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If you find meaningful or important information in a cable, please link directly to its unique reference number. Linking to a specific paragraph in the body of a cable is also possible by copying the appropriate link (to be found at theparagraph symbol).Please mark messages for social networking services like Twitter with the hash tags #cablegate and a hash containing the reference ID e.g. #09MINSK138.
| Reference ID | Created | Released | Classification | Origin |
|---|---|---|---|---|
| 09MINSK138 | 2009-04-29 17:34 | 2011-08-30 01:44 | UNCLASSIFIED//FOR OFFICIAL USE ONLY | Embassy Minsk |
VZCZCXRO2397 RR RUEHAG RUEHAST RUEHDA RUEHDBU RUEHDF RUEHFL RUEHIK RUEHKW RUEHLA RUEHLN RUEHLZ RUEHNP RUEHPOD RUEHROV RUEHSR RUEHVK RUEHYG DE RUEHSK #0138 1191734 ZNR UUUUU ZZH R 291734Z APR 09 FM AMEMBASSY MINSK TO RUEHC/SECSTATE WASHDC 0243 INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE RUEHSK/AMEMBASSY MINSK 0247
UNCLAS MINSK 000138 SENSITIVE SIPDIS E.O. 12958: N/A TAGS: EINV ETRD ECON PGOV BO SUBJECT: BELARUS: DENIAL OVER DEPTH OF ECONOMIC CRISIS REF: MINSK 132 Summary ------- ¶1. (SBU) The GOB is realizing more and more that the global financial economic crisis will take a bigger toll on Belarus than originally expected. Senior government officials led by Lukashenka try to look optimistic (and so do the official statistics). The reality, however, is not bright and the prospects for the rest of the year do not look good. Loans from the IMF, Russia and Venezuela have undoubtedly cushioned some effects of the crisis but the monies, spent mostly to support the Belarusian ruble (BYR), are running out fast. End summary. ¶2. (SBU) More than 60% of all Belarusian-made products are manufactured to be exported. Since October 2008, Belarus lost about 50% of its exports to Russia, 30% to China and 75% to Ukraine. The GOB is urging urges industry leaders to look for new markets (e.g. in Asia and Africa), be more export flexible and to not shrug off smaller export shipments. It has also committed to provide cheap loans to large industries without requiring any serious recovery plans. The most recent move, Lukashenka's demand to sell more at home, is widely believed by independent experts to be doomed as local markets are too small to consume domestic production. As a result, industrial production is expected to shrink 25-30% through 2009. In a protectionist effort to reduce imports, the GOB has introduced prohibitive import tariffs on many food products (up to 180%) and consumer goods (up to 40%). ¶3. (SBU) The above efforts have been accompanied by selective steps of economic liberalization, e.g. reduction in red tape and taxes, a moratorium on unlimited inspections by numerous governmental agencies, etc. These efforts, however, have not been supported by in-depth market reforms. In his April 23 annual address (reftel), Lukashenka made it very clear that he will allow economic liberalization only to the extent that it does not encroach on his rule. That means that all pro-market efforts of liberal-minded government officials will bear no fruit and Belarus will see neither fair and transparent privatization regulations nor less rigorous government control. That said, independent economic pundits, the Belarusian internet community, and people in the street share the assumption that once the regime fails to secure more foreign loans, Lukashenka may be forced to launch selective privatization of the most lucrative industrial assets. There seems to be no alternative opinion on who will benefit most from such ad hoc privatization. This, however, may or may not happen as Lukashenka announced April 25 that foreign loans taken by Belarus so far were less than 8% of its GDP, or far less than the initial level of concern (25%). Comment ------- ¶4. (SBU) Without any doubt, more than crisis itself, Lukashenka fears crisis-related social unrest. In his April address, he demanded that "production be protected" and "jobs be preserved" at any cost. Lukashenka also repeated on several occasions that he will tolerate no loss-making in the public sector and that any instance of such loss-making will be viewed and treated as a crime. While the populace is used to such remarks, and Belarusians are worried about the crisis, very few of them blame the regime or are ready to protest its policies. People's survival skills taught in Soviet times are still in vogue: after a long winter, a sunny spring prompts people to work hard at their dachas with attached small plots of land, take occasional seasonal jobs, and enjoy their modest lives as much as possible. The crisis does not seem to be on top of their everyday agendas yet. It remains to be seen what the situation will be like later during the year. MOORE
Wikileaks
Wikileaks: Belarus 