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Poland, Belarus & Ukraine Report: July 20, 1999

20 July 1999, Volume 1, Number 8
Future EU Frontier Town Still Uncivilized. According to the 10 July "Gazeta Bankowa," Przemysl--a town in southeastern Poland, near the border with Ukraine--has lost the development prospects that it enjoyed in the mid-1990s owing to EU financial assistance and a trade boom with the post-Soviet countries.

In January 1998, Przemysl inaugurated a modern customs control terminal built under the EU's PHARE program at a cost of almost 2 million ecu ($2.04 million). The terminal is provided with state-of-the-art customs control equipment, computers, faxes, elegant furniture, and modern toilets. However, there are also drawbacks. The entrance door is too narrow for most visitors from Ukraine, who are not tourists with backpacks or businessmen with suitcases but shuttle traders with huge bags that cannot pass through the door. There is no air conditioning in the building; as a result, temperatures inside the building reach some 60 degrees Centigrade in the summer, meaning that neither customs officers nor their electronic equipment can function and that the terminal is open only sporadically, with customs checks taking place, as before, on trains traveling from Medyka (a border station) to Przemysl. Nor is there a waiting-room in the terminal; thus visitors from Ukraine have to wait for customs checks in the open air. Finally, most of the terminal's modern toilets are permanently closed (according to "Gazeta Bankowa," to prevent visitors from plundering and soiling them).

However, the days of peak traffic on the Polish-Ukrainian border traffic are over. In 1995, 10,000 foreigners visited Przemysl every day, while today they number only 800.

Marian Majka, deputy mayor of Przemysl, told "Gazeta Bankowa" that Przemysl residents failed to take advantage of the border trade boom in the mid-1990s. According to Majka, most of the money earned was sunk into "the gray [economic] zone or spent on building fabulous villas on the town's outskirts." As for the town authorities, they have failed to organize "civilized business" in Przemysl or to maintain the town's main bazaars. The main barriers to developing Przemysl today are corruption, criminality, and the lack of major business opportunities.

Polish Television reported on 14 July that the State Labor Inspectorate has closed the customs terminal in Przemysl for the whole summer because of the lack of air conditioning. Installing this convenience in the building would cost some 120,000 zlotys ($30,000).

Workers Urge Lukashenka To Step Down. On 10 July in Minsk, Belarusian activists organized a congress devoted to Belarus's economic and political crisis and the end of President Alyaksandr Lukashenka's five-year term in office. The two-hour congress was attended by 315 delegates from throughout the country and, according to "Belorusskaya delovaya gazeta," had something of the atmosphere of workers' meetings during the era of the conspiratorial activities of Vladimir Ulyanov (Lenin). In order to confuse the authorities, which might have tried to prevent the unsanctioned gathering, the organizers had put advertisements in independent newspapers announcing the meeting would take place at a "tourist center in Minsk's suburban area." In fact, the delegates were taken to the Palace of Veterans in downtown Minsk. According to Belarusian Television, the Palace of Veterans administration allowed the delegates in after the congress's organizers had claimed to be holding a meeting of a charitable organization devoted to discussing assistance for the needy.

In an appeal to the Belarusian president, the delegates urged Alyaksandr Lukashenka "to voluntarily resign" after 20 July, when his legitimate five-year term ends, according to the 1994 constitution. (Following the controversial 1996 constitutional referendum, Lukashenka prolonged his term by two years.) "We, the workers, think that Belarus, which is in the very center of Europe, may not have an illegitimate head of state. We are not going to be Europe's laughing stock, we will not allow this disgrace," the appeal reads.

In an appeal to the nations of Europe the Belarusian workers ask for support and solidarity in their "striving to build a free society with a developed economy" in Belarus without Lukashenka.

And in an appeal to the Belarusian lawmakers who abandoned the legitimate Supreme Soviet and chose to work in the Chamber of Representatives, the workers urge those Lukashenka-subservient deputies to stop their "senseless existence" in the illegitimate legislature and "follow the constitution."

