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Today's Headlines for:
Sunday, December 21, 2008

President promises liberalization, EU normalising relations, Children may go abroad, Russia, Gas, Nukes, Ukraine, Polish scandal, Culture and Sport

  • From the Top...
  • #370

    Belarus President promises liberalization of economy, society

    From: BelTA and the Office of the President
    The "World Stars" team has lost an ice hockey match against the "Gazprom Export" team with the score 5:9. The sporting event was held on 19 December in Moscow to mark the 90th anniversary of the legendary ice hockey coach Anatoly Tarasov. Participating in this friendly match was President of Belarus Alexander Lukashenko.
    Both the economy and society will be liberalized in Belarus, President of Belarus Alexander Lukashenko said in an interview with heads of leading Belarusian mass media on December 18, BelTA has learnt.

    “We should break the bureaucratic stranglehold on the economy. Bureaucracy should not dominate the economy when the financial and economic crisis is raging on the world,” Alexander Lukashenko underlined. According to him, the economy should be given a chance to develop freely. “There should not be any excessive administrative pressure on the economy, all the processes should be liberalized and people should be given comfortable conditions to do their work,” he said.

    The Belarusian Head of State underlined that it is essential to support the initiative of people, they should be able to register their enterprises freely and work comfortably. “We should give the state enterprises as much freedom as private business has,” Alexander Lukashenko underlined. He added that the state is ready to withdraw from those areas which can do better without state control.

    The President noted that a number of enterprises will be privatized but it will be done at market prices. The key enterprises will only be sold in extraordinary circumstances. Today there are no such circumstances in Belarus, despite the global financial crisis.

    Alexander Lukashenko informed that he signed important documents regarding the liberalization of economy. They will be published in the near future.

    The President’s interview will be aired by TV Channel One, ONT and STV at 21.00 on December 18.

    Belarus’ President abolishes registration of leasing agreements; imposes minimum 3-year lease term

    President of Belarus Alexander Lukashenko has signed Decree No 24 “Rental of permanent structures (buildings, facilities), isolated premises” on December 19, BelTA learnt from the presidential press service.

    One of the challenges all businesses face sooner of later is the necessity to rent premises for establishing production facilities of setting up an office. In the majority of cases, lessors appear unwilling to sign lease agreements for a long-term period with potential lessees. One of the reasons for that is the necessity to get a state registration of lease agreements that are concluded for more than a year and a rather bureaucratized registration procedure. This is why the agreements are usually signed for ONLY 11 months.

    This hampers sustained work of lessees and serves a favorable ground for various violations.

    In order to address this problem, the Belarusian Head of State signed a decree that introduces a three year period as a minimum period of leasing (subleasing) permanent structures (buildings, facilities), isolated premises in the state and private ownership. For the period of less than three years the agreements can be signed only with the consent of lessees.

    Additionally, with a view to removing excessive bureaucratic barriers and encouraging businesses to sign long-term agreements, the decree abolishes the state registration of property leasing and subleasing agreements, the property uncompensated use agreements, amendments and addenda to these agreements and their dissolution. Such agreements will come into effect on the day they are signed.

    The lessors (lenders) will only have to notify a local body for the state registration of property about the agreement, the amendments or addenda to it or its dissolution within 10 days so that it can be enlisted in the register. The whole procedure is free of charge.

  • Other Belarusian News...

    EU interested in normalising relations with Belarus

    From: BelTA
    The European Union is interested in normalising relations with Belarus, Head of the EC Delegation in Ukraine and Belarus Jose Manuel Pinto Teixeira told media after meeting with Vice-Premier of Belarus Andrei Kobyakov in Minsk on December 18.

    Normalisation of Belarus-EU relations is possible in all areas, said the official.

    He noted that in October the Luxembourg session of the EU Foreign Ministers Council made a decision, which allows and enables high-level contacts between officials of Belarus and the European Union.

    At present the European Union continues monitoring Belarus in order to take further decisions regarding the development of relations with Belarus. The head of the European Commission mission said he hopes that the normalisation of Belarus-EU relations in all areas will become possible. In his words, the European Union is interested in normalising relations with Belarus. “We are satisfied with several steps taken by Belarus in line with EU expectations,” said Jose Manuel Pinto Teixeira. The changes are visible in view of new proposals of the European Commission concerning eastern partnership. It is part of the summit, which will take place in Prague in May 2009. The event is part of the programme of the Czechia presidency in the European Union, remarked the head of the European Commission mission.

    Belarus government, European Commission sign framework agreement

    The Belarusian government and the Commission of the European Communities have signed a framework agreement, BelTA learnt from the Belarusian Foreign Ministry. The document was signed during a Minsk meeting of Belarus Deputy Prime Minister Andrei Kobyakov with Head of the EC Delegation in Ukraine and Belarus Jose Manuel Pinto Teixeira.

    The framework agreement is meant to create the legal basis for further development of cooperation between Belarus and the European Union in the area of technical aid within the framework of the European Neighbourhood and Partnership Instrument, which replaced the TACIS programme.

    Apart from that, the parties signed a protocol on the interpretation of the terms and definitions the agreement uses.

    Good prospects for development of Belarus-EU relations, Boris Batura says

    The relations between Belarus and the European Union will develop in a positive way, said Chairman of the Council of the Republic of the National Assembly of Belarus Boris Batura after the closing of the first session of the fourth convocation Council of the Republic on December 19, BelTA has learnt.

