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Poland, Belarus & Ukraine Report: February 28, 2006


28 February 2006, Volume 8, Number 8
BELARUS
WHEN BREAD IS SWEETER THAN FREEDOM. According to a January poll by the Vilnius-based Gallup/Baltic Surveys, Belarusian President Alyaksandr Lukashenka enjoys support of some 55 percent of Belarusians, thus being practically able to win the upcoming presidential election in an absolutely fair vote. Why do so many people in Belarus support Lukashenka apparently of their own will?

One of the possible answers to this question may lie in the country's economy, which officially enjoyed a robust growth in the past four years. For many Belarusians Lukashenka's economic policies appear to outweigh his heavy hand in subduing political dissent and impinging on human rights and personal freedoms in the country.

Speaking to workers of the Minsk Automotive Plant in 1998, Lukashenka gave a memorable definition of democracy he claimed he was building in Belarus.

"We don't need democracy with hullabaloo," the Belarusian leader said nearly eight years ago. "We do need the type of democracy where people work and get paid, even if not much but enough to buy bread, milk, sour cream, cottage cheese, and sometimes a piece of meat in order to feed their children and so on." After a short pause, Lukashenka added: "Well, as regards meat, let's not eat too much of it in summer."

However one looks at Lukashenka's 12 years in power, one must admit that he has remained largely true to his words. He has all but eliminated the possibility of any uncontrolled "hullabaloo" from the opposition on the streets. And he has ensured that the overwhelming majority of Belarusians have jobs and get paid regularly, "even if not much."

According to official data, registered unemployment in Belarus stands currently at 1.5 percent. In neighboring Poland, unemployment is around 20 percent. The average monthly wage in 2005 was $205, up from $150 in 2004; the average monthly pension in 2005 was $98, up from $63 the previous year. The country's gross domestic product (GDP) doubled in U.S. dollar terms between 2002 and 2005, growing respectively by 4.7 percent, 6.8 percent, 11 percent, and 9.2 percent year-on-year in the past four years.

It makes little sense comparing the above-mentioned figures with their equivalents in other countries, since the cost of living in Belarus is much lower. But it is instructive to look at how Belarusians themselves feel about their economic wellbeing.

A poll conducted in Belarus by two Slovak nongovernmental organizations in January found that 24 percent of Belarusians assessed their economic situation as "very good" or "good," 59 percent deemed it "fair," and just 13 percent declared it to be "bad" or "very bad." According to 70 percent of respondents, the economic situation in Belarus has not changed in the last month, 13 percent said it has improved, while 7 percent said it has worsened.

It is not surprising, perhaps, that the same poll found that there was a prevailing feeling of political stability among Belarusians. According to 65 percent of respondents, the political situation in Belarus was "calm," while 12 percent found it even "positive." On the other hand, for 15 percent of respondents the political situation was "tense" and for 1 percent "critical."

No less revealing were the findings of the Slovak pollsters regarding the preferred values and goals that Belarusians attribute to the ideal president. According to 97 percent of respondents, the president should put primary emphasis on decent living standards (81 percent fully and 16 percent partly subscribed to this view); 91 percent said the president should predominantly be concerned with the preservation of state sovereignty (60 percent fully and 31 percent partly); and 86 percent deemed the president should primarily develop democracy (51 percent fully and 36 percent partly).

Assessing the chance of mass protests against a potential fraudulent presidential election on 19 March, 17 percent of respondents said they were possible, while 70 percent were of the opposite opinion.

Quite a few independent Belarusian economic experts predict that the current political stability in the country, which was coupled in recent years with palpable economic growth, is unsustainable in the longer term. They basically argue that Belarus's economy has already exhausted its administratively incited potential for growth and without deep restructuring and foreign investments may soon enter a phase of stagnation or even decrease, thus triggering a wider public discontent.

Lukashenka himself seems to be aware of such an unpleasant scenario looming. "We have already squeezed practically everything out of what we have inherited from the Soviet era and what we have built in recent years," he said in a television interview in January. "Practically all of our production sector is working at 100 percent capacity, apart from some small- and medium-sized enterprises."

Another serious problem that Belarus will have to inevitably deal with in the future is the country's dependence on -- or as some put it, "addiction to" -- cheap Russian oil and gas supplies, which can be seen as indirect subsidies by the Kremlin to Lukashenka's "socially oriented" economy and are estimated at $3 billion-$4 billion annually.

The Russian energy-related subsidies have helped Lukashenka not only keep his economy afloat but also expand its existing production capacities. At the same time, however, they have done little to adapt Belarus's command economy to the conditions of genuine competition. When Belarus eventually moves to embrace some market-economy methods and give entrepreneurs more economic freedom, many Belarusians may find that their country's economic stability in the Lukashenka era was hardly a real asset. (Jan Maksymiuk)

EU-FUNDED BROADCASTS SET TO BEGIN. The European Commission has announced that EU-funded independent media broadcasts to Belarus will start on 26 February. The 2 million-euro ($2.4 million), two-year project will be run by a consortium of Russian, German, Polish, Lithuanian, and Belarusian partners. The project, openly targeting a nondemocratic neighbor, is the first of its kind for the EU.

The EU has been keen to get the project up and running ready for Belarus's presidential election on 19 March.

European Commission spokeswoman Emma Udwin said on 23 February in Brussels that people in Belarus will have access to both independent radio and television news. "What we're able to announce from Sunday is daily radio programming, covering both news and more feature-style material, covering both developments in the EU and Belarus," she said. "And for TV, a weekly half-hour program covering the same kind of agenda."

The European Commission says the stations -- named European Radio for Belarus and Radio Baltic Wave -- will broadcast a 60-minute magazine program at peak time every morning. The program will be tailored to appeal particularly to young people.

