhnika scientific-industriai enterprise, Gomeltextiletorg are to become privately owned in 2008.

    In 2009, another group of enterprises are to be privatized. Among them are Gomel Plant of Agricultural Machinery, Gomselmash, Belarusian Automobile Plant, Minsk Plant of Wheeled Carriers, Vityaz, Agat-System, Inkotekh, Belgosproyekt institute, Electronica, Gomeltransneft Druzhba.

    In 2010, Minsk Automated Lines Plant named after Piotr Masherov, Minsk Scientific and Research Institute of Radio Materials, Orsha Flax Scutching Mill and some others are to be privatized, too.

    State will hold Belarusbank, Belagroprombank controlling stake in the future, Piotr Prokopovich says

    The state will own the controlling stake of Belarusbank and Belagroprombank in the near future, BelTA learnt from Chairman of the Board of Directors of the National Bank of Belarus Piotr Prokopovich.

    “As for the sales of the shares of the Belarusian banks to foreign investors, it is a permanent process. Commercial banks themselves determine the necessity to transfer their equity stake to investors. The country is working towards attracting strategic investors that are in the leading list in the world banking area. Therefore, we do not hurry and choose those investors that can considerably contribute to the development of the Belarusian banking system,” the Chairman of the National Bank said.

    Paritetbank of Belarus is almost completing the process of attracting a foreign investor, Piotr Prokopovich added.

  • Other Belarusian News...

    Registration of initiative groups in top gear

    From: BelTA
    The political parties are actively involved in registering initiative groups for nominating candidates, BelTA learnt from secretary of the central election commission Nikolai Lozovik.

    The nomination of candidates through signatures collection is one of the three ways to participate in the parliamentary elections. One can also run for the Lower Chamber of the Belarusian Parliament if one is nominated by their co-workers or a political party. The signatures (a total of 1000) are collected by an initiative group consisting of at least 10 people.

    The deadline for submitting the lists of initiative groups and the applications for their registration is July 24. The nomination of candidates to the House of Representatives of the fourth convocation was launched on July 20.

    “Political parties seem to nominate the same candidates through different ways – by a political party, at a congress and by collecting signatures,” Nikolai Lozovik said. According to him, they do it “to get an opportunity to meet with voters, introduce them to their programmes before they are registered as candidates.” Nikolai Lozovik also noted that a potential candidate can also act as member of an initiative group, lead it and collect signatures in his/her support.

    The secretary of the central election commission underlined that the Belarusian legislature gives candidates an opportunity to use “double” or “triple” nomination simultaneously: by a political party, co-workers and by collecting signatures.

    Belarus calls for removing food crisis-aiding trade barriers

    From: BelTA
    Belarus calls upon other countries to stop activities, which contribute to the spread of the food crisis, by removing export subsidies and other barriers in the trade in agricultural products, by ceasing speculative transactions on the food market. The position was voiced by the Belarusian delegation at a plenary session of the UN General Assembly, which was dedicated to the global food and energy crisis. The information was released by the Belarusian Ministry of Foreign Affairs.

    According to the Belarusian side, the UN system and developed nations should be the engine to fight the existing global crises. The shortage of food and energy in the XXI century testifies to the fact that it is time for the mankind to think about changing its approaches to lifestyle, nature, interests of other countries, consumption policy. The registered phenomena indicate that a system crisis is ripe in some parts of the world. Without proper response actions it can grow into a global crisis, delivering a devastating blow to the sustainable development, breaking the world’s social and political security.

    The Belarusian delegation underscored, the food crisis does not threaten Belarus, as the country continues increasing the output of agricultural products, with the domestic demand for food fully satisfied.

    “Meanwhile, the Republic of Belarus cannot overlook problems and disasters of other countries and regions and hence is insistent in calling upon governments of donor states and private business to increase support for aid programmes extended to developing nations via the Food and Agricultural Organization and the World Food Program”. The Belarusian delegation also urged to stop activities, which aid the spread of the food crisis. Belarus urged to remove export subsidies and other barriers in the trade in agricultural products, and to cease speculative transactions on the food market.

    As far as the energy crisis is concerned, the crisis was attributed to various factors such as the artificial build-up of tensions around the regions that produce energy resources and multiple barriers on the way to introducing new pure and stable energy technologies.

    The Belarusian delegation named the successful introduction of contemporary energy technologies the necessary requirement for achieving virtually all Millennium Goals from liquidating poverty to ensuring total education. In view of the fact Belarus suggests discussing working out mechanisms for utilising the technologies on the global scale taking into account interests of all nations and without breaking intellectual property rights during special debates of the General Assembly.

    As measures to fight the global food and energy crises are developed, apart from satisfying needs and requirements of low-income nations, it is necessary to take into account interests of medium-income countries such as Belarus.

  • Economics...

    IFC, A1 to extend $6mn loan to develop food retail chain in Belarus

    From: BelTA
    The International Finance Corporation (IFC) and A1, a subdivision of Russia’s biggest Alfa-Group consortium, signed an agreement to finance the project on development of the Belmarket food chain, reads an IFC press release.

    The IFC will provide a $6 million loan facility to finance the launch of 128 stores. Belmarket, the first large retailer in Belarus, will increase competition in the local retail sector and improve operational efficiencies. It will also expand access to modern retail services by offering quality products at fair prices.

    According to Alexander Babikov, Belmarket’s Chairman of the Board, cooperation with the IFC substantially increases Belmarket’s prospects in the market. The IFC has already provided financing for the A1 projects: Vladpivo in Russia and Syabar in Belarus, and both projects were successful. “The IFC’s participation provides us the first class investment and financial expertise,” Alexander Babikov said.

    “The IFC is pleased to support this project due to its major development impact, which includes the increase in competition in the retail sector and promotion of sustainable private sector development. In addition, this project will open new channels for small and medium producers in the country to sell their goods to reliable buyers. The project is also expected to generate many direct and indirect jobs,” said Nena Stojiljkovic, the IFC Director for Central and Eastern Europe.