    “Belarus and Europe remain committed to the political rapprochement. It is evidenced by the fact that the Council for Cooperation of Local Self-Government Bodies of the Council of the Republic of Belarus was admitted to membership of the Congress of Local and Regional Authorities of the Council of Europe,” Boris Batura said.

    The Chairman of the Council of the Republic of the National Assembly noted that Europe understands that Belarus is a European state. According to Boris Batura, the Council of Europe is interested in the cooperation with Belarus.

    Council of Republic ratifies agreement on opening, privileges and immunity of EC’s office in Minsk

    On December 19, the Council of Republic of the Belarus National Assembly ratified the agreement between the Republic of Belarus and the European Commission on the opening, the privileges and the immunity of the European Commission's Representative Office in the Republic of Belarus”, BelTA informs.

    The agreement was signed in Brussels on March 7, 2008. The main goal of the agreement is to strengthen and develop the friendly relations and cooperation between Belarus and the European Communities. The agreement foresees the opening of the European Commission's Representative Office in the Republic of Belarus. The European Communities have the right to conclude contracts, purchase property and administer the estate in line with the Belarusian legislation.

    The agreement is based on the 1961 Vienna Diplomatic Relations Convention.

    On December 19, the Council of Republic of the Belarus National Assembly ratified the memorandum between the governments of Belarus and Qatar on cooperation in the security area. The senators also ratified the Belarusian-Vietnamese agreement on cooperation in plant protection.

    No plans to terminate recuperation programmes of Belarus’ children abroad

    From: BelTA
    Belarus does not plan to terminate recuperation programmes of Belarusian children abroad, Press Secretary of the Belarusian Foreign Ministry Andrei Popov told reporters, BelTA has learnt.

    Belarus lifts restrictions on travels of Belarusian children for recuperation purposes during winter holidays to the foreign countries, with which Belarus has not signed international agreements yet. It is consistent with the position that Belarus takes on this issue, Andrei Popov said.

    “We are grateful to those states, international bodies and nongovernmental organizations that implement such projects. But taking into consideration the incidents when foreign families tried to keep Belarusian children without permission of their lawful guardians, foreign states have to provide firm guarantees of a safe return of our children,” the Press Secretary of the Belarusian Foreign Ministry said.

    According to him, the Belarusian side had informed its international partners about its plans in advance. As early as in September, the Belarusian side had submitted the relevant draft international agreement to 22 countries, namely Austria, Belgium, Bulgaria, the UK, Germany, Greece, Denmark, Ireland, Spain, Canada, Latvia, Lichtenstein, Luxemburg, the Netherlands, Norway, Poland, the US, France, the Czech Republic, Switzerland, Japan.

    Andrei Popov noted that Belarus and Ireland are rapidly progressing in the development of the relevant agreement. Italy signed this document in 2007. At the same time, Andrei Popov stated that, unfortunately, the work on this agreement with other countries is making little headway and it is not the fault of the Belarusian side. “Nevertheless, we are ready to step up our efforts. We hope that it will help us adopt efficient legal tools that will secure the safe return of Belarusian children,” Andrei Popov underlined.

    “We think that this stance of the Belarusian side is absolutely justified and must be understood both in Belarus and abroad,” he added.

    Belarus, Russia harmonize security systems

    From: BelTA
    Belarus and Russia have set up the harmonized security systems which allow the two countries to protect the interests of the peoples and states, Anatoly Vankovich, the Chairman of the Commission for Security, Defense and Fight against Crime of the Parliamentary Assembly of the Belarus-Russia Union State, the Deputy Chairman of the Permanent Commission for National Security of the House of Representatives of the Belarus National Assembly told a press conference in Minsk on December 19, BelTA informs.

    Summing up the 13th session of Parliamentary Assembly’s seminar on Belarus-Russia Union State’s construction which was held in Minsk, Anatoly Vankovich noted that the main goal of the seminar was to develop the decisions which will promote the cooperation of both the countries in the military area.

    According to him, Belarus and Russia carry out 17 joint programmes concerning the maintenance of security of the Belarus-Russia Union State. About 50% of the Union budget is assigned for these programmes.

    At the same time, Anatoly Vankovich noted that it is necessary to improve the coordination of the joint actions in the security area, monitoring of threats and challenges, forecast, development of mechanisms of cooperation strengthening.

    Participants of the seminar will develop recommendations taking into account the proposals of participants of the seminar. The recommendations are expected to be introduced before the Supreme State Council of the Council of Ministers of the Belarus-Russia Union State, Anatoly Vankovich added.

    Belarus, Russia to hold joint military exercise in H2 2009

    The joint large-scale military-strategic exercise of the Armed Forces of Belarus and Russia ‘West 2009’ will take place in H2 2009, Alexander Yanovsky, chief of the department of the main operational control office of the General Staff of the Armed Forces of Russia, told a press conference in Minsk following the 13th session of the Parliamentary Assembly permanent seminar on the formation of the Union State, BelTA informs.

    According to Alexander Yanovsky, the decision to hold the exercise has been taken by the defense ministers. The chiefs of the general staffs of the armed forces of the two countries have agreed the main approaches to all aspects of its preparation. Today the sides are considering the plot, venue, the number of units and means to be involved in the exercise. In the near future the two sides will hold on-site events including reconnaissance and determine the date. The exercise is to take place in H2 2009.

