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WEEKLY DIGEST
OF BELARUSIAN NEWS
September 2, 2005
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NATIONAL NEWS
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The President of Belarus Approves Energy
Safety Concept
The President of Belarus approved the energy safety concept and the state
program on modernization of key state-controlled assets of the Belarusian
energy system for 2006-2010.
The Concept sets a task to bring the share of local fuels up by 25 percent
of all power generated in the country.
The program enumerates facilities, conditions of upgrade, sources of
investments, and aims to reduce Belarus’ energy consumption by 25 percent on
2005 by 2010, renovate of the key assets, save fuel and raise production of
local energy resources.
The President of Belarus Signed Ordinance to
Raise Retirement Payments from September 1
The President of Belarus signed ordinance to increase retirement payments
from September 1, 2005.
According to the document, retirement payments are to recalculate on the
average salary basis. The average retirement payments starting September 1
is to by 11 percent.
Retirement payments were last increased by 8 percent on the average on April
1, 2005.
The President of Belarus Introduces Measures
to Reduce Cost of New Houses in Rural Area
The President' Ordinance introduced a number of measures to reduce the cost
of new houses in a rural area. The document envisages 5 percent limit for
construction profitability and production of building materials for village
housing construction. The Ordinance also gives further opportunities for
loans coverage.
The dwelling market output in Belarus is expected at 3.5-4 million square
meters in 2005, of them 30 percent in a rural area.
Belarus Already Harvests More Than 6.2
Million Tons of Grain
Belarus’ state farms had harvested 6.213 million tons of grain from 96
percent of the total cultivated area, including 306,600 tons of malt barley.
The average yield of grain currently stands at 3.19 tons per hectare.
State farms also harvested 167,100 tons of winter coleseed from 75.9 percent
of the area with the yield at 1.74 tons per hectare. Besides, 16.700 tons of
linseed was harvested from 89.7 percent of the area.
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INTERNATIONAL COOPERATION
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Commonwealth of Independent States
Meeting Held in the City of Kazan, Russia
The Commonwealth of Independence States' reform was brought
to the spotlight at the CIS summit held on September 26, in the city of
Kazan, the capital of Tatarstan, Russia.
The heads of the states approved the statement on the UN 60th anniversary
and the address on the 20th anniversary of the Chernobyl disaster. Some
documents, such as concept of coordinated border policy, concept of
cooperation in fight against terrorism and agreement on humanitarian
cooperation were signed.
The CIS leaders also adopted the resolution proclaiming the year 2006 a Year
of the Commonwealth of Independent States and approved the program on
cooperation in struggling against illegal migration for 2006-2008, as well
as the program on cooperation in struggling against terrorism for 2005-2007.
The next summit of the CIS is to take place in the capital of Belarus, Minsk
in 2006.
CIS Adopts "Wise Men Group" to Seek New
Integration Model
President of Russia Vladimir Putin announced at the CIS
summit in Kazan that the CIS leaders decided to use a so-called "wise men
group" pattern to elaborate a new integration model.
"Russia suggested establishing a High Level Group using the model of the UN
Wise Men Group. This group might include authoritative members of the
Commonwealth, not only politicians and officials, but also public figures
that are ready to consider economic and legal issues," President Putin said.
"We will have to elaborate a new integration model, which will meet common
interests and national priorities of the CIS country members", added the
President.
Foreign Minister Sergei Martynov: CIS
Summit Was Fruitful
Belarusian Foreign Minister Sergei Martynov described
decisions taken at the Kazan summit of the Commonwealth of Independent
States as "the first phase of the CIS reform." "The novelty is that all the
rubbish, all the unfeasible decisions should be thrown aside and practical
life should be used as the basis," Sergei Martynov said.
"The fruitfulness of the CIS summit is the best response to speculation by
pessimists who suggest the CIS should be scrapped or disbanded," Foreign
Minister said.