    The International Finance Corporation (IFC) was set up in 1956 as the private sector arm of the World Bank Group. The IFC is the world’s largest multilateral financier for companies that do business in emerging economies. The IFC unites 178 countries.

    In 2007, the IFC committed $8.2 billion and mobilized an additional $3.9 billion through syndications and structured finance for 299 investments in 69 developing countries. The IFC also provided advisory services in 97 countries.

    A1 is a leading direct investment company in Russia and the CIS. A1 invests in various industries to benefit its shareholders, clients and partners.

    Belneftekhim sale prices 5% up

    Sale prices for oil products, petrol for thermal decomposition and aromatic hydrocarbons increased in Belarus on July 18, Belneftekhim Concern informed.

    Sale prices for oil products went up on average by 5%. The price (without VAT) for 1 tonne of A-76 petrol totaled Br1,990,000. The sale price for one tonne of AI-92 petrol reached Br2,487,960, AI-95 – Br2,848,020, diesel – Br1,757,450.

    Retail prices are expected to up as well.

    Belneftekhim has raised retail prices for oil products twice this year. On June 10, retail prices for petrol went up by 5% and for diesel – by 14.8%. On July 6, the price grew 5% and 9.8% respectively. An increase has been driven by growing prices for oil and necessity to secure the attractiveness of the company’s activity at the domestic market.

    Four new resident companies register with High-Tech Park of Belarus

    Four new resident companies and one business-project have been registered in the High-Tech Park of Belarus, BelTA was told in the administration of the Park.

    A decision to register new companies was taken by the Supervisory Board of the High-Tech Park. The new resident companies are the Pi-consult by, Altoros Development, Synthesis and Tochnyie Reshenia companies.

    One business-project in new and high technology that has been registered in the Park is pursued by the research production SKB Kamerton company. It embraces design and introduction of an operational management system of response forces and means of the security department of the Interior Ministry of Belarus to ensure security of citizens and transport vehicles.

    The High-Tech Park intends to create favourable conditions for increasing competitiveness of the branches of the Belarusian economy based on new and high technology. As of January 1, 2008 there were 38 resident companies. Four business projects are underway. Twenty companies are Belarusian, 18 are foreign. Last year 22 legal entities and one individual entrepreneur registered with the Park.

    President of Venezuela expected to visit Belarus this week

    From: BelTA
    President of the Bolivarian Republic of Venezuela Hugo Chavez is expected to visit Belarus this week, BelTA has been told in the embassy of Venezuela in Belarus.

    The diplomatic mission has said that the exact date of the visit and the programme are not known yet.

    Hugo Chavez has been to Belarus twice in 2006 and in 2007. In December 2007 President of Belarus Alexander Lukashenko made an official visit to Venezuela during which the sides signed a range of important documents and inaugurated the joint Belarusian-Venezuelan oil production company.

  • From the International Press...

    Chavez heads for Belarus to meet with his "friend" Lukashenko

    From: El Unuversal
    President Hugo Chavez is paying a working visit on Wednesday to Belarus, the second stopover in his European tour, where he is going to meet with Belarusian leader Alexandr Lukashenko.

    Chavez and Lukashenko, who already met in Caracas last December, are to address economic and energy cooperation issues, according to official news agency Belta, reported Efe.

    Specifically, Caracas wants Belarus to start producing agriculture machinery in Venezuela in the near future, especially its worldwide renowned tractors.

    During Chavez's visit a number of bilateral agreements are expected to be initialed, added Belta.

    This will be the third meeting between both rulers in the last two years. In the past, they have strongly criticized the US diplomatic pressure. Washington sees both governments as "strongholds of tyranny."

    Chavez arrives in Moscow to buy arms

    In a related story, Venezuelan President Hugo Chavez is signing arms and energy deals during a visit to Moscow that started on Tuesday, in a move likely to further strain the ties between Russia and the United States.

    Chavez will use his meetings with Russian President Dmitry Medvedev and Prime Minister Vladimir Putin to enhance his image as a leading critic of the United States, which views the Venezuelan ruler as a fierce opponent.

    "I have great hopes we will be able to continue building our strategic alliance," Chavez said to a group of reporters after landing in Moscow. "The deals will guarantee the sovereignty of Venezuela which is being threatened by the United States," Ch?vez added.

    "This is my first visit to President Medvedev," Chavez said. "We are acquainted because very wise, personal diplomatic efforts are under way," he added.

    The US does not criticize Venezuela's purchase of Russian weapons

    The US Department of State on Monday refrained from criticizing the purchase of Russian weapons by Venezuela, a new sign of the appeasement policy of Washington towards Caracas.

    So far, the US Government has made it clear that Washington does not approve Venezuelan President Hugo Ch?vez's massive weapon purchases. However, the US Department of State's spokesperson Gonzalo Gallegos was very cautious, reported DPA.

    "Venezuelans want to have a significant number of arms to carry out the security functions they need," stated Gallegos.

    "We are not here to tell them what they should or should not do. But I think it is clear that Hugo Ch?vez has a government to lead", he added.

    Belarus applies to UN global fund for €25 million

    From: Naveny
    The Belarusian government is seeking to obtain €25 million in donor funds to finance its 2010-2014 program aimed at the prevention of HIV, Eleanora Hvazdzyova, a coordinator of the Joint United Nations Program on HIV/AIDS, told reporters in Minsk on Monday, BelaPAN said.

    The government applied for the sum to the Global Fund to Fight AIDS, Tuberculosis and Malaria.

    Ms. Hvazdzyova said that the sum accounted for 39.2 percent of the country's demand for such funds.

    She said that the amount of donor assistance to Belarus' effort to fight HIV was increasing, amounting to $10 million in 2006 and 2007.

    "Expenditures on the prevention of HIV/AIDS are growing because of virus trends, its increasing spread through sexual intercourse," she said.