Belarusian Ruble To Become Convertible? In yet another pledge to rationalize Belarus's monetary policy, National Bank Chairman Pyotr Prakapovich said on 14 July that he intends to peg the Belarusian ruble to one hard currency or a group of hard currencies in 1999-2000. Among the possible options, Prakapovich mentioned pegging the Belarusian ruble to the euro or to the euro and the U.S. dollar simultaneously.

The new monetary course will be implemented in two stages. In the first, which will last approximately one year, Belarus is to accumulate the necessary hard currency reserves and stabilize its monetary policy. In the second stage, Prakapovich hopes to satisfy the need for hard currency at Belarus's stock exchange and to secure the convertibility of the Belarusian ruble.

According to Prakapovich, Belarus needs hard currency reserves totaling $400 million in order to make this plan successful. He foresees three ways to replenish the National Bank's hard currency reserves: ordering all economic entities to sell 10 percent of their hard currency to the bank, privatizing state-owned enterprises for hard currency, and "normalizing relations" with the IMF and the West.

Who Seeks Shelter in Belarus? According to data released by the United Nations High Commissioner for Refugees, cited by Belapan on 15 July, there are 2,700 people seeking asylum in Belarus. Of these, 75 percent are Afghans, while others come from Abkhazia, Ethiopia, Iraq, Iran, Tajikistan, Sri Lanka, Somalia, and Pakistan. As of the beginning of this summer, Belarus granted refugee status to 187 people: 130 Afghans, 31 Georgians, 16 Ethiopians, and 10 Tajiks.

Official estimates say there may currently be 100,000-150,000 illegal immigrants in Belarus, most of whom are from Asia and Africa and came from Russia (with which Belarus has an open border). Many of them seek to cross the Belarusian-Polish border to proceed to Western Europe.

Conflict Surrounding Alumina Plant In Mykolayiv. On 24 June, the government dismissed Vitaliy Meshyn, director of the state-owned Mykolayiv Alumina Plant and appointed Mykola Naboka to replace him. That move provoked unrest among the plant's 7,000-strong work force. The parliament also protested Meshyn's dismissal, arguing that it is illegal, and asked the government to revoke it. Since Meshyn did not obey the order and remained in the plant, on 7 July police used force to remove him from his office. The government appointed First Deputy Industry Minister Serhiy Hryshchenko to oversee the facility and ease the transition for the new director.

The government said Meshyn was fired because of the company's worsening performance and growing debts. In addition, Meshyn was interrogated by the State Security Service on suspicion of selling alumina--the main component for making aluminum--to a network of intermediaries who resold it at higher prices and did not return those revenues to the plant. Meshyn responded that the government had to fire him in order to sell the plant to a foreign company.

The Mykolayiv Alumina Plant is believed to be one of the country's most lucrative companies slated for privatization. A report in the 15 July "Kievskie vedomosti" suggests that the replacement of the Mykolayiv plant's director is connected with the government's privatization plans and may have grave economic and even political consequences for Ukraine.

According to the Kyiv-based national daily, the new director, Mykola Naboka, maintains close ties with the British intermediary company Trans World Group (TWG), which controlled a number of key metallurgical plants in Kazakhstan in the mid-1990s. This year, the Kazakh Supreme Court declared the TWG's activities in Kazakhstan to be illegal and detrimental to state economic interests. The Kazakh authorities estimated the losses inflicted by the TWG on the state treasury at $400 million. According to Kazakh experts cited by "Kievskie vedomosti," the TWG registered a great deal of its profits in Kazakhstan as losses and transferred those revenues to its own accounts through offshore firms. The TWG also paid Kazakhstan only 50 percent or so of what it obtained on the world market for the goods produced at its Kazakh plants Moreover, in order to increase the TWG's profits, banks controlled by the TWG granted the Kazakh plants credits.

