BELARUS NEWS AND ANALYSIS

DATE:

13/11/2007

Belarus leader dresses down govt as economy slows

* Reuters

(Adds more from Lukashenko, U.S. sanctions)

By Andrei Makhovsky

MINSK, Nov 13 (Reuters) - Belarussian President Alexander Lukashenko dressed down his government on Tuesday for the ex-Soviet state's economic performance, which slowed in recent months, threatening to sack it next year. Belarus's economy, hit by a large gas price rise, slowed to 8.3 percent growth in the first 10 months of the year against 9.7 percent in the same period last year and industrial output growth slipped to 8.2 percent from 12.2 percent.

Belarus has a largely command economy left over from the communist era and absorbed in the New Year a doubling of the price it pays for Russian gas to $100 per 1,000 cubic metres.

"Unfortunately, I have the impression that the government in office is growing rusty," Lukashenko told a cabinet meeting, according to state news agency BelTA.

"I don't want to resort to changing officials. But you must understand that your task is not just paperwork and writing memos, but also deploying efforts so that all can see real progress in your work."

Lukashenko said the government is in the process of forming forecasts for next year and proposed the ambitious figure of 20 percent for economic growth due to demand for Belarussian goods.

"If the forecast in the first nine months of 2008 is not fulfilled, I will start forming a new government by the end of the year," he said. "And it will be extremely hard for you to find a job in the country."

Gross domestic product grew 9.9 percent last year. The government targets full-year growth of no less than 8.0 percent.

HIGH DEMAND FOR EXPORTS

Lukashenko told ministers high demand for Belarussian exports should enable growth to hit 20 percent.

"We should thank God for such a favourable situation in the world economy when there is demand for food products, clothing, footwear and building materials...," he was quoted as saying.

Lukashenko is accused by the West of vote-rigging, holding political prisoners and shutting down media, but remains popular among voters in the country wedged between Russia and three European Union member states.

The United States on Tuesday imposed sanctions on oil processor Belneftekhim, barring Americans from doing business with the refiner and freezing assets under U.S. jurisdiction.

Lukashenko and dozens of officials have been barred entry to the United States and European Union after he was re-elected to a third term last year in an election deemed fraudulent.

He has maintained high social spending and tells voters he has spared them from the upheavals of other ex-Soviet states.

Ministers have responded to increased energy prices by calling for raising foreign credits and considering selective privatisations, though major selloffs have yet to take place.

Belarus received its first two credit ratings from rating agencies in August and was praised two weeks ago by Moody's for its "recent excellent macroeconomic performance and low debt".

(Writing by Sabina Zawadzki;)

Source:

http://www.guardian.co.uk/feedarticle?id=7074173