    Ms. Hvazdzyova called for a greater effort to raise the Belarusian population's awareness of HIV.

    She said that the number of people in need of expensive antiretroviral treatment was projected to increase fourfold by 2014, noting that 4,000 people were expected to receive it.

    A total of 9,194 people were diagnosed with HIV in Belarus as of July 1, with 457 accounting for cases diagnosed in the first six months of this year.

    Heineken spends $11 million on modernization of Babruysk-based Syabar

    From: Naveny
    Heineken NV has invested $11 million in the modernization of the Babruysk-based Sabar brewery, Syabar CEO Ela Klinyuk said at a news conference in Babruysk on Tuesday.

    The Dutch brewer acquired Syabar in December 2007. Ms. Klinyuk said that the modernization had been carried out on a tight schedule, in six months.

    The project included the modernization of the salt furnace, the construction is a new gas boiler, the launch of a new PET plastic bottle bottling line, the replacement of finished beer tanks and the modernization of the CO2 recuperation system.

    The brewery's annual capacity is projected to increase from the current 1.2 million hectoliters to two million hectoliters in 2009 as a result of the project.

    The CEO said that Syabar made 285,900 hectoliters in the first six months, with the target for the entire year set at 668 hectoliters.

    Syabar's share in the domestic market reportedly amounts to 13 percent at present.

    Belarus started grain harvesting campaign

    From: Agrimarket
    Belarus started grain harvesting campaign, reported in the Department of Plant Growing of Ministry of Agriculture and Food. According to the specialists, first 25.000 ha, or 1% of plan, were harvested. The harvesting campaign is performed selectively, the agrarians harvest mainly barley. Last year at the same date, 22% of crops were harvested due to earlier starting of the harvesting campaign.

    Grain milling totaled 83.600 tonnes, the average crop capacity – 33.3 c/ha, up 4.2 ? as compared to the previous year.

    The agrarians start harvesting campaign as grains ripen. Taking into account heavy raining on the territory of Belarus, all grain need prompt drying. The agrarians have already prepared 21.600 tonnes of flattened grains.

    According to Ministry of Agriculture and Food, the agrarians will harvest 2.52 mln ha of grains and grain legumes, up 2.4% as compared to the previous year, including 530.200 ha of rye (91.3% against the previous year), 485.600 ha of wheat (119.3%), 455.000 ha of triticale (108.8%), 571.600 ha of barley (87.8%). 174.100 ha were sown under oats, 16.400 ha – buckwheat (141%), 119.400 ha – grain legumes (100.5%).

    Minsk Says Internet to Stay Free

    From: Moscow Times
    Authorities in Belarus will not use a new law on the media to restrict the Internet, an aide to President Alexander Lukashenko said on Tuesday.

    The new law, approved by parliament last month, does not specifically require Internet sites to be registered, but allows their regulation to be overseen by government decisions.

    The Organization for Security and Cooperation in Europe, the continent's leading rights watchdog, called for rejection of the law before its passage.

    Independent journalists in the country of 10 million had expressed fears that web sites could be closed down.

    "All talk about Belarus introducing restrictions on the Internet is just sheer stupidity," said Vsevolod Yanchevsky, presidential adviser responsible for ideology.

    "The authorities feel strong enough not to be afraid of anything, including biased ideas," Yanchevsky said. "On the contrary, it is in our interest to have free development of the Internet and no restrictions. The Internet will be free in Belarus."

    Since Lukashenko came to power in 1994, many independent publications have been closed down, leaving the Internet as the chief means of information on the country's small, and often divided, liberal and nationalist opposition.

    State media in the country, wedged between Russia and three European Union states, report at length on the president's activities and heap lavish praise on his initiatives. Opposition figures are given little air time apart from brief spots, as required by law, during election campaigns.

    Lukashenko, his tough stand on dissent and generous state subsidies are broadly popular, particularly outside the capital.

    But the president remains barred from the United States and European Union on grounds that he rigged his 2006 re-election.

  • From the Opposition...

    Orsha: official violating election legislation elected deputy chairman of election commission

    From: Viasna
    On July 16th Orsha city district election commission held a meeting. It had organizational issues on the agenda. Natallia Zakharankava was elected chairperson of the commission. Zakharankava is an executive officer of Orsha city executive committee. Aleh Kazlou, head of the city executive committee’s sports department, was elected her deputy. Kazlou used to be chairman of district and city election commissions in Orsha in 1990-2006. He was known for systematic violations of the election legislation. In 2004 the Central Election Committee several times cancelled the illegal decisions made by commissions headed by Kazlou. Orsha prosecutor’s office even gave him a warning about violation of the Election Code in 2004. Nevertheless, this year he has been elected deputy chair of the district commission. On July 17th the first observer was registered at election commission # 26 – the BHC representative Siarhei Trafimau. Human Rights Defenders for Free Elections

    Membership of election commissions almost does not change during four election campaigns

    In Maladechna city district # 70, out of 13 commission members, 8 used to have appropriate positions during the last election campaigns – the parliamentary elections and referendum of 2004, the presidential election in 2006, and the local elections in 2007. In Maladechna rural district # 71, 6 (out of 13) commission members have already served as commission members during previous elections. Probably, the authorities want the “reliable” people to be commission members. Only one person from the UDF – Viktar Zhyburtovich, UCP, -- was included into Maladechna city commission. Maladechna rural election commission has no opposition members. Both commissions have one representative from Belaya Rus organization (A. Asmanau – in the city commission, and N. Liutsko – in the rural one). In addition, a member of the Republican Party of Labor and Justice was included into the rural district commission (M. Bachkou). Human Rights Defenders for Free Elections

    District commissions still haven’t started their work

    BHC observer Eduard Balanchuk did not manage to get to Maladechna rural district commission # 71 on July 17th. He was told the commission still had not started its work and still had no office. There is a similar situation at Vileika election district # 64. On July 18th BHC observer Aliaksei Siudak came to the official address of the commission (Partyzanskaya, 40 – the building of the district administration). On the first floor he even saw the signs that show the way to the office of the commission. However, the doors were locked. At the same time, the first session of the commission took place on July 15th, where the chair, deputy chair and the secretary of the commission were elected. The policeman who was on duty in that building explained one should address all questions to the organizational department of the local administration which had created the commission. Human Rights Defenders for Free Elections

    Disastrous lack of money

    From: Charter '97
    Iryna Barkouskaya, head of the department of reforming of state ownership of the Fund of State Property of the State Property Committee, said the privatisation in Belarus was caused by necessity to “animate the economy of enterprises” by means of external resources.

