BELARUS NEWS AND ANALYSIS

DATE:

01/06/2009

Lukashenko Hits Back After Kudrin Remarks

Reuters

MINSK -- Belarussian President Alexander Lukashenko declared an end Friday to "begging" Russia for financial help and suggested that Moscow's economic woes, rather than his country's, were the reason it shelved a $500 million loan offer.

The comments came a day after Finance Minister Alexei Kudrin said the funds were no longer available because Belarus -- linked by a "union treaty" with Russia since the 1990s -- could be insolvent by the end of the year.

Kudrin's remarks appeared to reflect growing frustration with Belarus, whose loyalty is now caught in a struggle for influence between Russia and the European Union.

"If it doesn't work with Russia, there is no need to bow down, no need to whimper and weep. We will have to try our luck in another part of the planet," Lukashenko told a gathering of economic officials, the official BelTA news agency reported.

"Let me say this loud and clear. No begging or beseeching. If they haven't got the $500 million they promised us long ago, there is no need to go asking for it."

Lukashenko said Kudrin's comments had "sown panic" throughout his country of 10 million, and he rejected the pessimistic view of Belarus' economy.

"If they have such a wonderful economy, where does their 10 percent decline in GDP come from?" Lukashenko said, BelTA reported. "Our economy may be different, but we are expecting growth of 1.5 percent this year."

Prime Minister Vladimir Putin, speaking after talks between the two governments, softened some of Kudrin's criticism. But Lukashenko said he believed that the two had coordinated their positions.

Russia, with good reserves following a decade of economic growth, has promised nearly $5 billion of rescue credits to ex-Soviet allies, including Belarus, Kyrgyzstan and Armenia.

Belarus received the first tranche of $1 billion last year followed by another $500 million this year. Kudrin said further financing was halted as Moscow was unhappy with Lukashenko's reliance on "administrative mechanisms" in economic policy.

Russia's ambassador to Belarus said the future of the loan depended on Minsk's talks with the International Monetary Fund, which has yet to approve the second $400 million tranche of a $2.4 billion loan program.

Strains in relations between Russia and Belarus became acute after a 2007 dispute over energy supplies and prices.

Russia has also been alarmed by Belarus' rapprochement with the EU, which the Kremlin fears could threaten its interests and give Lukashenko new bargaining power with Moscow.

He also urged Belarussian Prime Minister Sergei Sidorsky to start looking for alternative markets for Belarussian goods.

"Surely, [he] need no longer take his ministers down such a beaten path," Lukashenko said. "Why keep going to Russia, where we simply get kicked around?"

Source:

http://www.themoscowtimes.com/article/1009/42/377564.htm

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