Belarus gets $2.5 bln from Gazprom for 50 pct stake in Beltransgaz

Belarus has received $2.5 billion from Russian gas export monopoly Gazprom from the sale of the remaining 50 percent stake in the national gas pipeline operator Beltransgaz, the National Bank of Belarus said on Thursday.

“According to preliminary data, Belarus’ gold and foreign exchange reserves increased by $2.74 billion in November. The increase was facilitated by the receipt of $2.5 billion from the sale of Beltransgaz shares, and also by the conversion of non-reserve assets into reserve assets,” the bank said in a statement.

Under the deal reached last week between Moscow and Minsk, Gazprom has acquired 100 percent of Beltransgaz, in which it already owned a 50-percent stake.

Belarus’ international reserves reached $7.38 billion as of December 1, 2011, the bank also said.

The Belarusian ruble experienced pressure from a large trade deficit, generous wage increases and loans granted by the government ahead of the December 2010 presidential elections, which spurred strong demand for foreign currency in the first quarter of this year. As a result, Belarus’ central bank has devalued the ruble to 4,930 per dollar from 3,155.


Russia, Kazakhstan may cancel oil export duties within CIS free trade zone

Ukrainian Prime Minister Mykola Azarov has said Russia and Kazakhstan have agreed to cancel oil export duties for participants in a free trade zone being created within the Commonwealth of Independent States (CIS).

“For the first time, we fixed in the agreement the readiness of Russia, as well as Kazakhstan, another oil producing country, to cancel [oil] export duties within a limited period,” Azarov said in an interview with Ukraine’s Inter TV channel on Saturday.

Russian Deputy Finance Minister Sergei Shatalov said on Thursday Russia could cancel its oil export duties no earlier than 2020.

On Tuesday, the majority of the CIS countries signed an agreement to set up a free trade regime after two decades of debate. The CIS consists of Azerbaijan, Armenia, Belarus, Kazakhstan, Kyrgyzstan, Moldova, Russia, Tajikistan and Uzbekistan. Ukraine has not ratified the CIS Charter but participates in its activities. Turkmenisan, Azerbaijan and Uzbekistan are yet to decide whether to join the agreement.

Azarov said on Thursday the agreement may come into force in January 2012. It is yet to be ratified by member states.

In the interview with Inter, the Ukrainian premier said Russia’s high oil export duties were detrimental to Ukraine’s oil refineries.

“Oil export duties of $450 per ton ($64 per barrel) make our oil refineries unprofitable,” he said.

He also said he expected a new agreement on Russian gas supplies to Ukraine being negotiated by the sides to correspond to Ukraine’s “long-term interests.”

“We are certainly ready to compromise – and we will – because we don’t have other options,” he said.

In August, following a gas pricing row between Moscow and Kiev, Ukrainian state energy monopoly Naftogaz threatened to cut its gas imports from Russia if Moscow does not agree to lower the price.

Earlier this month, Former Ukrainian Prime Minister Yulia Tymoshenko was sentenced to seven years in jail on charges of abusing her power in the signing of a 2009 gas deal with Russia that Ukraine seeks to review. She has already appealed the verdict.

“The first thing that Russia needs is guarantees of uninterrupted gas supplies to Europe,” Azarov said. “We are trying to persuade our partners that we are ready to guarantee the reliability and stability of gas supplies by concluding the agreement.”

Russia annually pumps about 100 billion cubic meters of gas to European countries via Ukraine, which makes up 80 percent of its total gas supplies to Europe.

Russian gas exports to Europe via Ukraine have been disrupted several times in recent years over pricing rows with Kiev. In early 2009, Europe has been left without Russian gas for nearly two weeks after Russian energy giant Gazprom and Ukrainian state energy monopoly Naftogaz failed to agree on gas prices.

Kudrin slates Russia’s risky economic policy

A complex mixture of internal political motivations and favorable, but volatile prices for the country’s key export, oil, have prompted the Russian government to pursue a risky economic policy,  former Finance Minister Alexei Kudrin said in an article he contributed to Kommersant business daily on Tuesday.

“(The Russian government) has all the instruments to change this course, but it is necessary to determine priorities. But there is not much time for this,” Kudrin warned.

The government wants to increase budget spending by raising teachers’ wages and pensions and modernizing the military, which is estimated will consume up to 20 trillion rubles in the next decade alone .

Kudrin said meeting all the goals would produce a budget deficit, while Russia, as a G20 group member, had vowed to cut its deficit by half by 2013.

