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Russia/Belarus: Moscow Skeptical About Union On Anniversary

Moscow, 2 April 1998 (RFE/RL) -- Judging from the first pages of Russia's main dailies, the first anniversary of the Union between Russia and Belarus is not top news in Moscow. Articles commenting on the event, which in Belarus is celebrated by presidential decree as a national holiday as the Day of the Unification of the Belarusian and Russian People, find places mainly on third pages, and their tone is rather skeptical.

Are Russian officials and journalists alike simply too busy with political negotiations on the future of the new Russian government? Or is there some other reason for this apparent lack of interest?

The daily "Izvestia," noting with some surprise that no major speeches or celebrations for the anniversary are expected in the Kremlin, writes: "Russian authorities either don't see any reason to celebrate, or are embarrassed by the last developments of the Union, officially created one year ago." The daily argues that the Russian-Belarus Union, officially created April 2, 1997, "has likely become a burden" for Moscow.

"Izvestia" is controlled by "Oneximbank" and its President, Vladimir Potanin is seen as close to former first deputy prime minister Anatoly Chubais, whom Belarusian President Alyaksandr Lukashenka accused of masterminding the dramatic drop in the exchange rate of the Belarusian ruble last month, together with Russia's main banks. The negative comment on the Union in today's edition could, therefore, be interpreted as a response to Lukashenka's accusations.

However, papers controlled by Chubais' opponents, including "Nezavisimaya Gazeta," which is part of the media empire of business tycoon and Kremlin insider Boris Berezovsky, have also mostly ignored today's anniversary.

One of the few Russian official comments marking the first year of the Union Treaty today came from Ivan Rybkin, the acting deputy Prime Minister in charge of relations with the Commonwealth of Independent States (CIS). Rybkin, who yesterday traveled to Minsk and gave Lukashenka a personal message from Russian President Boris Yeltsin, was quoted by the Itar-Tass news agency as saying "the Union of Russia and Belarus is now a reality." However, Rybkin declined to specify the content of the message, saying it was confidential.

Rybkin, who also met Belarus' Prime Minister Syarhey Linh, said he had "very constructive and substantial talks with the Belarusian leadership on a broad range of issues." He said the talks focused on the preparation of the next CIS Summit, scheduled for the end of April, and on the "most pressing cooperation issues" between Moscow and Minsk." Cooperation issues included "aspects of monetary, financial and customs activities, as well as gas, oil and electricity issues," Rybkin said.

He also said that the two countries have agreed to set up a joint working group to study Belarus' current difficult financial situation, and the recent currency crisis. Government officials and representatives of the two countries' central banks will be part of the working group. According to Rybkin, the sharp fall of the Belarusian ruble in March was "a serious lesson and we must all draw conclusions from it." But, he added, Belarus' National Bank made a mistake when it withdraw from trading on the Moscow Interbank Currency Exchange in February. Russian operators are the main foreign exchange traders in Belarus. Minsk failed to shore up its plunging ruble currency with protectionist moves in March, and in doing so managed to antagonize Moscow.

The Belarusian ruble weakened to 64,000-69,000 to the dollar, from 52,000-54,000 one week before. The drop followed Belarus' Central Bank barring foreigners from foreign exchange trading. Russia's Central bank stopped quoting an official rate against the Russian ruble, and recommended Russian citizens refrain from trading in the Belarusian currency.

Lukashenka, a supporter of a command economy, blamed the currency crisis, first, on a Western conspiracy for the ruble's collapse, and, then, on plots hatched in Moscow by reformers, lead by Chubais, who is opposed to his economic policies. Lukashenka ordered the rate to be 41,000-42,000 rubles per dollar at exchange points, and the National Bank complied quite rapidly, but using harsh administrative methods.

Russia's Central Bank "emphatically denied" in statements having been involved in the currency drop, and said Belarus' protectionist measures had a "clearly anti-Russian bias." Most Russian officials and economic analysts predict that, without stricter monetary and credit policies, a dramatic financial crisis, including further devaluation of the Belarusian currency, is inevitable.

The currency crisis came as relations between the two countries were already growing difficult. In recent months, Russia has demanded cash payments for its natural gas, and Belarus has responded, threatening to stop key Russian gas transits across Belarus to Europe. And, Lukashenka has intensified his criticism of the Russian media, which have attacked his rule as dictatorial and his model of "market socialism" as inefficient.

Lukashenka has been traveling intensively in Russian regions during the last months, and more than 60 Russian regions, or Federation 'subjects,' have signed cooperation agreements with Belarus, including economic agreements that Lukashenka says are essential for his country's economy.

However, Lukashenka critics say that this effort will largely be ineffective. They have noted that 70 percent of trade between the two countries takes place through barter operations, as the Russian regions dealing with Belarus include Russia's less prosperous regions, which cannot pay for Belarusian products. Meanwhile, the experts say, exports to other countries have continued to decline.

Even one of Lukashenka's strongest allies in Russia, the powerful Moscow Mayor Yuri Luzhkov, a populist who is one of the main supporters of the idea of integration between Russia and Belarus, avoids paying cash for Belarusian products.

The daily "Russky Telegraf" has reported that at a meeting of the Central Russian Inter-Regional Association in Moscow this week, Belarus' Deputy Prime Minister Vasil Dalhalou and Moscow city and regional officials signed an agreement on the supply of Belarusian engines for small Russian trucks made by the Zil factory in Moscow. The paper reported the supplies will be paid through barter. In exchange for engines, Belarus will receive Tajik cotton from Moscow.

As "Izvestya" put it in its article commenting on the first anniversary of the Union, "the practice shows that economic issues are more important than the idea of historic brotherhood" between the two Slavic countries.

Despite optimistic statements by Lukashenka and his officials on the eve of the celebration, it appears many in Moscow are skeptical about the effectiveness and the very future of the Union.