"Kievskie vedomosti" suggests that Naboka--who was involved in the TWG's schemes of getting money out of Kazakhstan--intends to stop supplies of Mykolayiv alumina to Sayanskii Aluminum Plant (Russia) and an aluminum plant in Tajikistan and to begin supplying Russian aluminum plants controlled by TWG, in particular, the Krasnoyarsk Aluminum Plant. The newspaper concludes that the Mykolayiv plant may follow the tortuous path of the TWG's Kazakh metallurgical plants and become fully controlled by TWG. Such an outcome, according to the newspaper, would inflict considerable losses on the Ukrainian economy and harm Ukraine's cooperation with its CIS partners, particularly Russia and Tajikistan.


by Jan Maksymiuk

Russian Prime Minister Sergei Stepashin announced on 5 July that Russia will sign a treaty with Belarus this fall, allowing the two countries "to enter the 21st century as a union-state." For those who may have lost count of Russian-Belarusian integration initiatives, this will be the third major agreement on a single Russian-Belarusian state. The first was signed in April 1996, the second one year later, in April 1997. There are many signs that this year's proposed document--heralded by Belarusian President Alyaksandr Lukashenka and Russian President Boris Yeltsin in a joint declaration on 25 December 1998--will not be the ultimate unification pact either.

Stepashin's pledge of quicker unification was preceded by attempted blackmail on the part of the Belarusian president. Addressing the 2 July session of the Belarusian-Russian Parliamentary Assembly in Minsk, Lukashenka threatened to seek rapprochement with the West if Russia continued to drag its feet on a closer union with his country. Following consultations with Yeltsin, Stepashin hastened to assure Lukashenka that the treaty will be ready within a month and will not be of simply a "declarative character."

As for Lukashenka's threat to repair relations with the West, Stepashin commented: "We would welcome that [move], and a union between Russia and Belarus should not in any case stand as an obstacle to creating a unified Europe." Both Yeltsin and Stepashin are perfectly aware that, as one Russian newspaper put it, "there is no way to the West" for Lukashenka.

Lukashenka's attempt at blackmailing Russia is rather a sign of his weakness and frustration as his presidency nears the completion of its fifth year on 20 July 1999. European democracies have not recognized Belarus's 1996 controversial referendum, by means of which Lukashenka extended his presidential term until 2001. So far, he has not appeared to pay much attention to what the West thinks about his legitimacy after 20 July. Rather, he seems to have scented another danger: What if Moscow strongmen--embroiled in their intricate wars for power--begin openly questioning his legitimacy and, consequently, his right to sign any interstate documents? Such a turn of events cannot be ruled out as Russia nears parliamentary elections in December and presidential elections next year.

There has been much speculation in the Russian media that Yeltsin is willing to repeat the "Milosevic scenario" in order to stay in power beyond 2000. The creation of the Russian-Belarusian union could serve Yeltsin's political longevity in the Kremlin in the same way as the 1994 creation of the Federal Republic of Yugoslavia helped Serbian President Slobodan Milosevic remain at the helm in Belgrade as the head of the unified state of Serbia and Montenegro.

Lukashenka is ready to accept Yeltsin as the union president provided that he himself is given the post of vice president. However, Kremlin planners have not envisaged any union presidency or common government. And what is more important, even such staunch proponents of Russian-Belarusian integration as Russian State Duma Chairman Gennadii Seleznev, Communist Party leader Gennadii Zyuganov, and Moscow Mayor Yurii Luzhkov have not insisted on the introduction of a union presidency. This should be taken by Lukashenka as a disappointing, if not alarming, state of affairs: Russian political elites have so far not devised any major role for him in the struggle for power in Russia. Moreover, it is unclear whether they ever intended to.

Yeltsin recently announced that he is ready to step down when his terms expires next year. Whether or not that is true, he may at least be willing to wait to take a final decision until after Russia's parliamentary elections in December. If the elections suggest that his preferred candidate will win the presidential race next year, he will most likely leave the political scene, placing the future of further integration with Belarus into the hands of his successor. If not, a "union option" that would prolong his rule might be used by him in earnest. In any case, no one should expect a treaty this fall that would allow Lukashenka to obtain the real levers of power in Russia.

