Blackouts for Belarus

[bratticus]

Russia cuts electricity supply to Belarus, raising pressure on country to sell key industries
By Yuras Karmanau / The Associated Press / June 9, 2011

MINSK, Belarus — Russia halved its electricity supplies to Belarus on Thursday over back payments, ratcheting up the pressure on its crisis-crippled neighbour to sell lucrative economic assets.

The power cut hits Belarus as it suffers its worst financial turmoil since the 1991 Soviet collapse. The country recently devalued the national currency, causing panic buying of goods. But Russia has promised a bailout only on condition that Belarus privatize key industries, such as its network of natural gas pipelines.

Russia has traditionally been Belarus' main ally, but it phased out economic subsidies in recent years as it pushed for control of those strategic assets. Belarus' authoritarian President Alexander Lukashenko has refused to sell, causing ties to grow increasingly strained.

Belarusian Energy Ministry spokeswoman Lyudmila Zenkovich said Thursday that Russia cut the electricity supplies because Belarus still owed $54 million for shipments taken earlier this year.

Imports of Russian electricity account for less than 10 per cent of Belarus' needs and Zenkovich said consumers won't be hurt by the move.

"this won't hurt a bit"

She said Belarus will try to quickly settle its debt despite a shortage of hard currency.

The current crisis was triggered by Lukashenko's decision to raise government wages by one-third as he campaigned for re-election in last December's vote. The pay hikes fueled inflation and raised demand for foreign currency, quickly draining scarce government reserves. The government last month was finally forced to cut the value of the national currency, the Belarusian ruble, almost in half against the dollar.

The spiraling crisis has threatened the authority of Lukashenko, who has ruled the 10-million nation with an iron hand for nearly 17 years, earning the nickname of "Europe's last dictator" in the West.

Independent experts say Belarus would quickly need at least $9 billion in loans to stabilize its finances. ...

[pstarr]

bratticus, you must believe social/political disruptions in Belarus (and elsewhere) are a function of peaking oil supply? But this story is about electricity generated from natural gas and coal.

[Serial_Worrier]

Another Communist basket-case. More vindication for capitalism!

[radon]

But this story is about electricity generated from natural gas and coal.

This is a story of phased out Russian energy subsidies. Just an arm-twisting contest between the politicians re the Belarus pipelines, energy and other assets. Once the dust settles the ordinary Belarusians may well finish up paying Russian level (cheap and subsidized) housing energy bills, as a result of a "closer integration" between the two countries. But at this point no one knows yet how it will develop.

Another Communist basket-case. More vindication for capitalism!

Yes, after Greece, Portugal, Egypt... you name it.

Anyway, Belarus has nothing to do with communism. State capitalism, probably.

[bratticus]

Belarusians live worse, but there will not be a social explosion this summer
RIA Novosti commentator Anna Kurskaya / June 10, 2011

Belarus owes Russia two months’ worth of payments for electricity. The company Inter RAO, the Russian exporter of electricity, has imposed restrictions on deliveries. And this is not the only trouble Minsk faces in its current economic crisis. Belarus is experiencing renewed expressions of popular discontent, and this time they are not devised by the opposition. Drivers are seen protesting. As increases in oil prices persist (fourth time this year) so do queues in gas stations. Prices for cigarettes have risen by 30-60% since June 8, but, in reality, they have entirely disappeared from the market. It is still impossible to purchase foreign currency in exchange offices.

... The June 7 “Stop Gasoline” protests, against soaring petrol prices, saw dozens of participants block the city’s main street by staging automobile breakdowns.

“Dozens of motorists effectively paralyzed traffic on the Independence Avenue” says Alexei Korolev, editor-in-chief of independent Belarusian newspaper Novaya Vremya. “The protest lasted over two hours and even drivers who were simply passing by joined it. Onlookers cheered the drivers. Small banknotes were flying around in a symbolic gesture to demonstrate that they have become paper wrappers, devoid of any real worth. Five participants have already been arrested and put on trial.”

... The organization of “Stop Petrol” took place largely through the internet,” Korolev says.

[bratticus]

Belarus Limits Cross-Border Car Travel and Individual Exports
By Aliaksandr Kudrytski, Editing by Balazs Penz / Bloomberg / June 11, 2011

The Belarus government banned individuals from taking basic consumer goods such as home appliances, foodstuffs and gasoline out of the country following a devaluation of the local currency.

People are also barred from leaving the country by car more than once every five days as of today, according to an e-mailed government statement.

