Oil export duties 'shock' for Belarusian economy - IMF envoy

The Belarusian economy has been heavily hit by the introduction of duties for the reexport of Russian oil, the International Monetary Fund's envoy to Belarus said.

"This was a shock for Belarus's economy, which has been estimated at about $2 billion this year, while the current account deficit accounted for 13 percent of GDP," Natalia Kolyadina said.

Russia exported more than 21 million tons of oil to Belarus last year, but only 5-6 million tons was for domestic consumption. The rest was re-exported, some after passing through one of the country's two oil refineries.

Russian First Deputy Prime Minister Igor Sechin suggested in December that Belarus could import the domestic volumes duty-free, citing the "brotherly relations" between the two countries, leaving the remaining 15 million tons subject to export duties.

Moscow and Minsk faced off at the start of the year over tariffs on imports of Russian oil, which Belarus said should be completely duty-free in the Customs Union.

"An increase in oil prices has caused a significant decline in oil refineries' profitability. In connection with this, oil export has significantly decreased," the IMF official said, adding that the Belarusian government had taken steps to decrease the impact of the "shock" on the country's economy.

The introduction of oil export duties forced Belarus to halve crude oil exports in the first half of 2010. Export of petroleum products has lowered by 40 percent, and the output of Belarus's oil industry by 30 percent.

Belarusian President Alexander Lukashenko has pledged to seek alternatives to Russian energy supplies.

"Diversification of the [Belarusian] economy is certainly necessary, but Russia and the EU will remain Belarus's major trade partners," Kolyadina said.

The CIS Economic Court ruled on September 7 that Moscow and Minsk must come to an out of court agreement within one month on a dispute over export duties.

The court dismissed a request from Belarus that Russia be prohibited from levying export duties on oil products until the end of the dispute.

MINSK/NEW YORK, September 22 (RIA Novosti)


Share |

Partners: Social Network