Lukashenka recently declared that he will not accept a non-presidential power structure in the union-state. But it seems he will have no choice. If he refuses to sign another watered-down union treaty proposed by Moscow, he will find himself on the sidelines of the integration process, which he has so ardently championed. What is more, he may well find himself on the sidelines of all politics. Neglecting and even rejecting normal relations with Western democracies, he has become hostage to his one-sided policy of rapprochement with Russia. On the other hand, if he signs such a treaty, he will hardly get what he wants--namely, more power and more Russian resources to bail out the sinking Belarusian economy.

"From the very beginning [of his term], Lukashenka was nothing more than a puppet. ...The real power was in the hands of the puppeteer behind the screen. The only person who could allow himself [to move the puppet] was Boris Yeltsin with his family," the Belarusian independent weekly "Nasha Niva" commented on 28 June. That comment appears all the more bitter in light of the fact that most Belarusians still show no tendency or desire to stop being entertained in such a way.

"At the current stage, [the Belarusian-Russian union] will evidently be something in-between the Soviet Union and the European Union. It will be somewhat [more developed] in terms of its organizational form than the European Union. However, at the current stage, we will most likely not reach the organizational level of the former Soviet Union." -- Alyaksandr Lukashenka on 9 July, commenting on the Belarusian-Russian single state to "Die Woche."

"Segodnya" on 10 July asked Grigorii Yavlinskii, leader of Russia's Yabloko group, the following question: "Speaking recently on television, you used for the first time the term 'Anschluss' with regard to [Russia's] unification with Lukashenka's Belarus. This German word denotes the forcible incorporation of small Austria into Hitler's Germany. Who of the heads of the two ecstatically unifying states will in your view assume the role of Hitler? Yavlinskii responded: "Just remember the history: who went to where from where in 1938, and everything will become clear to you. Which of the two countries will pay more? Both will pay very dearly. ...There are some things that simply may not be done in politics. The Belarusians are our brothers! This is like saying to some of your cousins: 'I like you, give me your passport. Now we will both have one passport. I will enter your name in my passport."

"I am 25 years old, I have a higher education. I am of good health and have a small child. And I am leaving this country. I hope, for ever. I confess that I feel no pain. I was born in the Soviet era, developed my character in the era of short-lived [Belarusian] independence, graduated with a specialty in the totalitarian state, and have realized that I cannot live here anymore.... I have seen villages where people receive only enough money to buy bread and water. I have seen my parents yoked to a home-made plow. And everything in me is crying out: 'My child has not deserved all this!'" -- Unidentified woman in a letter to the Minsk-based independent "Narodnaya volya" on 13 July.

"Today, workers in Belarus earn $30-$40 a month, in Russia $150-$180, in Lithuania $150-$200, in Poland--$300-$400. Most of our pensions and allowances are below the subsistence level. Many families have forgotten the taste of fish, meat, and fruits. Despite obvious failures of his economic policy, the [Belarusian] president boasts of industrial growth, successes, and victories. Festivities, holidays, "fairs," and "harvest festivals" have become a common occurrence in present-day Belarus. Sometimes it seems to us that the president is more of a hockey player than a head of state." From an appeal to the Belarusian people adopted by a congress of Belarusian workers in Minsk on 10 July.

"A top [Ukrainian] statesmen has recently said that conducting a dialogue with the parliament is like talking to the deaf. He has forgotten to add: And to the mute. There is no legal name for the gag placed over the parliament's mouth. This is a typical gangsters' method. Any democratic counter-arguments are useless here, because [those using] a crowbar may be opposed only by [those using] a bigger crowbar. Today an ouster of the Cabinet of Ministers may be such a crowbar." -- Oleksander Moroz, leader of the Socialist Party and a presidential candidate, at the parliament session on 6 July, referring to the government's decision to halt radio and television relays from parliamentary sessions during the presidential election campaign.

"The Number of Signatures Collected in Support of Presidential Hopefuls in Localities Often Exceeds the Number of Their Residents" -- Headline in the 14 July "Fakty."

"Only a Lazy Man Could Fail To Collect 1 Million Signatures" -- Headline in the 16 July "Kievskie vedomosti."