BELARUS NEWS AND ANALYSIS

DATE:

02/08/2007

Belarus to Repay Russia Debts

MINSK, August 2--Accusing Russia of launching a hostile economic takeover of his country, Belarussian President Alexander Lukashenko promised on Thursday to repay a half billion dollar gas debt.

Lukashenko launched his tirade a day before Russian gas monopoly Gazprom was due to make good on a threat to halve deliveries to Belarus, a vital transit route for oil and gas shipments to Europe.

While repaying the $456 million gas debt may avert possible supply disruptions to Poland and Germany, Lukashenko's rhetoric heralded a slide in relations, just as Russia prepares for parliamentary and presidential elections.

Lukashenko accused Russia of using its power to seize economic control.

"Russia wants to privatize not only individual businesses -- and even grab them for free. It wants to privatize the whole country," he told journalists in Minsk.

State-controlled Gazprom, which put a squeeze on Russia's poor western neighbor by doubling export prices to $100 per 1,000 cubic meters in January, had no comment on Lukashenko's remarks.

Lukashenko, according to news agency reports, said Belarus would draw on its limited financial reserves to repay the debt after a grace period expired on July 23.

He also said he had appealed to Hugo Chavez, the populist president of Venezuela, for financial help.

"Our reserve fund will be laid bare, but other states are prepared to step in and help -- including Chavez and foreign commercial banks," Lukashenko said.

Gazprom's threat echoed previous disputes between Russia and its neighbors -- Belarus and Ukraine -- which caused gas and oil supply cuts to Europe in the past three winters, underlying Europe's heavy dependence on Russian energy resources.

This time, Gazprom has told European customers it is ready to use alternative routes to ensure steady supplies, and take legal action if Belarus siphons off gas from transit pipelines.

Source:

http://www.alalam.ir/english/en-NewsPage.asp?newsid=029030120070802215013