He also said that although oil prices had recently been at historic record levels, it was very volatile, while Russia’s surplus revenues were spent, with nothing left to replenish the country’s safety cushion.

If oil prices fall to $60 per barrel, the budget deficit will amount to 5.5 percent of gross domestic product and the rest of the country’s oil wealth Reserve Fund would be depleted within a year.

Kudrin said there were several options to cut the budget deficit – to cut spending, raise taxes or start up the printing press, with the last two options raising the prospect of setting back the business climate needed for economic modernization by from five to seven years.

To balance the budget, Kudrin recommended ensuring a balanced budget with oil prices at $90 a barrel in 2015 and setting rules for spending surplus oil revenues, which seriously affect inflation, the exchange rate and the country’s reserves.

The government also has to revise its military spending and decide on a 2012 social strategy to invest in growth programs, he said. Finally, Kudrin urged spending cuts without tax increases to reduce pressure on GDP.

Kudrin said that Russia needed to create a new economic model, based not on demand spurred by oil revenues, but on private investment growth, accompanied by low inflation and a competitive credit rate.

CIS leaders sign free trade deal

The prime ministers of the Commonwealth of Independent States (CIS) member states have signed a free trade agreement, Russian Prime Minister Vladimir Putin said on Tuesday.

The agreement eliminates export and import duties on a host of goods. It also contains a number of exemptions that will ultimately be phased out.

The agreement was signed by all the CIS states except Azerbaijan, Uzbekistan and Turkmenistan.

“As a result of the long, sharp, but constructive talks we…have agreed today to sign a CIS free trade zone agreement,” Putin said earlier.

Putin stressed that the deal is “a fundamental document that will lay the groundwork for long-term relations.”

The CIS, a loose association of former Soviet republics, consists of Azerbaijan, Armenia, Belarus, Kazakhstan, Kyrgyzstan, Moldova, Russia, Tajikistan and Uzbekistan. Ukraine has not ratified the CIS Charter but participates in its activities.

The CIS has been trying to form a free trade zone since as far back as the early 1990s and held a summit in Moscow in May in which a draft agreement was presented, but there was no final signature.

Belarus, Kazakhstan and Russia formed their own Customs Union earlier this year.


Russia may limit grain exports of over 24 mln tons

Russian government will introduce a grain export duty, if exports will exceed 24 million metric tons in 2011, First Deputy Prime Minister Viktor Zubkov said on Tuesday.

“I ordered to work out and submit to the government a document, which will allow the government to introduce limits on grain export which exceeds the volume that I have mentioned (24 million tons) to make prices on the internal market stable,” Zubkov said, adding he spoke about a restrictive export duty.

Russia, once the world’s third largest grain selling nation, has exported 10.7 million tons of grain since July 1, when the authorities lifted the grain export ban imposed last August by the government scared that an abnormally hot and dry weather that destroyed over a third of Russia’s grain harvest would lead to local shortages.

Zubkov also said that the country would export 18-19 million tons by the end of 2011, if exports growth persists.

Main news of October 3


* NATO will soon complete its Libyan operation Unified Protector, the alliance’s Secretary General Anders Fogh Rasmussen said

* Britain denied it had imposed an entry ban on at least 60 Russian officials implicated in the death of Moscow lawyer Sergei Magnitsky

* Russia condemns “terrorist” acts against Syrian civilians and urges the opposition to abandon the tactics of violence and open negotiations with the authorities, the Russian Foreign Ministry sai

* A scientist awarded the Nobel Prize in medicine for his discoveries about the immune system died on September 30


* Moscow again denied any involvement in the murder of Alexander Litvinenko and challenged Britain to present any evidence to the contrary

* Russia’s ruling United Russia party denied accusations of violating electoral laws in the ongoing parliamentary election campaign

* The Russian Communist Party proposed that ethnicity be once again indicated in the passports of Russian citizens


* The Russian government will closely follow developments at the European offices of gas export monopoly Gazprom, which were searched last week by the European Union, Prime Minister Vladimir Putin sai

* Gazprom is ready to supply gas to private Turkish companies if Turkey’s state gas pipeline operator Botas terminates its gas supply contract with the Russian gas exporter, Gazprom’s export head Alexander Medvedev said

* Belarus is seeking a $400 million loan from Iran and hopes to agree a new $7 billion bailout from the International Monetary Fund, Deputy Finance Minister Vladimir Amarin said

* Kazakhstan will introduce tax breaks and subsidies for major foreign investors, the industry minister of the energy-rich Asian country said

Life on Mars Russian remake will move ’70s action from Manchester to Moscow

The catchphrase “Fire up the Lada,” could soon by sweeping Russia. The BBC has licensed the hit TV series Life on Mars, which turned actor Philip Glenister’s politically incorrect DCI Gene Hunt into one of the nation’s best loved TV characters, to be remade in the former Soviet Union and the action will be relocated from 1970s Manchester to communist Moscow.