An independent Russian television company, RTVi, based in Berlin, will broadcast a weekly 30-minute magazine program called "Window To Europe." The first edition will be broadcast on the evening of 26 February.

The television and radio broadcasts will contain material in both the Belarusian and Russian languages.

Belarusian voters will go to the polls on 19 March to elect a president for the next five years. Incumbent Alyaksandr Lukashenka is widely expected to be reelected for a third term. Under Lukashenka's rule, independent media has struggled to survive in the face of government pressure.

Udwin said there will be programming geared specifically for the run-up to the presidential election. "There will also be before the elections, some election specials, some live programs providing an opportunity for debate on the subjects that arise from the election campaign."

The pre-election radio broadcasts will be aired on medium wave and streamed on the Internet. Broadcasts will also be available as podcasts. The more popular and accessible FM band will come into use later and the television programs will be available on cable and satellite.

It is not clear how many people the broadcasts are likely to reach. Spokeswoman Udwin said the European Commission has no information about likely rates of penetration. She said the international consortium running the venture will launch a publicity drive, although the EU itself cannot get involved in such work.

The commission stressed on 23 February that the EU has provided the resources for the project, but has given the consortium and its partners in Belarus and outside a free hand in determining the content of the programming.

There are other broadcast initiatives to Belarus, besides the EU's project. Polish-funded Radio Racja, with a similar objective of broadcasting independent news to Belarus, began broadcasting on 22 February. The station broadcast to Belarus in 1999-2002, before it closed down due to lack of funding.

The European Commission also already funds a smaller, broadcasting venture for Belarus operated by the German international broadcaster Deutsche Welle. The station's Russian-language broadcasts to Belarus have been on air since fall 2005. (Ahto Lobjakas)

UKRAINE
IS UKRAINE'S RICHEST MAN ALSO ITS FUTURE PREMIER? In mid-February, 40-year-old Rynat Akhmetov -- one of Ukraine's richest men by virtue of his 90-percent stake in the Donetsk-based System Capital Management Corporation (SCM) -- was interviewed on his nationwide television station, TRK Ukrayina.

The interview was conducted by Raisa Bohatyrova, a leading member of the Party of Regions led by Viktor Yanukovych, President Viktor Yushchenko's main rival in the 2004 presidential election. Bohatyrova was elected to parliament in 2002 after Akhmetov, who had been considered a likely candidate, stepped aside, saying he did not wish to run for public office.

Things appear to have changed.

The TRK interview was, for many Ukrainians, the first opportunity to hear the usually reclusive billionaire describe his stance on a variety of subjects. The interview was widely watched throughout Ukraine, and established Akhmetov as a man with his own vision regarding the country's future.

Akhmetov's name is seventh on the Party of Regions' electoral list for the 26 March legislative vote. But the fact that his interview was televised nationally, rather than just in Ahmetov's native Donbas region, led some viewers to conclude Akhmetov sounded more like a candidate for prime minister than a man merely seeking a parliamentary seat.

Akhmetov denies he is seeking the premiership. But some of his comments during the interview could indicate otherwise.

"We need to form a government that cares about economic growth," Akhmetov told Bohatyrova. "What does that mean? It means a government of professionals, a government which will take not only power, but responsibility, into its hands."

Akhmetov went on to define a strong Ukraine as one where the country is dependent upon neither Russia, the United States, nor the European Union. He was going into politics, he added, "in order to see Ukraine enrich itself, in order that there be no poor people in Ukraine. I want Ukraine to hold in its hands the trophy for being the best country in Europe."

Akhmetov, an ethnic Tatar and practicing Muslim, was born in Donetsk in 1966. His father was a coal miner, and the family often lived in poverty. Akhmetov graduated from Donetsk State University with a degree in economics.

In 1996, Akhmetov took over the presidency of the Shakhtar football club in Donetsk after the murder of its owner, criminal boss Oleksandr Brahin. Around that time, he founded Donetsk City Bank, DonGorBank, and remains its majority shareholder.

In 2000 Akhmetov founded SCM, which rapidly became a very aggressive player in acquiring companies in the Donetsk region. Over the next few years, it took control of over 90 companies concentrated in the iron ore, coal, steel, and energy generation sectors. SCM also has interests in insurance and banking, food and beverage services, and hotels and hospitality.

Akhmetov's assets and personal fortune are sure to make him a major player in Ukrainian politics for years to come -- regardless of whether he becomes prime minister.

But his repeated assertions that a future Ukrainian government must be run by "professionals" and promote "economic growth" have only intensified speculation that the head of SCM -- one of Ukraine's largest corporations -- might be persuaded to head up the country's new government.

In the past year SCM has gone to extraordinary lengths to polish its image as a responsible, European-style corporation and overcome past rumors about reputed links to organized crime and unorthodox business methods.

In the summer of 2005, SCM launched a massive advertising campaign aimed at promoting the stature in Europe of Ukrainian businesses. Ads were featured in publications including the "Wall Street Journal Europe," "The Economist," the "Financial Times," and on television networks like CNN, EuroNews, and BBC World.

In order for Akhmetov to succeed in extending his popularity beyond the Donetsk region, many observers believe he will ultimately need to break ties with Party of Regions leader Yanukovych, his old friend and political ally.

This could be relatively simple. Yanukovych has no financial support base of his own, and relies on SCM and the Industrial Union of the Donbas for funding. Moreover, Yanukovych is seen by many Ukrainians as a former convict -- as a young man he was twice convicted of assault and battery -- and not fit to run for public office.

President Yushchenko's Our Ukraine bloc has reportedly discussed a possible coalition with the Party of Regions, but says it will not agree to Yanukovych becoming prime minister. It has, however, avoided such a categorical refusal regarding a similar deal with Akhmetov. (Roman Kupchinsky)

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