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Belarus criticizes new U.S. economic sanctions

New U.S. sanctions against state-owned enterprises in Belarus are "an act of aggression" and a blow to companies with ties to Russia, the former Soviet republic's prime minister said on Monday.
/ Source: Reuters

New U.S. sanctions against state-owned enterprises in Belarus are "an act of aggression" and a blow to companies with ties to Russia, the former Soviet republic's prime minister said on Monday.

The United States imposed sanctions last Thursday against four firms owned or controlled by a company linked to President Alexander Lukashenko in response to his government's crackdown on the political opposition.

"I believe that this is an act of aggression against the Belarussian people, a blow to the Belarussian economy, especially sectors which are linked to the Russian Federation through cooperation," Belarussian Prime Minister Mikhail Myasnikovich said at a meeting with Russian Prime Minister Vladimir Putin and other officials.

The new measures against Belarus, which lies between Russia and European Union states including Poland, were in addition to travel restrictions and other sanctions imposed this year against Lukashenko and other officials after a disputed December 2010 election in which he won a new term.

They were "a response to the continued incarceration of political prisoners, the crackdown on political activists, journalists and civil society representatives," State Department spokeswoman Victoria Nuland said on Thursday.

Lukashenko tolerates little dissent and has maintained power since 1994 through votes Washington considers illegitimate.

The sanctions apply to the Belshina tire factory, the Grodno Azot fertilizer manufacturer, the Grodno Khimvolokno fiber manufacturer, and the Naftan oil refinery.

The four firms are owned or controlled by the Belneftekhim Concern, the largest petrochemical conglomerate in Belarus which is already under sanctions for being owned or controlled by Lukashenko, the U.S. Treasury Department said.

The comments made by Myasnikovich in Moscow echoed previous appeals to a sense of solidarity in Russia with the neighboring Slavic, Orthodox Christian nation.


Many people in Russia see Belarus as a buffer against NATO and the EU, and Moscow has long helped keep Belarus' Soviet-style, state-dominated economy afloat with loans and inexpensive energy supplies despite often tense relations with Lukashenko.

Russian Prime Minister Vladimir Putin, meanwhile, hinted that Moscow could give struggling Belarus a break on gas prices next year if plans for a deal that would give Russia full control of Belarus' gas pipeline network go smoothly.

At a press conference with Myasnikovich, Putin declined to comment specifically on the U.S. measures.

However, he said, "It is my firm conviction that (sanctions) are never effective -- on the contrary, as a rule their effect is the opposite of the expected by those who impose them."

In recent years, Russia has tried to wean Belarus off cheap energy without losing its levers of influence on the nation of 10 million or pushing Lukashenko toward embracing the West.

Gas price disputes have troubled ties and prompted Russia to cut supplies to Europe via Belarus briefly in June 2010.

Belarus, struggling with an economic crisis brought on in part by lavish election-related spending, is paying $286 per 1,000 cubic meters of Russian gas now, up from $244.7 in the second quarter, and is to pay $300-$305 in the last quarter.

With a five-year contract for supplies expiring at the end of the year, Putin hinted prices next year could be easier to swallow if Russia is pleased with terms of a possible deal for Russia's Gazprom to buy the 50 percent of Belarussian gas pipeline network Beltransgaz it does not already own.

Putin said that talks over gas prices and a stake in Beltransgaz should be "synchronized" and that Russia had decided to introduce a lower coefficient in the pricing formula for gas shipped to Belarus starting from 2012.

Previously, Gazprom had said Beltransgaz and the gas price talks were separate issues.

"The final parameters should be defined during commercial talks. But we count on the process being synchronized with Gazprom's purchasing another half in Beltransgaz," Putin said.