    The representative of the General Staff of the Russian Armed Forces said that the military cooperation between Belarus and Russia has been successfully developing including in the area of joint exercises. Since 2002 the two sides have carried out joint tactical exercises between individual subdivisions; operational and strategic, command and staff exercises among the regional troops; the Shield of the Fatherland command and staff exercise with the transference of the Russian subdivisions to the Obuz-Lesnovski training ground in Belarus; a joint command and staff exercise.

  • Economics...

    State Commission chooses Ostrovetskaya site to construct Belarus’ nuclear power plant

    From: BelTA
    Belarus’ nuclear power plant will be built at the Ostrovetskaya site in the Grodno oblast. The State Commission for Belarus’ Nuclear Power Plant Location has taken the relevant decision on December 20, BelTA learnt from Lyudmila Zenkovich, press secretary of the Energy Ministry of Belarus.

    The choice was made after the examination of the Ostrovetskaya, Krasnopolyanskaya and Kukshinovskaya sites.

    The Commission approved the decision of the survey organizations. The relevant documents were signed.

    A reminder, a political decision to build a nuclear power plant in Belarus was taken at a session of the Security Council of Belarus that was chaired by President of Belarus Alexander Lukashenko on January 15, 2008. Belarus intends to build a nuclear power plant with the productive capacity of 2 thousand megawatt with the first block being put into operation in 2016 and the second one in 2018.

    Chairman of the Board of the National Academy of Sciences of Belarus (NASB) Mikhail Myasnikovich specified two variants for choosing the general contractor for building the nuclear power plant: holding a tender or making the choice via direct negotiations. The second variant will require serious reasons, stressed Mikhail Myasnikovich. The reliability of the project (it is of utmost importance) as well as co-financing of the project, participation of Belarusian construction companies, service companies and industrial enterprises will be taken into account.

    According to the experts, the construction of the nuclear power plant in Belarus will result in saving about $1 billion a year. Such estimates are based on the expected natural gas prices for Belarus in the future. At present, four major advantages of the construction of the nuclear power plant in Belarus have been voiced. The construction of the nuclear power plant will reduce energy production cost as well as save on the purchase of 3-3.5 billion cubic meters of natural gas a year and reduce the emission of greenhouse gases by 10-12 million tonnes a year. After the first block is launched in 2016, the electricity production cost will drop 60-70%. The nuclear power station will use uranium as raw material. By 2020, the gas prices are expected to be 12 times higher than nuclear fuel prices.

    According to Deputy Energy Minister Mikhail Mikhadyuk, the fuel cost accounts for 70-80% of the thermal and electric energy production cost at the stations that use organic fuels, while this figure is only 20% at the nuclear power plants. Here natural uranium will account for only 8% of the production cost, the rest being spent on its processing, enrichment and waste disposal. Therefore rising gas prices will have a greater impact on electricity cost than rising uranium prices.

    The exact cost of the project to construct the nuclear power plant in Belarus has not been specified yet. It will be negotiated with the organization in charge of the project. The global average of the construction of two blocks of a nuclear power plant varies from $2 billion to $10 billion.

    According to the Institute of Sociology of the National Academy of Sciences of Belarus, the opinion survey carried out in Belarus reveals that the number of people supporting the development of nuclear energy in Belarus has risen almost twice since 2005 – from 28.3% to 54.8%.

  • From the International Press...

    Belarus wants $5B loan from US

    From: AP
    Belarus' authoritarian president, whom the United States has called "Europe's last dictator," is asking the U.S. for a $5 billion loan.

    But Alexander Lukashenko is telling Belarusian TV he isn't hopeful the cash-strapped ex-Soviet republic will get the money.

    He also says in the interview, broadcast Friday, that he's confident the International Monetary Fund will grant Belarus a $2 billion loan.

    The country also announced recently a $2 billion loan from Russia to help stabilize its, Soviet-style economy. The government has spent its gold reserves in a furious effort to support the Belarusian ruble.

    The United States and European Union have criticized Lukashenko for his 14-year iron-fisted rule of Belarus.

    Belarus backs Russia's missile plan to counter U.S. shield

    From: Ria Novosti
    The Belarusian president said on Friday he fully supported Russia's idea to deploy short-range missiles in its Kaliningrad exclave in response to a U.S. missile shield in Central Europe.

    Russian President Dmitry Medvedev threatened in November to deploy Iskander-M short-range missiles in the country's westernmost region, which borders NATO members Poland and Lithuania, if the U.S. missile defense system was deployed in Central Europe.

    "I absolutely support this statement by Medvedev. He simply warns the Americans that there is a response - a low-cost response - to the deployment of a missile-defense system. And he warns all the Europeans who are now ready to station these systems on their soil," Alexander Lukashenko said.

    He said on Thursday that Belarus had no plans to respond to U.S. plans to deploy a missile defense system in Central Europe.

    "Belarus is not yet going to react to missile defense deployment in Europe. First of all, there is no missile defense in Europe, and second, it is big money we don't have yet," Lukashenko said.

    However, he added that if necessary, the country would find the money to respond.

    Lukashenko arrived in Moscow on Friday ahead of talks on Monday with Medvedev to discuss Russian gas prices in 2009.