    “We should give up the practice of state aid to enterprises. However, the state might support some especially significant enterprises. But we must seek for external resources to animate the economy of enterprises. It is an objective of the privatisation plan,” she stressed.

    The head of the fund department also said the State Property Committee would begin to work with ministries, departments and enterprises after the privatisation plan would be adopted. Checks to prepare documents for privatisation need to be carried out at enterprises, which are planned to be reorganised in joint stock companies in 2008.

    Corporization of every Belarusian enterprise will be carried out on an individual basis taking into account its importance for the state, the official said.

    “Some directors of plants fear the Russian capital will purchase everything. But we won’t allow it. Though we have set a course to mass privatisation, the approach will be individual... We will see in what degree an enterprise is important for us and if it is attractive for investors. We will think about every concrete investor, when creating a joint stock company and selling shares, to know what block of stock can be offered to it,” BelTA quotes Iryna Barkouskaya.

    She doesn’t exclude blocks of stock up to 25 per cent of the authorised fund can be offered to investors on the first stage. “As a rule, investors are interested in these blocks. It gives them real power in the forming company,” the specialist emphasised.

  • Around the region...

    BP recalls its last staff from Russia

    From: Telegraph
    BP's battle to stay in oil-rich Russia has been dealt a major blow after the UK company was forced to withdraw its last engineers and technical staff from the country.

    After months of pressure the company bowed to the inevitable yesterday and withdrew the remaining 60 staff it had assigned to work at TNK-BP, the joint venture at the centre of a power struggle between BP and three Russian oligarchs.

    The withdrawal marks a further slip in BP's grip on Russia's third largest oil producer, which accounts for 25pc of the UK company's annual production and last year made profits of $5bn on sales of $38bn.

    Next week, Robert Dudley, chief executive of TNK-BP and a former employee of BP, may be forced to leave Russia in a row over his work permit, putting BP's partners in de facto control of the joint venture.

    More on oil
    In all, 148 BP secondees to TNK-BP have been forced to leave following a dispute over the renewal of visas that started in March.

    The Moscow immigration office eventually approved the visas, but the employees were barred from TNK-BP's Moscow offices by security guards.

    Then, in May, a previously unknown investment company, Tetlis, got an injunction in Tuymen, Siberia, blocking the visas, claiming that the BP staff enjoyed inflated salaries.

    The Daily Telegraph tried to contact Tetlis, but a Moscow address listed on court documents housed a chemist shop and a grocers. A second address, registered with the authorities in Moscow, was a children's nursery.

    Yesterday, BP said that the Tuymen court case had made little progress and there was no point having valuable employees idle in Russia when they could be redeployed on other business in the Middle East and Gulf of Mexico.

    "We are taking this action reluctantly," Lamar Mckay, BP's executive vice-president, said. "These technical experts have played a huge part in making TNK-BP one of Russia's most successful oil companies in the past few years."

    Analysts said losing the BP specialists would probably start to impact on TNK-BP's operations by the end of the year. "These people work on projects with long lead times. The impact will start to be felt in a few months."

    However, Stan Polovets, chief executive of Alfa-Access-Renova (AAR), the consortium representing the Russian investors, welcomed BP's decision.

    He said: "We respect BP's decision and are confident it will not have an adverse impact on TNK-BP's operations. The BP secondees have not been working for TNK-BP for many months now, and the company's operations have not been hampered in any way. In fact, production has been up for the past three quarters, as our colleagues from BP have noted."

    In addition to the secondees, about 85 former BP employees, including Mr Dudley, are now directly employed by TNK-BP. All are facing problems with work permits and visas.

    AAR claims that BP runs TNK-BP for its own benefit, rather than for all the shareholders, and has been campaigning for the removal of Mr Dudley. BP denies the claim.

    AAR argues that he no longer has an employment contract, and therefore must leave Russia when his visa expires next week. BP says the contract is renewed automatically.

    No quick solution to Russia-Georgia crisis

    From: Kuwait Times
    Western diplomatic efforts to defuse tensions between Georgia and Russia may not yield immediate results, but they have already changed matters by depriving Russia of exclusive control of the situation, analysts said. Europe and the United States initiated their attempts to end the dangerous dispute over Georgia's breakaway region of Abkhazia "as tensions reached an extremely high temperature," Archil Gegeshidze, a political analyst at the Georgian Foundation for Strategic and International Studies, told A

    The EU and the United States seek a stable and democratic Georgia" with its oil and gas pipelines connecting the Caspian Sea to Turkey and its strategic location in the eastern edge of the European continent, he added. As for Russia, which has grown more assertive in recent years, restoring influence in the South Caucasus is largely seen by its political elite as an "existential issue," Gegeshidze said.

    The row over Abkhazia and another separatist Georgian region, South Ossetia, is at the heart of increasingly bitter relations between Moscow and Tbilisi, amid Russia's broader offensive against Western influence in its former Soviet backyard. The increase in tensions has helped Moscow impede its neighbour's bid for membership in the NATO military alliance. But now the region has seen a flurry of Western diplomatic activity, including visits by US Secretary of State Condoleezza Rice and German Foreign Minis
    ter Frank-Walter Steinmeier.

