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Poland, Belarus & Ukraine Report: June 22, 1999


22 June 1999, Volume 1, Number 5
POLAND
Transport Ministry Wants Cargo Scales On Borders. According to the Transport Ministry, Poland could collect up to 4 million zlotys ($1 million) more in customs revenue yearly if all its border checkpoints were equipped with scales for weighing cargo overloads on trucks. A government conference on cargo-weighing problems at Bobrowniki on the Polish-Belarusian border on 16 June agreed that the government must find money to finance the installation of scales at border checkpoints.

It was also noted at the conference that only 0.5 percent of Polish roads meet EU guidelines. In order to adapt itself to EU road transport standards, Poland will have to build some 5,000 kilometers of new roads. That effort will cost the government at least 24 billion zlotys ($6 billion), far above the annual 200 million zlotys allotted currently for road development.

Telecommunications Giant To Focus On The Internet. Telekomunikacja Polska SA, until quite recently Poland's telecommunications monopoly, has decided to create a company--TP Internet--for dealing with Internet communications. The company's founding capital, according to the 17 June "Gazeta Wyborcza," will amount to $15 million. TP Internet will provide access to the Internet and e-mail addresses to its customers as well as assist trade companies in establishing virtual shops. TP Internet will also create its own service to help seeking information and interesting sites on the web.

It is estimated that there are some 2.5 million web surfers in Poland. In May 1996 Telekomunikacja Polska SA offered free access to the Internet through a nationwide number--its customers pay only the cost of local telephone connection while being online. That move caused troubles for many small firms that provided paid access to the Internet. Now Telekomunikacja Polska SA wants to expand its Internet offer to challenge the competition of cable television networks. El-Net, a company that has recently been allowed to provide telecommunications in Warsaw, offers access to the Internet in a package with cable television programs. TP Internet is seen as Telekomunikacja Polska SA's response to emerging competitors in Poland's communications market.

BELARUS
Looking For Cash In Non-Cash Deals. The Belarusian government on 16 June decided to introduce a tax on barter deals in foreign trade. The tax will amount to 5 percent of the price of raw materials and products imported to maintain domestic production, and to 15 percent of the price of other export/import commodities. The barter tax will not be imposed on imported oil, gas, electricity, coal, seafood, wheat, barley, vegetable oil, raw sugar, raw tobacco, wool, tea, coffee, and some other products. According to the government, the introduction of the barter tax will reduce the volume of barter deals in foreign trade and provide additional revenues to the cash-strapped treasury.

Barter operations accounted for 34.5 percent of Belarusian exports and 28.5 percent of Belarusian imports in 1998. In trade with Russia, barter made up 54 percent of all deals.

The 17 June "Izvestiya" reported that the barter tax will hardly affect the Belarusian-Russian trade, since all Russian exports have been excluded from that tax. "As a matter of fact, all integration has now boiled down to a 'mutually advantageous' barter trade between the two neighboring countries," the newspaper concluded.

The City Must Make Hay In The Country. The Brest Oblast Executive Committee has issued a directive obliging all enterprises and organizations in towns and cities of Brest Oblast to help the farmers in haymaking, Belapan reported on 16 June. City enterprises and organizations were given four months to send their personnel to oblast collective farms to comply with the directive. The required minimum output is 200 kilograms of hay per capita. Those enterprises that help farmers in purchasing weed-killer or repairing agricultural equipment will have the right to reduce the haymaking quota by 10 percent. Enterprises are also obliged to provide medical care, housing, and haymaking tools--scythes, pitchforks, and rakes--for their employees during the haymaking campaign. Belapan reported that only a few enterprises have so far been so smart as to send their employees to make hay while the sun shines.

No Work For Prisoners In Navapolatsk. "Many will not learn what re-education by labor means," the Vitebsk-based "Narodnoe slovo" reported on 5 June, referring to some 3,000 prisoners in the Navapolatsk Corrective Labor Colony UZh 30/10. The colony administration has managed to find employment for only 700 prisoners, while the others have been idle for several years. The monthly maintenance of one prisoner costs 5 million Belarusian rubles ($20), while the average monthly wage of those employed stands at 611,000 Belarusian rubles.

Colonel Uladzimir Stsehin, chief of the colony, told the newspaper that the Interior Ministry has recently ordered him to find employment for 70 percent of his prisoners. Among them, 359 were sentenced for premeditated murders, 744 for inflicting serious injuries, 199 for rapes, and 562 for robberies. Stsehin admitted that there are infectious diseases among prisoners, including AIDS.

UKRAINE
Suicides In Donbas Attributed To Economic Hardships. The number of suicides in Donbas, Ukraine's coal-mining region, has exceeded 700 since the beginning of the year, the Moscow-based "Segodnya" reported on 17 June. Sociologists suggest that the reason for most suicides is the depressive feeling on the part of victims that they have no prospects for the future and thus there is no reason to live.

According to the newspaper, the Ukrainian government, urged by the IMF to restructure the coal-mining sector, has brought about an "enormous disintegration" of the coal-mining industry in Donbas. "[Closed] mines have been flooded with water, hundreds of thousands of people have lost jobs and fled the region, mining towns are becoming empty, and the remaining residents pull down public buildings for firewood in [the] winter," "Segodnya" reported.