    Over the weekend, Lukashenko will play in a match between a team of world stars and officials from Russia's gas monopoly Gazprom, the Belarusian president's press office said, without saying which team the president, an avid ice hockey fan, would play for.

    Belarus has joined Russia in condemning U.S. plans to set up an interceptor missile base in Poland and a tracking radar in the Czech Republic, saying the missile shield would destroy the strategic balance of forces and threaten national security.

    The United States says the system is needed to protect against attacks from "rogue" states such as Iran.

    Lukashenka: Gas price of $200 for 1000 cubic meters not acceptable for Belarus

    From: Navany
    A gas price of $200 and more for 1000 cubic meters is not acceptable for Belarus, Alyaksandr Lukashenka said in Thursday's interview with the heads of the three national television networks, the largest government-controlled newspaper Sovetskaya Belorussiya, and government news agency BelTA.

    Mr. Lukashenka acknowledged that he had repeatedly discussed next year’s gas price with Russian President Dmitry Medvedev. “Of course, we will discuss this issue on [December] 22,” he said, referring to a coming meeting with the Russian counterpart in Moscow.

    Commenting on speculation that the Gazprom gas giant may raise the price for Belarus to $240 for 1000 cubic meters, Mr. Lukashenka noted that the rate would be close to the price set for German consumers.

    “And on the whole, how will it look like against the backdrop of a threefold drop in oil prices, which means that the gas price also should decrease. I have told Dmitry Anatolyevich [Medvedev] that we cannot accept the price that Gazprom offers us. The Belarusians will not understand this. With prices falling in the world, we will see a double rise in the price, from $130 to $240 or $200,” Mr. Lukashenka said.

    He noted that Russia “understands this and we have agreed to postpone the discussion of the issue and see how the situation develops in the market.”

    “Thank God, the [oil] price has fallen even lower since it was $60-$70 [per barrel], it is now $40. That’s why we will tell the Russian Federation to look at the situation and understand that we, what matters most, will simply not be able to pay with demand for our goods falling and revenues from our economy dropping. If Russia needs this debt pit that we can get into, then it’s a different thing,” he said.

    Mr. Lukashenka stressed that he did not want Russia to solve its problems at the expense of Belarus.

    “On the contrary, we are expecting Russia to help Belarus in this situation. And this will not be for nothing. We will work it off. We have never owed anyone,” he stressed.

    “This is not an easy period, not easy talks but I’m sure that we will reach agreement,” Mr. Lukashenka added.
    While talking to reporters in Minsk on December 11, Deputy Economy Minister Uladzimir Adashkevich said that Belarus hoped to buy natural gas from Russia at no more than $160 per 1000 cubic meters in 2009.

    "We're proposing this price to the Russian side based on calculations and the dependence of the gas price on the price of oil," Mr. Adashkevich said. "We also expect the price to be $140 per 1000 cubic meters."
    The gas price for Belarus rose to $119 per 1000 cubic meters on January 1, 2008 and increased to $128 on April 1.

    Under a five-year contract signed with Russia’s state natural gas monopolist, Gazprom, on December 31, 2006, the price for Belarus was raised to $100 per 1000 cubic meters for 2007 compared with $46.68 in the previous two and a half years. The price is to gradually increase to the European market level by 2011. It was to be 67 percent of the level, excluding delivery costs, in 2008, 80 percent in 2009, 90 percent in 2010, and 100 percent in 2011.

    Belarusian leadership allows registration of opposition alliance

    From: Earth Times
    The Justice Ministry of Belarus has after four requests For Freedom democracy movement of the opposition leader Alexander Milinkevich to register as a political party, a spokesman for Milinkevich said Wednesday, according to the Itar-Tass news agency. The founding of the movement however has not been without controversy, as it is seen by critics as splitting the opposition against authoritarian President Alexander Lukashenko.

    EU foriegn policy head Javier Solana welcome the decision, saying that the observation of rights played an important role in the dialogue between the European Union and Belarus, the Interfax news agency reported.

    The EU froze relations with Belarus in 2004 in reaction to human rights situation in the country.

  • From the Opposition...

    BPF party activist detained, all information materials seized

    From: Viasna
    On December 16 an activist of the Belarusian Popular Front Party Yauhen Soshka who planned to hand out the special edition of the bulletin of the regional party organization was detained in Brest.

    The incident took place at 7 p.m. in Maladahvardzejskaya Street. Policemen looked through his documents, found bulletins and detained the activist, BelaPAN was informed by a human rights activist Raman Kislyak.

    Y. Soshka was taken to the police department of Maskouski district. He was asked for explanations there. All copies of the bulletin were seized, and at 9.30 p.m. he was released without a report being drawn up.

    The bulletin Soshka was going to hand out covered the expulsion of “For Freedom” movement activist Zhana Abramava from her apartment without another accommodation being given to her. In particular, photos of Zhana Abramava, her mother and six-year-old sister were published in the edition (they were evicted from the apartment as well); the history of the conflict; quotations from the court decision of the court of Maskouski district of Brest which on November 25 fulfilled the demand of Brest Housing, Repair and Maintenance Department on eviction of Zhana Abramava from apartment without offering her other accommodation.

    Zmitser Shymanski, chairman of Brest regional branch of the Belarusian Popular Front, says their aim is to help the activist, to attract attention of the community, of national and international structures to her problem; to initiate addresses of citizens, public associations, well-known politicians and workers of culture with a demand to discharge the court order.