The BBC’s announcement comes as figures from the UK Television Exports survey show that the world’s appetite for British television is booming.

The success of formats such as Strictly Come Dancing, and The X Factor as well as dramas like Downton Abbey and Sherlock have led to a 13% rise in export revenues to more than £1.4bn in the last year.

The first series of ITV1’s Downton Abbey, which recounted the trials and tribulations of servants and masters in an Edwardian country house, has now been sold to more than 100 countries around the globe. BBC Worldwide, the corporation’s commercial arm, said that Life on Mars had been licensed to Russia’s Channel One broadcaster, after similar remakes in the US and Spain.

The annual TV export report, published by the TV producers’ alliance Pact and the government trade body UK Trade Investment, shows that UK TV sales to Russia are growing faster than sales to any other country. Revenue climbed 54% to £13m in 2010. The report also showed a 20% growth in Canada and 13% in the USA for 2010 compared to the year before.

It is not yet known how in the forthcoming Russian version John Simm’s time travelling policeman character will negotiate the differences between modern day Russia and its USSR past.

London-based Valentina Shpakova, who works in Russian television, said programmes with a nostalgic edge are extremely popular with Russian viewers: “The idea [of Life on Mars] seems quite interesting, and it’s definitely not something we have on our television so far.

“We have quite a lot of programmes on Russian television looking back to the 70s and 80s talking about that era and running the music from that time”

In 2008, the American ABC network bought rights to the show and Harvey Keitel starred as the abrasive Gene Hunt. But the show was cancelled after two seasons.

While overseas production of UK formats increased from £37m in 2009 to £81m last year, exports of finished programming is a far bigger business. Revenue from ready-to-screen TV was up 15% over the year to £657m.

However the report does not represent an entirely rosy picture of Britain’s TV export scene. It claims the tendency of British commissioners to finance projects with a handful of episodes – as opposed to US commissions which can run into more than 20 episodes for a drama – is hampering development.

“The low number of episodes per run and a lack of long-running series, particularly when competing against US and Australian content, were seen to be the major obstacles to international sales,” the report said.

While US network HBO has commissioned a 13-episode run for every series of Mad Men, the BBC’s The Hour, which was seen as the British response to the US hit show, ran for only six episodes in its first series.

The report also hinted that the development of more parochial British programmes could be increasingly dumped in future in favour of more exportable products. “Growth of international sales are sometimes hindered by overly domestic content. However some programme makers are now responding to the need for series to have international appeal.”

John McVay, Pact’s chief executive, said: “Once again the UK Television Exports Survey shows strong year-on-year growth – but just as importantly – we’re seeing significant growth in new markets and territories too. These results show that the world is still seeking great formats and programmes of the quality that UK producers are renowned for.”

Nick Blair, chief executive of UK Trade Investment, added: “These figures illustrate the world-class strengths and reputation of the UK television industry and reflect the ongoing support provided by UK Trade Investment.

“Both our TV formats, like Dancing with the Stars and X Factor and finished programmes, such as Downton Abbey and Sherlock are increasingly enjoyed by audiences across the globe. The heightened demand for our programmes from emerging, high-growth economies such as Russia is particularly encouraging.”

Number crunch

Last year revenue generated by sales of UK programmes and format ideas increased to £1.4bn from £1.3bn in 2009

North America represented 42% of total UK export revenue in 2010, with Europe contributing 31% and the rest of the world 27%

The biggest buyer of UK television remains the US where sales grew by 13% to £526m in 2010 from £465m in 2009

Sales to Canada sales rose from £61m in 2009 to £73m in 2010, a 20% year-on-year increase

Selling rights to produce UK formats earned £81m last year, up from £37m in 2009

Ready-to-screen TV sold abroad in 2010 raised £657m, up 15%

Ukraine says ‘fair’ price for Russian gas is $230 per 1,000 cu m

Ukraine believes that the fair price for the purchases of Russian natural gas should be standing at $230 per 1,000 cubic meters, Ukrainian Energy Minister Yuriy Boyko told country’s TV channel Inter on Saturday.