    The Western factor has irreversibly changed the status quo around Georgia's conflict regions. With the West entering the Caucasus game, Russia is not the first violin there anymore," Alexei Malashenko, a political analyst at the Carnegie Moscow Centre, told AFP. Although the self-proclaimed governments of Abkhazia and South Ossetia, which broke away from Tbilisi in the early 1990s, are not formally recognised by any state, Russia tacitly supports the separatists and maintains peacekeeping troops in the tw
    o regions.

    Tensions mounted further this month with a series of bombings in Abkhazia, which the Abkhaz leadership blamed on Georgia, and Moscow's admission that it had sent military jets on flights over South Ossetia. The incidents raised memories of the two regions' separatist wars in the early 1990s, which killed several thousand people and forced hundreds of thousands to flee their homes.

    In light of the escalation in the last weeks and months, we all have a common duty to help defuse the situation," German Foreign Minister Steinmeier said on Friday after meeting Abkhaz leader Sergei Bagapsh during a two-day visit to the region. "The West is giving Georgia a chance to resolve the crisis through a sophisticated diplomatic game," Tornike Sharashenidze, an analyst at the Georgian Institute of Public Affairs, told AFP. "Georgia now has to demonstrate its ability to follow this process with pat
    ience. Otherwise it risks losing Western support," he said.

    The first Western bid to end the crisis received a cool response Thursday as Georgia rejected key elements of a three-stage conflict resolution plan proposed by Germany. Abkhazia rejected the plan on Friday. The German plan includes the signing of a legally binding document committing both sides to refrain from the use of force and allow around 250,000 displaced Georgians to return to Abkhazia.

    Those steps would be followed by economic aid to the region, with Berlin organizing a donors' conference, and finally a political solution. Steinmeier's plan "was just a first attempt at finding a way out of crisis. Only long-term efforts with the participation of all parties involved may lead to mutual concessions," Sergei Mikheyev, the vice president of the Moscow-based Centre for Political Technologies, told AFP.

    Russia needs guarantees for its interests in the region. In the case such guarantees are provided, it may agree" to cooperate with the West on conflict resolution in Abkhazia and South Ossetia, he added. Malashenko said that "it's extremely difficult, but still possible to find a formula for conflict resolution that would be convenient for all parties," adding that it would take "very careful diplomatic work". "Any harsh moves may lead to fatal consequences," he added.

    Russia's Gazprom chief calls for long-term natural gas contracts with Ukraine

    From: IHT
    The head of Russia's natural gas monopoly OAO Gazprom on Monday called for a long-term deal with Ukraine as the country faces major hike in the price for gas.

    Gazprom CEO Alexei Miller was in Kiev to talk to Prime Minister Yulia Tymoshenko and other officials about signing a gas supply contract for 2009 and beyond.

    "We should be aiming for a long-term contract, I hope that in the course of today's meeting we can discuss the principles of organizing such work," Miller was quoted as telling Tymoshenko, according to a government statement.

    With world energy prices on the rise, Gazprom has said that Ukraine's current price of US$180 per 1,000 cubic meters could more than double next year to US$400.

    Ukrainian officials have said such a steep rise could cripple the economy and has instead asked for a phased increase.

    Tymoshenko agreed with the need for a long-term agreement. "We are extremely interested in considering each other reliable partners," she was quoted as saying.

    Russia and Ukraine have uneasy relations when it comes to natural gas supplies. Pricing disputes in the past have led to gas cut-off and supply reductions, which also affected consumers in Western Europe.

    Russia is angered by Ukraine's aspiration to integrate its long-term economic and security policies with Western institutions like the European Union and NATO.

    Ukraine parliament to discuss Russian fleet pullout preparations

    From: Ria Novosti
    A bill on preparing for the Russian Black Sea Fleet's withdrawal from Ukraine's Crimea by 2017 is ready and will soon be submitted to the Ukrainian parliament, the country's foreign minister said on Tuesday.

    "The bill is ready and will be submitted for consideration. We will now wait for the Supreme Rada to adopt this law," Volodymyr Ohryzko said.

    Frequent disputes have flared up between Russia and Ukraine over the lease of naval facilities on the Crimean peninsula.

    Russia's Black Sea Fleet uses the Sevastopol base under an agreement signed in 1997. Ukrainian President Viktor Yushchenko recently decided not to extend the lease beyond May 28, 2017.

    In early June, Russia's lower house of parliament adopted a resolution saying the Russian-Ukrainian cooperation treaty could be denounced if Ukraine joins NATO.

    Ukraine's pro-Western leadership has been pursuing NATO membership since the 2004 election of President Viktor Yushchenko. Ukraine failed to secure an agreement on a NATO Membership Action Plan, a key step toward joining the alliance, at the organization's summit in April, but was told the decision would be reviewed in December.

  • From the Polish Scandal Files...

    Pregnancy no defence against arrest

    From: The News
    Arresting pregnant women is in accordance with Constitution, says Poland’s Constitutional Tribunal.

    Regulations allowing the temporary arrest of pregnant women are in accordance with the Constitution, judged the Constitutional Tribunal on Tuesday.

    The issue relates to when the accountant of Marek Dochnal, a Polish businessman accused of corruption, was arrested two weeks before the planned date of birth of her baby.

    Poland's ombudsman decided that the action constituted "inhumane and cruel treatment" and handed the case over to the Tribunal, the highest authority on the Constitution in Poland.

    The Tribunal decided that arresting pregnant women is constitutional, however.

    The law allows arresting pregnant women but if their health requires it, they can be detained in a medical institution.

    Ombudsman Janusz Kochanowski challenged the law by referring it to the Constitutional Tribunal after Maria S., Marek Dochnal's accountant, was placed under arrest in 2006 despite being two weeks away from giving birth. In the end, she gave birth in prison.

    Poland’s IPN publishes files of 2,300 Communist-era secret services collaborators

    From: Axis
    The IPN, Institute of Public Remembrance, Poland's war and Stalinist-era crimes authority, has published on its internet site the files of some 2,300 employees and collaborators of Communist-era security services, Polish Radio reports.