    On December 2 a protest against eviction of the opposition activist took place on the central square of Brest.

    Milinkevich ready to cooperate with authorities

    From: Charter '97
    Alyaksandr Milinkevich thinks the democratic opposition may start cooperation with the Belarusian authorities under new conditions for the sake of independence of Belarus.

    He said it in Bialystok during a meeting with students of Kastus Kalinouski education programme, Radio Racyja reports.

    The meeting of Alyaksandr Milinkevich, leader of the recently registered “For Freedom” movement, with students was held in Bialystok University. For two hours, He was talking about the new political situation in Belarus and answered questions. According to Milinkevich, the Belarusian authorities are urgently looking for a way out of the difficult situation and even began a dialog with Europe:

    – In the current situation, the Belarusian authorities must look for some way out urgently. Otherwise it will die, and Belarus may die too, because this economic policy has been conducted in the country for so many years.

    Alyaksandr Milinkevich explained he had never supported the approach the worse the situation in the country, the better for the opposition. In his view, the regime may soon fall down without foreign support amid the global crisis. But it may be so that Belarus will fall down to the hole together with the authorities that mustn’t be allowed. Milinkevich suggests the authorities to cooperate for the sake of independence of Belarus:

    – I think the authorities are interested in what they are doing now. They have understood if they don’t take these actions, it means death for them. Alyaksandr Lukashenka understands he will be retired at least if we unite with Russia. They are motivated for reforming. To be frank, they conduct these reforms to strengthen their positions in power. We are interested in this for another reason. But both they and we are interested in preserving of sovereignty of Belarus. We can cooperate with them here. We shouldn’t be afraid of this word, this cooperation is not for the sake of dictatorial authorities. This cooperation is needed for Belarus not to kneel.

    Milinkevich it is a godsend that Belarus has an opportunity to join the Eastern Partnership project because it gives an opportunity to integrate in Europe.

  • Around the region...

    NATO resumes diplomatic contacts with Russia

    From: AP
    NATO and Russia will resume diplomatic contacts for the first time since the war in Georgia, the alliance's spokesman said Thursday.

    Spokesman James Appathurai said NATO's secretary-general and Russia's ambassador to the Western alliance will meet informally Friday — the first such meeting since NATO froze diplomatic contacts in the wake of Moscow's invasion of Georgia in August.

    Russian Ambassador Dmitry Rogozin has said previously he would welcome the resumption of ties, but his mission played down expectations for the meeting with Secretary General Jaap de Hoop Scheffer.

    "We don't expect anything specific ... but it is a step in unfreezing our relations," said Igor Semenenko, a senior Russian diplomat in Brussels.

    Despite the diplomatic freeze, NATO and Russia have continued to cooperate on issues of common interest, such as combating piracy off the Somali coast.

    Moscow also has agreed to allow the alliance to use its territory to resupply Western forces in Afghanistan. Attacks on transport convoys in Pakistan by pro-Taliban forces have raised concerns about the security of NATO's main overland logistics route.

    NATO foreign ministers agreed two weeks ago to gradually resume contacts with Moscow, starting with informal meetings at a relatively low level, such as Friday's meeting in which Russia is represented only by its ambassador.

    They held off on resuming higher level talks, such as the meetings of Russian foreign and defense ministers with NATO counterparts that were held regularly every few months before the split over Georgia.

    The decision was a compromise between nations led by Germany who had sought a rapid return to normal relations and the United States, backed by some eastern European NATO members, who were concerned a softer line might encourage Russia to bully its neighbors.

    NATO ministers remain critical of Moscow and say the resumption of talks would not mean a return to business as usual for the NATO-Russia Council — a consultative panel set up in 2002 to improve relations between the former Cold War foes.

    Ukraine’s Hryvnia Jumps 11% as Central Bank Raises Rate to 22%

    From: Bloomburg
    Ukraine’s currency jumped as much as 11 percent against the dollar after the second interest-rate increase in two days aimed at halting a plunge the government says would cause defaults on most foreign-currency loans.

    The hryvnia climbed the most in seven weeks to as high as 8.0925 per dollar, and was at 8.2750 as of 7:06 p.m. in Kiev, from 9.1 yesterday. The increase came after a 14 percent slide in the previous two days. The central bank raised its benchmark refinancing rate to 22 percent from 18 percent, after increasing it one percentage point yesterday.

    Ukraine’s currency fell 45 percent against the dollar since July 1, prompting a warning from an aide of President Viktor Yushchenko this week that 60 percent of foreign-currency loans and mortgages may go into default because of the higher repayment costs. The ex-Soviet nation’s ability to stem the decline is limited by an agreement for a $16.4 billion International Monetary Fund bailout that prohibits reserves from falling more than 4 percent by year-end from $32.8 billion.

    “The rate move today will only provide short-term relief,” said Nigel Rendell, an emerging-markets strategist at RBC Capital Markets in London. “Interest rates don’t fix macro- economic problems, they only put sticking plaster over them.”

    The currency may weaken another 24 percent, according to Commerzbank AG. At the start of the year, the dollar bought 5.05 hryvnia.

    “The central bank has limited ammunition and ability and willingness to support the currency,” said Michael Ganske, head of emerging markets in London for Commerzbank, Germany’s second- biggest bank.