The move aims “to stabilize the situation with domestic car fuel sales as well as to prevent illegal exports of commercial goods disguised as private items,” the government said in the statement. It will help to “ensure economic stability in the country.”

President Alexander Lukashenko has ordered a reduction in gasoline prices and warned his government against sharp price increases after more than 100 cars blocked the main street in the capital, Minsk, on June 7 in protest.

Belarus allowed an overnight 36-percent devaluation of its currency on May 23 and raised its refinancing rate to the highest in the world a week later. It has asked the IMF for another stabilization loan on top of a bailout during the credit crisis, and will borrow $3 billion from Russia and other former Soviet countries on condition it sells $7.5 billion of state assets.

The move aims “to stabilize the situation with domestic car fuel sales as well as to prevent illegal exports of commercial goods disguised as private items,” the government said in the statement. It will help to “ensure economic stability in the country.”

President Alexander Lukashenko has ordered a reduction in gasoline prices and warned his government against sharp price increases after more than 100 cars blocked the main street in the capital, Minsk, on June 7 in protest.

Regulating the price of gasoline down artificially is the quickest way to have no gasoline for sale.

Belarus allowed an overnight 36-percent devaluation of its currency on May 23 and raised its refinancing rate to the highest in the world a week later. It has asked the IMF for another stabilization loan on top of a bailout during the credit crisis, and will borrow $3 billion from Russia and other former Soviet countries on condition it sells $7.5 billion of state assets.

The sale abroad by individuals of Belarus-produced cement, refrigerators, kitchen stoves, and detergents will be illegal as of tomorrow.

People were also banned from taking cereals and pasta abroad and were limited to taking 2 kilograms per person of meat, flour, sugar, cheese and some other foodstuffs. No more than two packs of Belarus-produced cigarettes per person will be allowed out of the country. ...

[bratticus]

Russia turns up the heat on Belarus power supply
IFandP Newsroom / June 10, 2011


Russia increased pressure on an increasingly fragile Belarus by cutting its power imports into the ex-Soviet republic by more than half as it tried to recover US$54m in unpaid bills.

Russia’s electricity exporter Inter RAO said it would cut off all power by 19 June if the debt was not fully met, according to the local Belta news agency. ...

[radon]

Belarus Limits Cross-Border Car Travel and Individual Exports
By Aliaksandr Kudrytski, Editing by Balazs Penz / Bloomberg / June 11, 2011

The move aims “to stabilize the situation with domestic car fuel sales as well as to prevent illegal exports of commercial goods disguised as private items,” the government said in the statement. It will help to “ensure economic stability in the country.”
...
The sale abroad by individuals of Belarus-produced cement, refrigerators, kitchen stoves, and detergents will be illegal as of tomorrow.

...

An article linked in the "Chinese bubble" thread called subsidized exports a "weapon of job destruction". Why wouldn't the Belarus government use this "weapon", following the Chinese example. To the contrary, they try to curtail that kind of export of the manufactured goods as much as they can.

President Alexander Lukashenko has ordered a reduction in gasoline prices and warned his government against sharp price increases after more than 100 cars blocked the main street in the capital, Minsk, on June 7 in protest.

The country's economic policy is now dictated by a 100 car drivers. A sort of new oligarchy.

[bratticus]

An article linked in the "Chinese bubble" thread called subsidized exports a "weapon of job destruction". Why wouldn't the Belarus government use this "weapon", following the Chinese example.

In order to have massively (and probably illegally) subsidized exports someone would have to loan them the money to pay for the subsidies. Either that or they could devalue their currency by crediting their central bank's account with it.

They'd also have to have some factories to make the exports with and those require electricity to power while Russia is cutting their electrical supply.

If they were going to play the Chinese game of "cheap exports as a path to prosperity" they should have started it years ago.

[bratticus]

I found this article too late, it comes before all the others in this thread:

Crisis-hit Belarus raises gasoline prices by 30%
By ANDREI MAKHOVSKY / REUTERS / June 8, 2011

MINSK: Belarus on Tuesday raised retail gasoline prices by 30 percent on average as the authorities made a fresh bid to keep a lid on an economic crisis while seeking an IMF bailout.

The hike by state fuel firm Belneftekhim, which raises the cost of a liter of gasoline at the pump to about $1, is the third in two months and means prices have nearly doubled since March, eating away at ordinary Belarussians' dwindling incomes.

The move follows a 36 percent devaluation of the country's rouble, a price freeze on some staple foods and the introduction of fuel rationing.