The report said there have remained only women and children in the towns of Stakhanov and Teplohorsk, while all the men have gone to Russia to earn money. A three-room apartment in Stakhanov can be bought for mere $200, while in Teplohorsk it is even cheaper and costs only $100. Long lines for bread that is distributed free of charge to poverty-stricken residents are a common sight in those towns, "Segodnya" noted.

Luhansk Will Develop According To Its Own Program. The government on 14 June approved a program of social and economic development of Luhansk Oblast for 1999-2000, InfoBank reported. According to the 12 June "Region," the program was worked out by "several dozens of [scientific] institutes" and a "host of government structures" and may be viewed as a model development plan for other Ukrainian regions as well. The newspaper said the program gives local authorities more levers of economic and financial control in the oblast. In particular, the oblast administration will take control of a number of enterprises that have so far been managed by Kyiv ministries. As part of the program, the government postponed until 2005 the repayment of some 1.9 billion hryvni ($480 million) granted to the oblast as a commodity credit. The oblast administration was also obliged to draft an energy-saving program, providing for a twofold reduction of the oblast's energy-intensive production sector and services until 2010 and a 22 percent decrease in its gas consumption in 1999.

Poltava Oblast Becomes Subsidized. "In recent years Poltava Oblast was a net contributor [to the state budget], one of the very few in the country, but beginning this year it has been forcibly made a subsidized oblast," Poltava Oblast Council Oleksandr Poliyevets complained to the 16 June "Holos Ukrayiny." That change in the oblast's financial situation followed the government's decision to reduce the oblast budget's share of taxes collected locally. Thus, the oblast deduction from the income tax paid by state-owned enterprises was lowered from 70 percent to 50 percent; the share in the income tax paid by municipal enterprises was reduced from 100 percent to 50 percent; the share in the excise tax imposed on domestic commodities shrank from 20 percent to 10 percent. Poliyevets also complained that Kyiv takes all proceeds from the oblast's gas and oil extracting companies, while giving back only a "tiny bit" that in no way covers the costs of extraction.

QUOTES OF THE WEEK
"What an adventure we have had!" -- Pope John Paul II in the Polish parliament on 11 June, in an impromptu remark on Poland's transformations during his more than 20-year-long pontificate.

"As pope, and also a son of this nation, I address a sincere appeal to all the people of good will, and especially to my brothers in faith, to make every effort for Poland to enter the third millennium not just as a politically and economically stable and wealthy country but also one strengthened by a spirit of mutual love." -- Pope John Paul saying goodbye in Krakow on 17 June after his 13-day pilgrimage to Poland.

"I know that the term of [Mikhail Chyhir's] detention will last as long as the presidency of Mr. Lukashenka." -- Yuliya Chyhir on the arrest of her husband. Mikhail Chyhir served as prime minister in the Lukashenka administration in 1994-96 and was arrested in March 1999 on charges of issuing a dubious bank loan when he was a bank director in 1994.

"Hundreds and thousands of innocent people have been imprisoned following your instructions. There are many among them who have been broken and humiliated, who are now losing their human nature. They are slowly dying both physically and spiritually, and your personal contribution to that is indisputable. And those at large are in no better situation. They are facing even larger pauperization [than so far]." -- Former Agricultural Minister Vasil Lyavonau in a letter from prison to Lukashenka. Lyavonau, Lukashenka's former friend, was arrested in 1997 on corruption charges. Lyavonau's arrest in his office was televised to show how Lukashenka deals with corruption in Belarus. No legal proceedings against Lyavonau have been announced yet.

"Alyaksandr Lukashenka Has Called for Creative Work on Fodder Crop Areas." -- Headline in the 17 June "Zvyazda."

"It is necessary today to mobilize all available resources for fodder procurement. Grass is mowed in water meadows, woods, parks, and other non-agricultural areas. [The authorities] are setting up raion and, for the first time ever, oblast fodder procurement teams that are supplied with necessary equipment. [The authorities] have earmarked 1.6 trillion rubles ($6.3 million) for repairs of equipment and are attracting city residents [to haymaking]. True, not everything goes well with paying for their work. The average pay for one ton of hay is 500,000 rubles ($2). However, in today's circumstances, it is not an easy task to make one ton of hay. There should be additional financial incentives. But...it is not possible to sidestep solving this unexpected problem. Alyaksandr Lukashenka has demanded that the oblast administration chiefs complete the first mowing of hay no later than 10 days before the beginning of grain harvesting, that is, in early July." -- "Sovetskaya Belorussiya" on 17 June in its report entitled: "Fodder Procurement in the Hot Interior."

"We need to decide how to make the West buy our goods. And we can make them--if they do not buy our goods, we will not let them in here. Administration head [Mikhail Myasnikovich] has recently been there [in Japan--edit.] and reported to me that they have been notified that we simply will not let them with their goods in here as long as they do not let us in there." -- Lukashenka on 17 June.

"A regime of banditocracy has become firmly established in Ukraine." -- Socialist Party leader Oleksandr Moroz in his party newspaper "Tovarysh" on 17 June.

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