    President Viktor Yushchenko threatened to fire central bank employees this week and Prime Minister Yulia Timoshenko demanded National Bank of Ukraine Governor Volodymyr Stelmakh’s dismissal. The central bank responded by saying Timoshenko is causing “chaos” and undermining the nation’s banking system, according to a statement today on its Web site.

    The country’s ruling coalition collapsed in September amid disagreement between Yushchenko and Timoshenko, before forming again this month.

    “Policy clarity is required urgently in Ukraine, not only to stem the fall of the hryvnia, but also to bring some credibility to the pursuit of the IMF program,” Ali Al-Eyd, an economist in London at Citigroup Inc., said in a research note today. “In a worst case scenario, IMF program targets could become too politically difficult to achieve”.

    Interest Rates

    The central bank agreed with Yushchenko yesterday to sell dollars every day to banks to prop up the hryvnia and revoke licenses of those found speculating against the currency. The Ukrainian parliament will debate the role of the central bank next week, it said today.

    “I wouldn’t like to be in the shoes of the central bankers right now,” said Alexander Morozov, chief economist in Moscow for HSBC Holdings Plc, Europe’s biggest bank. “There’s not much of a way out.”

    Ukraine’s benchmark PFTS stock index dropped 74 percent this year, the third-steepest retreat among 22 so-called frontier markets tracked by MSCI Inc. Mariupolsky Metallurgical Plant, Ukraine’s largest steel company by revenue, slid 92 percent in trading in Kiev.

    The extra yield investors demand to own Ukrainian government bonds instead of U.S. Treasuries increased more than nine times this year to 25.95 percentage points, according to JPMorgan Chase & Co.’s EMBI+ indexes. That compares with an almost three-fold increase in the main emerging-market index to 7.1 percentage points.

    Loan Defaults

    Yushchenko’s economic aide Roman Zhukovskyi said this week that 60 percent of foreign-currency loans and mortgages may go into default because of the decline.

    Ukraine, with $105 billion of corporate and state debt, has the fourth-highest credit risk worldwide, credit-default swaps show. The cost to safeguard Ukraine’s bonds against default jumped more than 13 times this year to about 30 percent of the amount of debt protected, behind Ecuador, which defaulted last week, at 59 percent, Argentina, which reneged on $95 billion of bonds in 2001, at 46 percent, and Venezuala at 33 percent, CMA Datavision figures on Bloomberg show.

    Credit-default swaps, contracts conceived to protect bondholders against default, pay the buyer face value in exchange for the underlying securities or the cash equivalent should a company fail to adhere to its debt agreements.

    Shrinking Production

    Ukrainian companies need to repay as much as $4.1 billion this month as lenders refuse to refinance the debt amid the worst global financial crisis since the Great Depression, according to Dmitry Gourov, an economist focusing on Ukraine at UniCredit SpA in Vienna. Dollar loans made up 53 percent of credit issued by Ukrainian lenders as of Sept. 30, the central bank Web site says.

    The economy, which relies on steel for 40 percent of exports, is weakening after production dropped 48.8 percent in November and prices tumbled. European hot rolled coil, the benchmark steel product, fell 47 percent since August to $425 a metric ton, according to data from U.K. industry publication Metal Bulletin.

    The economy, which has expanded at an average annual rate of 7 percent since 2000, may shrink 5 percent next year, Oleksandr Shlapak, the president’s deputy chief of staff, said last month.

    Economies throughout the former Soviet Union are being battered by falling demand for their exports, driving down currencies. Belarus may devalue its currency by 10 percent as it seeks to secure a $2 billion IMF bailout, Alexander Lukashenko said in an interview with Belarus Today. The government banned Belarusian companies from making payments in foreign exchange for imported goods in advance, to limit outflows.

    IMF Program

    Ukrainian Industrial production shrank by a record 28.6 percent in November as steel, machine building and oil refining slumped, after a 19.8 percent decline in October, the statistics office said last week.

    “This has to be stabilized now, and the only way to stabilize the situation is probably by tweaking the IMF program with more money and changing the conditions to reflect these new more difficult realities,” said Simon Johnson, a senior fellow at the Peterson Institute for International Economics in Washington and former chief economist of the IMF.

    The IMF allocated $4.5 billion to support the country’s banks, increase deposit insurance and boost funding for unemployment benefits, according to the last statement on the fund’s Web site, dated Nov. 5. Before the IMF deal, Natsionalnyi Bank Ukrainy drained $3.4 billion in November and $4.1 billion the previous month to manage the currency’s decline.

    ‘Stricter Policy’

    The IMF “doesn’t want to see its money wasted on defending a currency level that isn’t sustainable,” said Nick Chamie, head of emerging-markets research at RBC Capital Markets in Toronto.

    Balazs Horvath, the IMF representative in Kiev, said in an interview yesterday the government needs to stick to the agreement “to keep the exchange rate from collapsing.”

    The central bank will sell U.S. currency at a rate of 8.7 hryvnia per dollar today, 4.5 percent below the market exchange rate, Finance Minister Viktor Pynzenyk said in televised remarks yesterday. Central banks intervene when they buy or sell currencies to influence exchange rates.

    “We will have a stricter monetary policy,” Stelmakh, the central bank governor, said yesterday.

    The central bank is calling for a law to force exporters to convert part of their revenue into hryvnia and a ban on household loans in foreign currencies, Petro Poroshenko, head of the central bank’s council, said late yesterday in Kiev.