Belarus, Kazakhstan and Russia May
Sign Key Common Economic Area Agreements without Ukraine
The Common Economic Area (CEA) (originally planned as an
economic union of Belarus, Kazakhstan, Russia and Ukraine), or rather three
member countries, Belarus, Kazakhstan and Russia, are to sign 29 key
agreements on the establishment of the CEA by this December without Ukraine,
President of Russia Vladimir Putin told reporters following last Saturday’s
summit of the CEA. President Putin added that another 15 key agreements
could be signed by March 1, 2006 by the three countries, Ukraine being ready
to work in the context of the four CEA members as soon as it is ready.
According to President Putin, each CEA member country may pursue its own
economic integration policy. “We all have to decide whether we will benefit
or not. If there are doubts, one should take more time to weigh pros and
cons; I agree with Ukraine’s President, Viktor Yuschenko here. Otherwise the
CEA may be interpreted as a decision imposed by someone else,” Putin said.
President Yuschenko announced after the summit that Kiev was ready to sign
15 documents out of 29. “We will have to thrash over the other positions,”
he said. As for the second package of 15 documents, which covers the
establishment of the single customs area, Ukraine will study the proposals
and adjust them, President Yuschenko said. This package is to be ready by
March.
President of Kazakhstan Nursultan Nazarbayev said Kazakhstan was ready to
sign all the 93 agreements on the establishment of the CEA.
The President of Belarus said: "Minsk was interested in signing all
agreements more than any other CEA member. We were ready to sign all
agreements two years ago, but now we know what agreements to sign, how many
documents we have and when to sign them".
Foreign Ministers of Belarus and
Russia Deem It Necessary to Intensify Efforts to Further Union State
Construction
In the course of the talks in Moscow September 1 foreign
ministers of Belarus and Russia Sergey Martynov and Sergey Lavrov
respectively stressed the need to intensify the efforts to develop the union
state of Belarus and Russia, establishment of single economic and
humanitarian dimensions, increasing trade cooperation, ensuring equal rights
of the countries’ citizens.
The ministers exchanged opinions on topical issues of Belarus-Russia
relations. The sides considered the prospects of enhancing the coordination
of actions on the international arena and in security field.
Council of Ministers of the Union
State of Belarus and Russia to be held in Minsk
The council of Ministers of the Union State of Belarus and
Russia is to be held in Minsk on September 6, 2005.
About 24 issues are on the agenda, including the implementation of 2005
Union State budget, some joint programs including the coordinated foreign
policy program for 2004-2005, program on development of diesel motor
production, as well as the information security program, etc.
Russia Will Present Its Export
Potential in Belarus on September 6-9, 2005
The national exhibition of Russia is expected to be held in
Belarus’ capital city Minsk simultaneously with the economic forum on
September 6-9, 2005.
The forum is held as a part of the year of Russian culture in Belarus. Prime
Ministers of Russia and Belarus Mikhail Fradkov and Sergei Sidorsky are
expected to open the forum and to visit the exhibition.
Also, Mayor of Moscow Yury Luzhkov is to attend the forum, as well as
governors of Russian regions and other authority representatives of the two
countries.
The exhibition will include expositions of the city of Moscow, Kirov, Kursk,
Omsk, Saratov, Smolensk, Sverdlovsk, Ulyanovsk, Nizhni Novgorod and
Chelyabinsk Regions, as well as Mordovia, Stavropol Territory, Chuvashia and
some other Russian regions.
Russian delegations are to visit Minsk Tractor Plant, BelAZ mine truck
producer, Horizont television producer and Svitanak knitting factory.
Belarus and India Signed Memorandum on
Understanding and Cooperation
The memorandum on understanding and cooperation was signed on
August 26 by Belarusian Chamber of Commerce and Industry and Confederation
of Indian Industry in the framework of the exhibition of Indian companies
hosted by BelExpo, exhibition centre in Minsk.