    The files include those of 1980s Interior Minister Czeslaw Kiszczak, security police chief Wladyslaw Ciaston, who had been involved in the kidnapping and murder of the Solidarity movement chaplain Jerzy Popieluszko, and around 500 other high-ranking members of the party and government administration.

    The Institute has also supplemented its internet lists of persons who had been in the interest of the security services, radio adds. Among the files is that of the husband of Julia Pitera, the minister responsible for fighting corruption. A known documentary film maker, Pawel Pitera, has denied that he had ever acted as an informer for the security services in Communist times, Polish Radio says.

    Polish man died after urinating on third rail

    From: UPeeI
    London authorities said a Polish tourist died of electrocution when he urinated on a live 750-volt third rail at a city railway station.

    The 41-year-old man was found by rail workers after they watched him walk into a recessed area on closed circuit television and fail to emerge, The Daily Mail reported Tuesday.
    It took police a week to identify the victim after the tragedy.

    A source said: “Perhaps because he was from Poland he had no idea the rail was electrified. His family back home are heartbroken.”

    Rail workers said the man, a schoolteacher who was believed to have been visiting London to improve his English, may not have known that some British railway tracks are electrified.

    The Vauxhall station has no toilets, the newspaper said.

    Polish newborn dies after being thrown from window

    From: AP
    A newborn baby girl died after being thrown from a third-story window in the Polish capital, apparently by a drunken relative, police said Tuesday.

    The baby was found Monday night, with the umbilical cord still attached, on the sidewalk beneath her family's apartment block in Warsaw's gritty Praga district, police spokeswoman Monika Brodowska said.

    Rescuers rushed the baby to the hospital with multiple injuries, but she died soon after, she added.

    Police established that the girl had been thrown from a third-floor apartment, but the occupants refused to let them in. Firefighters were called to help officers get in from the balcony, Brodowska said.

    Brodowska said officers found a 34-year-old woman in the apartment, identified as Aneta W. Her "state of health signaled that she had just given birth."

    The woman was taken to a hospital. The other two people in the apartment — the woman's mother, Lidia L., and husband, Zbigniew W., 40, were both detained.

    They were not identified by last name, in keeping with Polish privacy laws.

    The death is being treated as a murder, said Renata Mazur, a spokeswoman for regional prosecutors.

    All three adults had large amounts of alcohol in their blood and prosecutors are waiting for them to sober up before questioning them to determine who threw the child out the window, Mazur and Brodowska said.

    Polish crime ring targets banks

    From: Pioneer Local
    Two men suspected by police of being members of an organized Polish crime ring were arrested last week in Des Plaines, accused of defrauding several suburban banks by using stolen identities and falsified paperwork to obtain car loans.

    Grzegorz Glod, 41, of 5125 W. Addison St., Chicago, and Artur Bledowski, 41, of 8901 Western Ave., unincorporated Maine Township, have been charged with four counts each of bank fraud, identity theft, forgery and felony theft in Des Plaines. They are accused of stealing more than $100,000.

    Glenview police have also charged Glod with identity theft, forgery and theft by deception in connection with a loan obtained from a Chase Bank branch that was used to purchase a 2008 Lexus from a local car dealership.

    Police in Niles, Chicago, and Island Lake are also investigating similar crimes.

    Des Plaines police said Glod and Bledowski obtained car loans from banks using altered vehicle titles, bogus sale bills from dealerships, and the identities of other individuals. Once the loans were approved, the checks were deposited into a bank account and the money was used to purchase expensive cars, jet skis, all-terrain vehicles or recreational vehicles. The vehicles were then shipped to Poland, police said.

    It was not until after the loan had been defaulted on that the banks discovered the paperwork submitted was fraudulent, said Des Plaines Police Commander Dan Niemann.

    "We're pretty sure the fraudulent paperwork they are using is for bogus companies that are being used as fronts for them and their scams to get money from banks," Niemann said. "As far as we know, we don't have a legitimate business that has any ties to them."

    Police took Glod and Bledowski into custody on July 17 after the men attempted to obtain a loan from First Bank, 678 S. Lee St., in Des Plaines, Niemann said.

    Niemann said area banks that had fallen victim to similar frauds had sent out alerts, and an employee at First Bank became suspicious about a loan applied for by a man later identified as Glod.

    Police were contacted, and when Glod and Bledowski arrived at the bank to sign off on the paperwork and obtain their loan, they were arrested, Niemann said.

    The three other Des Plaines banks allegedly targeted by the pair were U.S. Bank, 750 S. Lee St.; Fifth-Third Bank, 510 Metropolitan Way; Citicorp, 1525 Ellinwood St.

    Glod was the individual who applied for the loans, while Bledowski accompanied him and acted as a translator, Niemann said.

    One of the identities allegedly used to obtain a loan belonged to a Mount Prospect man who told police he did not know Glod nor Bledowski and was unaware of how they had accessed his personal information.

    Bond for Bledowski was set at $750,000 for the Des Plaines charges, and bond for Glod totals $1 million for both the Des Plaines and Glenview charges, Niemann said.

    Both men were also ordered to surrender their passports, Niemann said.

    Des Plaines police are also working with investigators from the Kane-Cook Auto Theft Task Force and the National Insurance Crime Bureau.

  • Sport...

    Belarus has done its best to prepare Olympic delegation, Belarus President says

    From: BelTA
    A young Belarusian state has done everything to prepare the national Olympic team on a good level, President of Belarus Alexander Lukashenko said at the solemn farewell ceremony for the Belarusian delegation who are going to the Beijing Olympic Games.

    “The Belarusian sportsmen have won the Olympic licenses in 130 disciplines of 26 sports of the Olympic programme. It is the best result compared with all the previous Olympic Games,” the Belarusian head of state noted. “Hopefully your results at the Olympic Games will be just as high,” he added.