    Reluctant Sellers

    “The central bank has asked exporters to sell their dollars, but in this situation exporters are reluctant to convert because they see a further dip,” said Mandar Jayawant, a managing partner at Singapore-based Frontier Investment & Development Partners, which manages private-equity funds in frontier markets and doesn’t have investments in Ukraine.

    “The sovereign is in a position where it shouldn’t necessarily default on its debt,” Kevin Daly, who manages about $4 billion in emerging-market bonds at Aberdeen Asset Management in London, said in an interview on Bloomberg Television yesterday. “It clearly looks like it will continue to devalue.”

  • From the Polish Scandal Files...

    Another arrest in Poland’s football corruption scandal

    From: Polish Soca
    Member of the Board of the Polish Football Association (PZPN) Henryk K., dubbed the “Prince of the North”, was arrested in Gdansk, northern Poland, Thursday.

    Mafia involvement
    He is suspected of taking bribes and fixing matches in the Polish football league. Henryk K. is to hear charges, Friday. He was incriminated by the testimony of Ryszard F., aka “Fryzjer” [Barber], part of what police believe to be mafia involvement in widespread corruption thorough out many levels of the game. The former head of the Polish football mafia has admitted that he gave an envelope full of money to Henryk K. for fixing the result of a game. “I am surprised. Only yesterday we had a Christmas meeting in the Association, and today I’ve learned that a member of the Board was arrested,” said the new head of PZPN Grzegorz Lato after the arrest. “Let the prosecutors do their job, we will do ours,” he added.

    Corruption trial
    The investigation on corruption in Polish football has been underway since May 2005. So far the public prosecutor’s office has leveled charges against some 170 people: sports activists, referees, PZPN observers and two members of the Board of the Association: Wit Z. and Kazimierz F. The first corruption trail started in a court in Wroclaw, western Poland last December. In the dock were 17 people, among others Ryszard F., who is an alleged organiser of match fixing.

    The continuing story of corruption in the Polish FA

    From: Polskie Radio
    A member of PZPN, the Polish FA, has had seven counts of corruption brought against him.

    Henryk Klocek is pleading not guilty to five cases of accepting bribes, and two cases of their actual transactions.

    In a court hearing that lasted seven hours, the prosecution brought the cases forward following reports of match fixing in the 2003-2004 season, with an estimated 50,000 zloty (15,000 euro) being transferred for rigging matches in both the first and second divisions.

    Mr. Klocek is on bail for 70,000 zloty, and the prosecution has failed to state whether he the allegedly corrupt PZPN official had previous contacts with 'The Hairdresser', head of the football mafia in Poland.

    Author convicted of murder after including details in thriller

    From: Telegraph
    A best-selling Polish author has been jailed for 25 years for murdering a man he suspected of having an affair with his wife and then describing it in chilling detail in a thriller.

    Polish crime-novelist and philosopher Krystian Bala, 33, was convicted at retrial in Wroclaw, south west Poland.

    The court ruled he was guilty of organising the murder of Dariusz Janiszewski because he suspected he had become his wife's lover.

    Eight years ago, fishermen found the corpse of Janiszewski, who owned a small advertising agency, on the banks of the River Oder, near the Polish city of Wroclaw.

    In December 2000, the young advertising executive was fished out of the river Oder, bearing signs of torture. He had been thrown into the river alive, trussed up with a noose round his neck.

    For years the murder had police in Wroclaw flummoxed. They had no suspect and no motive.

    But five years later, police received an anonymous call in which they were told to take a look at the book Amok, published in 2003, three years after the killing. Officers were shocked to find the book contained intimate details of the murder that could be known only to police – or the killer.

    The plot centred on a group of intellectuals experimenting with sex and drugs and contained an account of a murder, remarkably similar to that of Mr Janiszewski

    Further investigations revealed that the victim was an acquaintance of Mr Bala's estranged wife.

    Police then discovered Bala had phoned Janiszewski the very day he disappeared. They discovered that, four days after the murder, Bala had also sold the young advertising executive's mobile phone on an internet auction.

    Mr Bala told police he had collated details of the killing from press reports and imagined the missing parts.

    Poland’s former communist leaders face pensions cut

    From: Peninsula
    Poland took a step towards slashing pensions for the country’s communist-era leaders after deputies in the lower parliamentary approved the measure in a vote yesterday. The bill, if it becomes law, would affect former president General Wojciech Jaruzelsk, currently on trial for the 1981 crackdown against the anti-communist Solidarity trades union movement, and many communist-era officials.

    Since the senate, like the lower house, is dominated by liberal deputies, the bill is almost certain to be approved there before receiving the approval of Poland’s conservative President Lech Kaczynski. The bill covers all members of the communist party’s 1981 Military Council for Salvation of the Nation (WRON), set up by General Jaruzelski in December that year as part of a martial law crackdown on Solidarity. It also reduces pension benefits for agents of the communist regime’s infamous secret police who worked between 1944-1990. The bill addressed “an elementary feeling of justice” Liberal Prime Minister Donald Tusk said after the vote.

    “We’re returning normality to this domain,” he argued. “No one will have a higher pension (than others) due to the fact they worked for the communist secret police, but at the same time no one will be deprived of the means to survive,” he said.

    The changes would revise downwards the generous indexation of pension benefits for former communist regime leaders and agents. It passed with 366 votes for, 50 against and 22 abstentions.