The minister said Ukraine pays $355 per 1,000 cubic meters of gas during the third quarter of this year and the price is expected to rise to some $400 in the fourth quarter.

Ukraine, he said, is currently buying the Russian gas at a higher price comparing to other European countries and the figure of $230 was calculated in line with the price that Germany pays Russia, minus transit fees across the Ukrainian territory.

The 10-year gas export contract with Russia, signed in 2009, ties the price for gas to oil prices, which have been rising recently boosting Ukraine’s bill. Former Prime Minister Yulia Tymoshenko is now on trial for signing the deal, and Kiev is at pains to revise it.

Boyko also said that the current gas disagreements between Russia and Ukraine would not disrupt Russian gas deliveries during the coming winter like it happened in January of 2009.

Ukraine transits around 80% of Russia’s Europe-bound gas. Russia, which supplies around one fifth of Europe’s gas, briefly shut down supplies via Ukraine’s pipeline system at the start of 2009 during a dispute with Kiev over unpaid debt.

Gazprom signs option with Eni to join project in Libya

Russian gas export monopoly Gazprom and Italy’s Eni signed an option agreement, which allows Gazprom to buy half of Italian Eni’s 33 percent share in the Elephant oilfield in Libya, Eni said in a statement on Friday.

The agreement replaces a $170-million deal signed in February but suspended in April after a civil war in the African oil-rich state broke out.

Earlier on Friday, Gazprom and Eni together with Electricite de France and Germany’s Wintershall signed a shareholder agreement on the South Stream pipeline project, designed to bring Russian gas to Europe bypassing transit states.

Kiev to slash Russian gas purchases by 5 bcm in 2012

Ukraine has filed a bid to buy 27 billion cubic meters of gas in 2012 from Russia’s gas giant Gazprom after a 33 bcm bid this year, President Viktor Yanukovych said on Friday.

“We have filed a bid for 27 bcm for next year,” Yanukovych said.

Energy Minister Yuriy Boyko said last month that Ukraine, which is in a bitter row with Moscow over prices for gas, bought 40 bcm of gas this year. Gazprom said Kiev must pay for 33 bcm of gas a year regardless of actual purchases.

The 10-year gas export contract with Russia, signed in 2009, ties the price for gas to oil prices, which have been rising recently boosting Ukraine’s bill. Former prime minister Yulia Tymoshenko is now on trial for signing the deal, and Kiev is at pains to revise it.

Belarus wants to have say in Russia’s oil export duties

Minsk wants to participate in Russia’s decision making on oil export taxation as they influence the Belarusian economy, a government source said on Thursday.

Russian Prime Minister Vladimir Putin has signed a cut in crude oil export duty to 60 percent of average weighted market price and export duty rate for dark and light oil products at 66 percent of the crude oil export duty from October 1. Gasoline export duty was kept at 90 percent of crude oil as the government would like to use it to saturate the domestic market with the fuel.

“Russia sets gasoline export duty at 90 percent in oil from May 1, which in fact is prohibitive for its exports,” the source said. “Belarus under its agreements with Russia is obliged to take similar measures, although the situations in the oil industry of Belarus and Russia are different.”

Minsk intends to hold consultations with Moscow to get an opportunity to influence the export taxation policy under the Customs Union of Russia, Belarus and Kazakhstan, the source said.

“We would like the Belarusian side to also be involved in preparing such decisions because they directly affect the Belarusian economy,” he added.

Ukraine drafts 2012 budget at current Russian gas deal prices

The Ukrainian government has set the average price for Russian gas in its 2012 draft budget in line with a 2009 contract Kiev is now contesting, First Deputy Prime Minister Andrei Klyuyev told reporters on Wednesday.

“It is calculated to the formula set in the contract by (former prime minister Yulia) Tymoshenko … It will range from $414 to $416 – this is the average price,” Klyuyev said .

The 10-year gas export contract with Russia, signed in 2009, ties the price for gas to oil prices, which have been rising recently boosting Ukraine’s bill. Tymoshenko is now on trial for signing the deal, and Kiev is at pains to revise it.

“We are obliged to fulfill the 2009 contract before we agree new ones. This is why we are calculating the draft budget and all social and economic development programs as if the contract were to be fulfilled and the gas price were high,” Klyuyev said.

He reiterated Ukraine still hoped to revise the existing terms.