The document will promote information exchange on economic and trade issues,
as well as favorable conditions to boost mutual trade and investments and
will intensify contacts between business circles of the two countries.
As Charge d’Affaires ad interim of India to Belarus Raghunath Mishra stated
at the opening ceremony, India attaches great importance to the development
of friendship and cooperation with Belarus. According to the diplomat, India
deems it necessary to develop long-term bilateral trade-economic relations
with Belarus.
Belarus and Armenia Signed Protocol to
Improve Bilateral Trade
The Government of Belarus approved intergovernmental protocol
with Armenia on abolishment of reserves for sugar and alcohol from the free
trade regime, signed by Prime Ministers Sergei Sidorsky and Andranik
Margaryan on May, 2005.
Since 2000 Belarus and Armenia have used free trade regime in bilateral
trade. In 2002 the parties signed the protocol on reserves for some
commodities from the free trade regime.
Belarusian export to Armenia rose up to 57 percent on the year January-June,
while imports from Armenia reduced to 25.1 percent.
Belarus Expects Closer Cooperation
with WTO
Belarus expects to step up cooperation with the World Trade
Organization (WTO) in order to accelerate the country’s accession to the
organization after Pascal Lamy assumes office as a new WTO Director General,
Foreign Minister Sergei Martynov said in a letter addressed to Pascal Lamy.
"We hope that the new Director General will contribute to the process of
Belarus’s WTO accession", the Foreign Minister said, and added: "Belarus is
ready to work more efficiently and expressed hope for further effective
cooperation with the new WTO authorities".
According to experts, Belarus may join the WTO in late 2006 or early 2007.
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BUSINESS AND ECONOMY
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Foreign Trade Rises Slower but Feels
More Confident
The favorable situation on foreign markets and new VAT
collection rules in trade with Russia from January 1, 2005 allowed Belarus
to reach a trade surplus of $264.4 million as of August 1, with energy trade
surplus standing at $92.7 million, an interesting phenomenon for the
energy-dependent country.
In 2003 energy imports exceeded exports by $928.1 million and in the first
half of 2004 imports exceeded exports by $425.5 million. Energy trade
deficit was at $873.5 million as of January 1, 2005.
Belarus’ commodity trade surplus reached in January-July $264.4 million. In
2004 commodity trade deficit amounted to $2.594 billion, while service trade
surplus was at $743.9 million.
Belarus’ gross domestic product (GDP) grew by 8.8 percent on the year in
January-July 2005, down from 10.2 percent in the period in 2004. Industrial
output in January-July 2005 rose by 9.6 percent on the year compared with an
increase of 15.3 percent last year, capital investments rose by 19.2 percent
against 21.8 percent and consumer goods output went up 10.2 percent against
13.7 percent.
On the other hand, in the period, agriculture output increased 11.6 percent
against 3.2 percent and retail turnover hiked by 18.1 percent compared with
10.2 percent, which means Belarusians’ incomes are rising in real terms.
The real income of the population (calculated one month later than other
parameters) rose by 15.8 percent in real terms in January-June, and salaries
in real terms increased by 22.6 percent.
The number of officially registered jobless people kept falling in
January-July to 73,100 as of August 1, 2005, or 1.7 percent of Belarus’
workforce.
Inflation was record low, with consumer price index (CPI) going up only 0.9
percent on the month in July and 4.8 percent in the first half year,
compared with a 9.1 percent rise in January-July 2004. In January-July,
producer price index (PPI) increased 6.3 percent. Construction and assembly
prices rose by the most, 9.2 percent in the period.
Belarus’ consolidated budget revenues reached 16.9 trillion Belarusian
rubles in January-July ($1 – 2150 Br), or 50.5 percent of GDP, of them VAT
accounted for 18.9 percent, or 9.5 percent of GDP, up from 8.1 percent in
the period last year, profit tax for 7.7 percent of budget revenues and 3.9
percent of GDP, up from 3.6 percent last year.
