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Why Did Slovenia Spare Belarusian Mogul From EU Sanctions?


An artist's depiction of the planned Kempinski Hotel in Minsk, due to be completed by the end of 2013.
An artist's depiction of the planned Kempinski Hotel in Minsk, due to be completed by the end of 2013.
The European Union has agreed to add another 21 individuals to its expanding Belarus blacklist, a response to Minsk's continuing crackdown on the opposition, civil society, and the press.

But staunch opposition from member state Slovenia spared a 22nd person, Belarusian oligarch Yury Chizh, from the visa ban and assets freeze. Ljubljana threatened last week to veto the list, apparently over Chizh's inclusion. The 48-year-old mogul controls companies in energy, construction, real estate, retail sales, pharmaceuticals, and other sectors, and is a financier of Belarus's authoritarian President Alyaksandr Lukashenka.

Ljubljana's stance, which has angered some EU officials, appears to be driven by economic interests -- specifically, a Slovenian company's contract to build a controversial hotel in Belarus.

In a presidential decree issued on May 11, 2010, Lukashenka gave development rights for a tract of land in central Minsk to Elite Estate, which Belarusian media have reported is an arm of Chizh's holding company, Triple. Elite Estate was given the right to lease the area during construction work "without an auction" and was not charged the usual costs for the deal's paperwork.

The project, conceived in preparation for the city's hosting of the 2014 International Ice Hockey Federation (IIHF) World Championship, features the planned five-star Kempinski Hotel. The nearly 23,000-square-meter building is meant to accommodate the expected influx of spectators. In total, the plan is estimated to cost more than 100 million euros ($134 million).

Yury Chizh
Yury Chizh
While local heritage-protection activists have protested the planned demolition of a historic power station, the deal has not generated major controversy.

That changed after the regime's brutal crackdown on the opposition in the wake of the disputed December 2010 presidential election. During the government's campaign to arrest hundreds and restrict civil liberties even further, European Parliament President Jerzy Buzek, officials, and activists said Belarus was unfit to host the hockey tournament. They petitioned the IIHF to reverse its decision.

Riko Steps In

Despite the controversy, the Slovenian construction firm Riko Group announced on February 20 that Chizh's Elite Estate had awarded it a contract to build the hotel and surrounding complex.

According to its website, Riko has been active in Belarus for a decade. In February 2011, the company announced a 54 million-euro ($73 million) deal with state energy company Minskenergo to construct two power stations.

Riko CEO Janez Skrabec reportedly invited Lukashenka to Slovenia for a skiing trip in 2004, when the Belarusian leader was under an EU-wide travel ban and Slovenia was slated to join the bloc within months.

On February 27, Slovenian Foreign Minister Karl Erjavec said his country "couldn't agree with the fact that only one businessman was included" on the new EU sanctions list.

Slovenian Foreign Minister Karl Erjavec
Slovenian Foreign Minister Karl Erjavec
Local media quoted his office as saying Slovenia "supports restrictive measures imposed by the EU against Belarus and intended actions of the Belarusian authorities against those who violate human rights, preventing the development of democracy, and civil society."

With Lukashenka's crackdown continuing despite existing sanctions, Brussels has recently sought to widen the scope of its sanctions efforts to include individuals and entities who prop up the government economically.

In a statement sent to RFE/RL's Belarus Service, Riko said, "Slovenia has taken its position that it will not impede or weaken bilateral economic relations with partners from Belarus."

It continued: "We at Riko think that economic sanctions of the European Union against Belarusian companies would lead to an even greater shift of the economic flow of these companies from European partners to economic partners from the Russian Federation, China, Turkey, Kazakhstan, Ukraine, etc. And this cannot be in the economic interest of the EU."

The company's statement said other EU members shared Slovenia's position. Slovenian media quoted unnamed sources as saying that Latvia also opposed the measures against Chizh. The oligarch has business interests in that Baltic country as well as in Lithuania, Germany, and other EU member states.

In response to Ljubljana's move, Polish Foreign Minister Radoslav Sikorski told reporters in Brussels, "This is a sad day for the European Union."

"It showed that the economic interests of one state turned out to be more important than the need to influence President Lukashenka's power to release political prisoners," he added.

Sikorski also tweeted: "[I] hope guests [at] the Kempinski [Hotel in] Minsk will spare a thought for the Belarus[ian] political prisoners who rot in jail so that they are comfortable."

Written by Richard Solash in Washington with RFE/RL's Belarus Service and Rikard Jozwiak in Brussels
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