    Alexander Lukashenko underlined that due to the achievements of the Belarusian sportsmen in the recent years, Belarus came to be known as a sports nation. “Your victories are a powerful impetus for the development of physical culture in towns and villages. Keep in mind that here, at home, every Belarusian, young and old, will be rooting for every one of you,” the head of state assured the Belarusian athletes. “I am excited just as much as you are,” he added.

    According to the President, a good performance of the athletes is what matters most. “Support each other. The success of one of you is the success of all of us,” the head of state concluded.

    Alexander Lukashenko talked to the representatives of each kind of sport and wished them well.

    Cesc Could Rejoin Barcelona - Hleb

    The Belarussian playmaker revealed that his great friend at Arsenal showed him around the Catalan capital on a previous trip and still loves the club where he began.

    Fabregas was strongly linked with a return to Camp Nou last summer and Hleb thinks that he could well be tempted back in next few years because of his feelings for the Blaugrana.

    "He loves this club, and though he’s at Arsenal, who knows, maybe one day he’ll come back here," he explained. "He and Flamini were my best mates at Arsenal.

    "I once came to Barcelona from London with Cesc, but that was only a day-trip and I saw little of the city which is now my home.”

    While Hleb's words will not impress Arsone Wenger, the fact that the 27-year-old considers that only now has he joined a great club may anger a few Arsenal fans.

    “It’s a great opportunity for me. Since I was seven my dream has been to play for a great club like Barca. I love Bar?a and I want to do my very best to try to win as many titles as possible," he continued.

    “I know it’s a great team, with great players. What I want to do is to integrate, play good football with them and obviously win.”

    Hleb will team up with Henry again at Bar?a and the pair were inseparable on when training together for the first time last Friday.

    Accusations that they did not perform well together at Arsenal does not bother the former Stuttgart forward and he is delighted to be back alongside his friend.

    "He’s my mate. We spent two years together. We understand each other and I’m real pleased to be back with him," Hleb added.

    At the Tour

    At the 16th stage of the Tour de France, Belarusian Konstantsin SIUTSOU has climbed to 22nd place overall with 8 consecutive top 40 finishes. The TEAM COLUMBIA climber also sits in 13th place for the checkered jersey, worn by the king of the mountains. He is 19"10' behind Frank Schleck of France, the current tour leader.

    Aleksandr KUSCHYNSKI, another Belarusian riding for LIQUIGAS is in 117th place, 2"31' behind the leader.

  • Cultural scene...

    Concept of 18th international festival of arts Slavonic Bazaar in Vitebsk to be designed by October

    From: BelTA
    The finale of the 17th international arts festival Slavonic Bazaar in Vitebsk
    The concept of the 18th international festival of arts “Slavonic Bazaar in Vitebsk”, which will be held in July 2009, will have been designed by October this year, Alexander Kosinets, Deputy Prime Minister of Belarus, chairman of the organisational committee of the festival, told reporters.

    Speaking about the cultural component of next year’s festival Alexander Kosinets said that the festival won a huge popularity over the past decade and has started playing an important role in the cultural life of not only Belarus. This year almost all continents of the planet, 34 states were represented at the festival. “It is time the national art of Africa, America Europe was represented at the festival,” Alexander Kosinets said.

    One of the most interesting contests – the international song contest - needs a new format. We need to increase the viewership as much as possible, Alexander Kosinets said.

    The economic part of the concept of the 18th international festival should be geared towards getting as much profits as possible and should rely on a self-repayment principle. Steps should be taken to develop tourist, roadside infrastructure of Vitebsk and neighbouring regional centres. “This all will promote the development of the festival, meet the needs of people and will bear well on the economy of the regions and the country on the whole,” Alexander Kosinets said. He also praised the organisational level of the 17th international festival of arts.

    Belarus’ opera touring Canaries and Germany

    The National Academic Opera Theatre of the Republic of Belarus is giving performances in Canary Islands and will go to Germany in August, BelTA learnt from Director of the theatre Valery Gedroits.

    Spain is hosting an opera festival in Canary Islands in July-August. The Belarusian opera artists are engaged in the plays Nabucco and La Traviata by Giuseppe Verdi and will perform Requiem by Mozart.

    The second part of the theatre company will bound for Germany to partake in an opera festival in the towns of Monschau and Saarbrucken on August 26-29. The Belarusian artists will play Madame Butterfly by Puccini and Nabucco by Verdi. The soloists of the Belarusian opera will perform Puccini’s Tosca, the Barber of Seville by Rossini and will take part in a gala-concert.

    After the tours that traditionally establish cultural contacts, the National Academic Opera Theatre will open the 76th theatre season with Verdi’s Aida on September 16. The repertoire will include new plays – Rakhmaninov’s Aleko and Verdi’s Macbeth. The theatre company has almost prepared for the play Macbeth – made costumes, scenery and held rehearsals. The full version of the play will be staged in the National Academic Opera Theatre of Belarus in 2009.

    Valery Gedroits added that the Belarusian opera has always had success in the country’s regions. The soloists performed at the Summer Amphitheatre. Vitebsk saw the play Carmen by Bizet within the cultural action We Are Belarusians. The soloists of the Belarusian opera also gave concerts in Gomel, Bobruisk, other towns, agro-towns, rural settlements.

  • Endnote...

    Coming In from the Cold?
    World Bank's new man in Belarus tells Russia Profile that the country might be at a turning point

    From: Russia Profile
    In a pivotal move which has yet to attract attention in the West, Belarus, often dubbed as “Europe’s last dictatorship,” has shifted the tenets of its economic strategy, and is now actively seeking foreign investment. And it’s targeting the West.

    Many analysts in Minsk see the energy dispute with Moscow at the start of 2007 over subsidized gas prices and customs-free oil exports as marking a break in Belarusian economic strategy. In 2007, Russia put Belarus on a one way track to paying European prices for its gas by 2011, and also ended duty-free oil exports that allowed its small neighbor to earn millions by refining and exporting oil to Europe.