The successful implementation of state budget revenues was due to a better
financial situation at Belarusian companies and switch to the destination
basis of VAT collection in trade with Russia.
VAT revenues reached 2.286 trillion Belarusian rubles (Br) in January-June,
a rise of 100 percent on the year. VAT on goods from Russia accounted for 40
percent of the total, at 457 billion rubles, the equivalent of $213 million.
At the same time, imports from Russia declined 9.1 percent on the year in
January-June.
Belarus' budget surplus reached 839 billion Belarusian rubles in
January-July. Revenues were at 66 percent of the target for 2005, and
spending at 58 percent. Budget deficit is not to exceed 1.108 trillion
Belarusian rubles in 2005, or 1.7 percent of GDP.
Companies’ financial standing improved in January-June. The rise in
companies’ earnings was at 24.9 percent in the period as of July 1, 2005,
while CPI rose by 11.5 percent.
Sales profit amounted to 4.8 trillion Belarusian rubles, a rise of 29.3
percent in real terms in the first five months, and net profit reached 3
trillion rubles, an increase of 60 percent.
The profitability of sold goods edged up to 14.4 percent in January-June
2005 from 14.2 percent in the same period last year, and sales profitability
increased to 8.8 percent from 8.5 percent.
The share of loss-makers in the national economy declined to 20 percent of
the total number as of July 1, 2005 from 29.2 percent as of the same date
last year.
Belarus Electric Power Exports up by
7.2 percent
Belarus’ electric power exports rose by 7.2 percent on the
year in January-July to 0.502 billion kilowatt-hours (kWh).
Belarus exports power only to Poland via the 110-kilovolt power line
Beryozovskaya power station-substation Brest-2-Wolka Dobrynska. Exports
started in 2003.
Electric power imports in Belarus increased by 88.5 percent on the year in
January-June to by 2.8 billion kWh. All imports were from Russia. Belarus
produced 16.95 billion kWh of electric power in January-July, 2005.
Belarus' Mineral Fertilizer Output up
by 4.6 percent
Belarus’ output of all mineral fertilizers increased by 4.6
percent on the year in January-July to 3.473 million tons.
The output of potash fertilizers increased by 4.6 percent on the year to
2.967 million tons, nitrogen fertilizers rose by 3.9 percent on the year to
426,000 tons in the period, and the production of phosphate fertilizers rose
by 11.8 percent on the year to 80,500 tons.
Synthetic resin and plastics output rose by 4.1 percent on the year in
January-July to 320,800 tons, chemical fiber and thread production went up
4.2 percent to 130,000 tons and glass fiber plastics output increased 16.9
percent to 866 tons.
The Belarus' chemical and petrochemical industry output increased 5.4
percent on the year in January-July.
The National Bank Raised Its Gold
Reserves up by 23.47 Tons
The National Bank raised precious metals in its reserves to
23.47 tons in gold equivalent as of August 2005.
As of early February 2005 the National Bank had 20.1 tons of precious metals
in gold equivalent, almost flat from October 2004. In late January 2004 the
National Bank had about 15.2 tons of gold in reserves, up from 10.1 tons as
of early 2003.
In January-July 2005 net foreign assets of the National Bank and government,
including precious metals, increased by 57.9 percent to $1.362 billion.
MOGILEVKHIMVOLOKNO Invites
Applications for Shares
Belarus’ artificial fiber producer Mogilevkhimvolokno invites
applications for shares in order to increase its charter capital.
The plant offers 18.7 million common registered shares. The subscription to
shares will close in six months. Mogilevkhimvolokno plans to use these funds
to raise its working assets.
Mogilevkhimvolokno is the largest producer of artificial fibers in Europe.
The plant was created in 1965 and in 2002 transformed into a joint-stock
company. The company employs about 13,000 people.