    Poland’s communist-era generals and secret policemen would see their monthly pensions, which are now worth 8,000 zlotys (¤2,422, $2,750) fall to 2,500 zlotys (¤757, $860 dollars), according to Polish media reports. That would still leave them substantially higher than the average Polish monthly pension of 1,300 zlotys (¤300, $416). General Jaruzelski, 85, is already dealing with another challenge to his conduct during his time in power.

    He and several other former senior communist party figures are on trial on charges of “communist crimes” for their imposition of martial law in Poland in 1981 in the move against Solidarity.

    Jaruzelski, who has denied the charges, has long argued martial law was justified as “the lesser evil” preventing a civil war or an outright Soviet invasion in reaction to Solidarity’s growing strength.

  • Sport...

    Belarusian Football Federation declares Valery Shantolosov persona non grata

    From: BelTA
    The Belarusian Football Federation has declared Valery Shantolosov, former member of the national football team of the Republic of Belarus, a persona non grata, BelTA learnt from the press service of the federation.

    A disciplinary committee of the Belarusian Football Federation held a session on December 19 to consider the results of the investigation into Vitaly Shantolosov’s case by the law-enforcement agencies of Belarus and Russia.

    The disciplinary committee took a decision to declare Vitaly Shantolosov a persona non grata for the unsportsmanlike attempts to fix the matches of the national football team of Belarus during the Euro 2004 qualifying tournament against the team of the Czech Republic on September 6, 2003 and against the team of Moldova on September 10, 2003.

    Following the Disciplinary Code the Belarusian Football Federation took a decision to inform the members of the federation, referees and other people who are engaged professionally in football to restrain from any contacts with Valery Shantolosov in their professional activity.

    A decision was taken to petition the FIFA to extend the disciplinary punishment

    Belarus ice hockey team wins Polessye Cup

    The national team of Belarus has won the third international ice hockey tournament Polessye Cup on December 20, BelTA has learnt.

    The hosts of the tournament defeated the Ukrainian team with the score 7-2 at the Gomel Ice Arena.

    The team of Eduard Zankovets was leading during the whole game. Two pucks were delivered by Dmitry Dudik of the winning team.

  • Cultural scene...

    Спектакль “Пить, петь, плакать”

    26 декабря в 19.00
    на сцене малого зала КЗ “Минск”

    новый спектакль режиссера самой успешной постановки последних лет “Двенадцатая ночь”

    Кати Огородниковой


    «Получилась комедия в стиле джаз, реальная до абсурда»
    («Комсомольская правда в Беларуси»).

    “Я считаю, что это лучший спектакль сезона в Минске. Лучший в своем жанре романтического фарса. Самый удивительный по исполнению. И неожиданно волшебный по содержанию”.
    (Алексей Стрельников, театральный критик).

    О чеховских дачных вечерах с чаепитиями на террасе, о бунинских яблоках, уже в августе пахнущих елкой, о любви, немножко о нелюбви и чуть-чуть о смерти, о мальчиках и девочках, о сочинителях и переводчиках, о мужьях, жёнах и нежёнах, о казенных столах и хмурых капитанах, о котах и людях – обо всем, от чего так хочется пить петь и плакать, новый спектакль известного белорусского режиссера Кати Огородниковой по пьесе российского драматурга Ксении Драгунской.

    Пьют, поют и плачут, разыгрывают перед зрителем “глупые истории про нас с тобой” заслуженная артистка Республики Беларусь и Автономной Республики Крым Зоя Белохвостик, артисты Светлана Аникей, Сергей Белякович, Валентина Гацуева, Михаил Есьман, Сергей Тарасюк, Дмитрий Семенов, Павел Яскевич.

    Автор – Ксения Драгунская
    Режиссер – Катя Огородникова
    Художник – Владимир Зленко

    Продолжительность спектакля – 1 час 40 минут

    Справки по телефону +375 29 641 66 12

  • Endnote...

    Belarusian Greens urge EU to place environmental matters on agenda of talks with Minsk

    From: Navany
    The Belarusian Party of Greens has urged the European Union to place environmental matters on the agenda of its talks with Minsk.

    The party says that the Belarusian authorities do not honor commitments under the Aarhus Convention on access to information, public participation in decision-making and access to justice in environmental matters, which Belarus ratified in 2001.

    "Belarus has not implemented mechanisms set forth in the convention," Aleh Novikaw, leader of the party, told BelaPAN.

    "Public environmental control is in fact prohibited in the country. The public does not have access to control in natural reserves and national parks run by the president's management property department. Consultations on the construction of environmentally hazardous facilities are conducted in such a manner that a negative opinion is no reason for the cancellation of the project even when it is voiced by an overwhelming majority of public representatives. A developer only needs to draw up a minutes of a public consultation and give well-grounded denials to all proposals, which turns the procedure into a farce."

    Mr. Novikaw said that the convention was violated in Belarus on a regular basis, mentioning plans to build a pesticide plant project near Druzhny, Minsk district, and the "government-set format of discussion" about the construction of a nuclear power plant, which he noted does not include either independent researchers, or environmental activists, or people residing in areas where the plant could be built.

    "Until people have an opportunity to exercise the right to participate in environmental matters, Belarus cannot be seen as a country that has embarked on a democratic path," Mr. Novikaw said.