    The booming Belarus economy, running at full capacity, with 8 percent annual GDP growth par for the course, was urgently demanding capital investment to stop bursting at the seams. The price rises put a dent in the idea that the state could do it all by itself.

    Moreover, the Kremlin actively backed liberalization in Belarus in the hope that Russian capital would move in with vigor.

    Having learnt a bitter lesson from the Ukrainian experience under Leonid Kuchma – when Russia subsidized Ukraine with cheap gas, while Russian companies were cut out of the privatization process – Russia has step-by-step shifted to a “non-ideological” approach in dealing with its neighbors.

    Newly elected president Dmitry Medvedev confirmed this change on July 15 in his first major speech on foreign policy principles:

    "We are fed up with ideological investments. As you know, they were made in the previous period, and it is plain to see how they were paid back. And there should be no clawing at our money, which was inefficiently spent to support corrupt regimes in the future," Medvedev told the Russian diplomatic corps, as quoted by Interfax.

    So if bumping up energy prices forced Belarus to open its economy to investors, it was a win-win situation for Russia.

    In fact, the new head of the World Bank mission to Belarus as of spring 2008, Martin Raiser, dates the Russia-prompted shift in Belarus policy even further back than January 2007.

    "Key aspects of economic policy changed already a few years back. In particular, the unification of the exchange rate and the customs union with Russia meant that key market signals have already been in operation for some time," says Raiser in emailed comments.

    “With the rise in energy import prices from Russia, there has been an additional push for greater efficiency and competitiveness,” Raiser explained. “And this has led to a renewed emphasis on private investment and initiative in Belarus. This is new and it is welcomed."

    Reform moves

    It was in 2007 that the Belarus administration startled analysts by announcing and launching implementation of a draft of reforms aimed at improving the investment climate.

    There was and still is a lot to improve on. Pro-private sector measures introduced in 2007 saw Belarus leap up thirteen places on the World Bank's Ease of Doing Business Index – from 123rd place to an only slightly less embarrassing 110th place in the world.

    But this is only the start, say analysts. According to the World Bank's Doing Business blog, "in February 2008 the Doing Business team met with forty-five government officials from seventeen different agencies of the Republic of Belarus. Every single one of these representatives expressed their absolute commitment to ease business regulation in the country. Their aim is to be among the top twenty-five countries in the ease of doing business and top ten reformers in the World Bank's Doing Business 2009 report."

    In 2007, Belarus also took crucial steps such as acquiring a credit rating, and launching large-scale privatization – with the sale of second largest mobile operator, Velcom, to Telecom Austria, for over 500 million euros.

    An indication of the dominant state role in the Belarusian economy until 2007 was that all three mobile phone operators were joint ventures with the state. But in 2008 the state is looking to sell its remaining stakes in operators MTS and BeST. Bank privatization is also on the cards, with Germany's Commerzbank looking set to acquire fifth largest Belinvestbank. Austria's Raiffeisen International already owns the country's third largest bank, Prior Bank.

    This burst of reform activity in 2008 has caught many observers by surprise. Many expected the reform drive to be slow. However, as energy prices in 2008 have shifted back in Belarus' favor, the country looks likely to run in a record trade surplus instead of the feared deficit this year. But according to Dmitry Kruk of Minsk's Institute of Privatization and Management, the government has redoubled its liberalization efforts this year, indicating that “a strategic decision” has been taken by the president.

    Key challenges

    World Bank's Martin Raiser sees three key challenges facing the government.

    "Belarus in some sense benefits from the fact that several of its key industrial assets are relatively new (built in the late 1980s) and that government-led efforts have achieved some success in modernizing the flagship companies," Raiser said. "But a lot of inefficient, often state-owned enterprises still exist in smaller towns which will need to attract private strategic investment if they are to survive."

    "Secondly, Belarus needs to make better use of its key assets – an educated labor force and a strategic location as a bridge between Russia and Western Europe. For this, it needs to encourage innovation and entrepreneurship to complement the high human capital, while it must also reorient trade and transport links towards Europe and make it easier and cheaper to transit across its territory," Raiser continued. "Thirdly, Belarus will need to cope with a deteriorating demographic position and the implications this has for the social inclusiveness of future economic growth. As the labor force declines due to an aging populace and migration, the financing of generous social transfers through high levels of payroll taxes will come under pressure and the need to improve targeting of social assistance for the most vulnerable and to encourage greater labor force participation will become ever more pressing."

    The question facing Belarus is whether the top-down approach pursued by the government is sufficient to master these challenges. Raiser notes that, while the government has "the ambition to tackle these challenges broadly," the authorities "are aiming at efficiency improvements rather than wholehearted institutional change."

    Between Europe and a hard place

    Nevertheless, the logic of reform in Belarus might yet kick-start some political liberalization to make the country more acceptable in the eyes of the West.

    If economic reform in Belarus was initially prompted by relations with Russia shifting to market principles, then reforms now seem to target West European investors, according to Viktar Strachuk of Deloitte, precisely to avoid Russian capital predominating in the country.

    The government wants Western investors to counterbalance Russian influence. But Western investors are still wary of Belarus, because of the stigma attached to “Europe's last dictatorship.” So, ultimately, economic reform will require some degree of political liberalization at least in the form of some masquerade. Lukashenko seems to have recognized himself that image is important: in early 2008, he hired famous British spin doctor Lord Tim Bell, who previously worked for General Pinochet, Boris Berezovsky and the British Conservative Party.

    Lukashenko has even promised that the upcoming parliamentary elections in September 2008 will be a “model of democracy.” The claim has met with understandable skepticism from opponents. However, there is considerable room for Lukashenko to liberalize and allow opposition, without losing his iron grip on power, since he enjoys Putinesque levels of popularity, as the economy surges ahead.

    On the other hand, such a move would require Belarus' “Bat’ka” to at least allow public questioning of his infallibility – and there has been little sign that he is psychologically ready for this