NAFTAN Refinery Plant Adopts $420-480
million Upgrade Program
Belarus’ oil refinery plant Naftan, based in the Vitebsk
Region, plans to implement a new upgrade program for 2006-2010 worth about
$420-480 million to increase its annual production capacity to 12 million
tons in 2010 from the expected 9.5 million tons in 2005.
The company plans to finance the upgrade from its own funds and $80 million
loans. Currently the company is holding negotiations on a $50 million loan
with a foreign bank.
It is planned to increase crude conversion rate to 90 percent from the
current 71.6 percent as a result of the upgrade. The government is expected
to adopt the upgrade program on September, 2005.
Under the previous upgrade program for 1999-2004 Naftan build a system of
vacuum gas oil hydrocracking units, upgraded the sulfuric acid production
facility and introduced viscosity breaking and thermal cracking of black
oil.
Nuclear Power Station May Insure
Energy Safety
Director General of Belenergo, the state-owned energy
holding, Sergei Bely believes the construction of a nuclear power station
may help ensure energy safety in Belarus. According to his words such
decision should be in line with the International Atomic Energy Agency
requirements.
The energy safety concept for 2006-2010 approved by the President of Belarus
contains provisions on possible construction of a nuclear power station in
the country. But no decisions have been made yet.
Belenergo shares the view that Belarus should postpone the decision-making
until 2008 in the light of Chernobyl disaster of 1986 and temporary
moratorium on nuclear power stations construction.
GAZPROM to Launch Four Compressor
Plants in Belarus
Russia’s natural gas monopoly Gazprom plans to launch four
compressor plants at the Belarusian stretch of the Yamal-Europe gas pipeline
during the period of September 2005 to February 2006.
In 2004 Russian gas transit through Belarus rose by 6.6 percent on the year
to 35.3 billion cubic meters, including 23.5 billion cubic meters
transported via the Yamal-Europe pipeline, up by 7.8 percent on the year.
Under the contract with Belarus, Gazprom is to supply 19.1 billion cubic
meters of gas in 2005 for $46.68 per 1,000 cubic meters. Gazprom may
possibly supply an additional 1.4 billion cubic meters of gas to Belarus
this year.
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CULTURE AND SOCIETY
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Educational System of Belarus Is Ready for
New Academic Year
According to the Ministry of education Belarus is ready for a new academic
year. The work on development and improvement of secondary educational
establishments and on providing them with teaching staff has been finished.
In this academic year the Ministry plans to launch a large-scale project on
restoration and accomplishment by teachers and schoolchildren of monuments
and the other historical places, including those connected with the World
War II. All schools will take part in the project. After their restoration
the places will be marked on maps. Atlases and special guides will be
published in the future.
Belarusian State University is Placed First
at Mathematics Olympiad in Bulgaria
Students of Belarusian State University have beaten rivals from more than 40
universities from 29 countries, including Princeton, Oxford, Manchester,
Bonn and Bremen.
Over two days, over 300 young mathematicians solved 12 tasks within 5 hours.
Nikita Selinger, a forth year student of the Belarusian State University's
Department of Applied Mathematics and Information Technologies was the
absolute winner. His fellow-students Victoria Lebed and Sergey Markovsky
were awarded with the Grand-Prix. All six members of the team came home with
gold medals.
Belarusians Won Gold and Silver at World
Canoe and Kayak Championship
The Belarusian rowers won gold and silver medals at the World Canoe and
Kayak Championship in Croatia. The Belarusian four included Roman
Petrushenko, Alexander Abalmasov, Demiyan Turchin and Vadim Makhnev, who won
a 500-meter race. By the way, two from the crew – Petrushenko and Makhnev –
won bronze at the 2004 Olympic Games in Athens.
The silver medals went to Alexander Kurlyandchik, Alexander Zhukovskiy,
Semyon Saponenko and Alexander Bogdanovich, who came second in 1000-meter
race.
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