The step was taken "to protect the domestic market from unsanctioned exports of oil products and to decrease the disparity in car fuel prices between Belarus and neighboring countries," Belneftekhim said in a statement.

... Shortly after the ruble devaluation the government froze prices of key foodstuffs, but analysts say the measure may lead to shortages and prompt rationing, further denting confidence in Lukashenko's government. ...

So President Alexander Lukashenko follows up days later freezing the price of gasoline which will also risk leading to shortages.

[bratticus]

Russians Rally Against Gasoline Price Hike
Radio Free Europe, Radio Liberty / June 10, 2011

IZHEVSK, Russia -- Some 500 people staged a protest in the south-central Russian city of Izhevsk against the rising price of gasoline, RFE/RL's Russian Service reports.

The protesters marched through the city's central streets late on June 9 and gathered in front of the headquarters of the ruling United Russia party.

Izhevsk is the capital of the Republic of Udmurtia.

Gasoline prices in some parts of Russia have risen by as much as 16 percent since April.

Andrei Konoval, who is chairman of Udmurtia's Coordination Council for Civic Actions, said that police temporarily detained him and one of the organizers of the picket, Maksim Safronov.

Udmurt Interior Ministry officials say that only Konoval was detained.

Police said the protesters were detained for violating regulations on holding mass gatherings. ...

[bratticus]

Belarus leader threatens to 'whack' Internet protestors
AFP / June 15, 2011

MINSK — Belarussian President Alexander Lukashenko said Tuesday he would personally "whack" activists calling for protests on the Internet, after a growing economic crisis prompted rare demonstrations.

The opposition "in Minsk is using social networks to call for strikes," Lukashenko said while visiting a farm in the Minsk region, as reported by state television.

"I will watch and observe, and then whack them in such a way that they won't even have time to run across the border," the strongman added.

Lukashenko has so far responded with an iron fist to protests that are swelling as the country continues to experience economic problems.

Riot police were deployed at the weekend against Belarussians who blocked checkpoints on the border with Poland to protest new export restrictions. ...

[babystrangeloop]

Russia Mocks Belarus With Freaky Documentary Before Cutting The Power, Then Leaves Them Disconnected After Receiving Payment!

A Russian Insult to Belarus, via Airwave
By ANDREW E. KRAMER / NYT / June 29, 2011

... The documentary deprecated Mr. Lukashenko, showing him making absurd statements on economic policy and including video clips that seemed to highlight his megalomaniacal personality, all in a way NTV would never dare in a program about Russia’s own strong-handed leaders.

“If we don’t have shoes we will work 30 hours a day” to make them, Mr. Lukashenko proclaimed in one clip. “If we don’t have clothes we will work 50 hours a day,” he said, his fist pounding a lectern.

Gilt and red plush. Rococo bar backed by pink shell. The air is cloyed with a sweet evil substance like decayed honey. Men and women in evening dress sip pousse-cafés through alabaster tubes. A Near East Mugwump sits naked on a bar stool covered in pink silk. He licks warm honey from a crystal goblet with a long black tongue.

While being shown on Russian state-controlled television, the documentary mocked the Belarussian counterpart, using one of its clips of Mr. Lukashenko and his young son posing in the gold vault of the Belarussian central bank, a scene apparently intended to tamp down panic selling of the national currency.

The documentary wrapped up with footage of Mr. Lukashenko saying he expected to find oil and in this way resolve his country’s economic woes. Belarus has no known oil fields to speak of.

The Russian show then cited an expert saying that Belarus should abandon its currency and use the Russian ruble instead.

The show ended around 11 p.m. Tuesday in Minsk, the Belarussian capital. An hour later, the Russian utility Inter RAO switched off all electricity exports to Belarus. ...

Russia halts power to Belarus, forces debt payment (Update 4)
Additional reporting by Andrei Makhovsky; writing by Thomas Grove and Guy Faulconbridge; editing by James Jukwey and Anthony Barker / Reuters / June 29, 2011

Russian electricity exporter InterRAO said late on Wednesday it had received payment in full from Minsk and that supplies would be resumed within a couple days after it had cut power exports to the former Soviet country from midnight.

In a couple days? How does Russia expect Belarus to pay future electric bills if they waste time hooking them back up after receiving payments? Or are they counting on using this as an opportunity to punish them?

[Pretorian]

What happened is that Lukashenko mentioned to somebody that " there are no Russian people in Kremlin"-- hinting at Jewish origins of Medvedev.