Kiev does not rule out going to court to renegotiate the contract, and said it would spin off production, transportation and sales units off national energy company Naftogaz, which holds the Russian gas contract, to break the agreement.

Russian grain exports may top 20 mln tons

Russian grain exports this year may exceed the official forecast of 20 million tons, First Deputy Prime Minister Viktor Zubkov said on Tuesday.

“We do not believe that 20 million tons is the limit,” Zubkov told a government meeting, adding that Russia has so far harvested 74.1 million tons of grain, two percent more than on the same date in 2009, when Russia had a bumper crop.

The harvest is on track to meet the government’s 2011 forecast of 90 million tons, enough to meet domestic needs and restore Russia’s grain export potential, which suffered from a nearly year-long export ban.

The government imposed the ban in August 2010 when drought and a relentless heat wave destroyed more than a third of the crop.

Since the ban was lifted on July 1, Russia has exported over 7.2 million tons of grain and plans to export another three million tons every month for the rest of the year, Zubkov said. Market analysts forecast Russian grain exports to total 20-23.5 million tons in the 2011/2012 agricultural year compared to 4 million tons in 2010/2011.

Zubkov also urged the Agriculture and Transport ministries to tackle infrastructure shortcomings, which have constrained export shipments.


TNK-BP plans no new oil refineries in Siberia, Russia’s Far East

Russian-British joint venture TNK-BP has no plans to build oil refineries in Eastern Siberia or the Russian Far East despite Prime Minister Vladimir Putin’s call on oil companies to build refineries in the region to reduce fuel prices, RIA Novosti quoted deputy CEO Maxim Barsky as saying on Monday.

“We have no such plans in Eastern Siberia. As for refineries, we are well represented in the central region. Our oil refinery in Khabarovsk in the Far East is being modernized, Rosneft plans to build a refinery there. I think the market will be saturated in the next five years,” Barsky said.

The government boosted gasoline export tariffs to  44 percent from May 1 to fight local shortages which started in April in some regions. Russian oil companies preferred selling gasoline abroad where prices are higher than in Russia, where the state has capped prices.

Gazprom prioritizes Yamal, Arctic shelf as Russia’s major gas projects

Gazprom will prioritize development of its gas field projects on the Yamal Peninsula and the Arctic shelf, Gazprom CEO Alexei Miller said on Thursday.

“In actual fact, we are creating another Gazprom. The creation of a new gas production center on Yamal and on the Arctic shelf is comparable with the development of the giant Urengoi, Medvezhye and Yamburg deposits during the Soviet period. Today fundamentally new gas provinces are being developed,” Miller said at an annual shareholders’ meeting.

“This year’s investment of over 1 trillion rubles is absolutely justified. It is based on the company’s existing obligations for gas deliveries in Russia and for export, the geography of reserves accessible for development, the need to upgrade and modernize Soviet-era infrastructure,” he said.

Russian Prime Minister Vladimir Putin said on Thursday that the construction of a port and a liquefied natural gas facility on Yamal would require 0.9-1 trillion rubles in investment.

No place for emotions in Russia-Belarus relations

Russian Foreign Minister Sergei Lavrov has warned that emotions should not interfere with Russia-Belarus relations.

Lavrov was speaking as Belarus paid off its $21.16-million debt to Russian energy export monopoly Inter RAO, a day after Moscow cut electricity supplies to the country.

“It is in our interests that any emotional outbursts should be removed from the public sphere, I have repeatedly talked about this with my Belarusian counterpart,” Lavrov told the lower house of the Russian parliament, the State Duma, on Thursday.

“Things are not always the way we want them to but Belarus is nevertheless our strategic partner, and we have with this partner thousands of different links on the government, corporate and, most importantly, human level,” he said.

Russian President Dmitry Medvedev was recently the subject of a barrage from Belarus’s state TV, which accused him, among other things, of offending the Belarusian people by not showing up for festivities in Brest last week celebrating the 70th anniversary of the beginning of the Great Patriotic War, as World War II is known across the former Soviet Union.

Russia responded in kind, with the pro-Kremlin NTV channel showing a derogatory documentary about Belarusian President Alexander Lukashenko.

Tymoshenko Goes on Trial

Yulia Tymoshenko kissing a supporter outside a Kiev court on Wednesday.

KIEV — Former Ukrainian Prime Minister Yulia Tymoshenko went on trial on Wednesday on charges of abuse of power in a case that has raised Western concerns over President Viktor Yanukovych’s commitment to democracy and the rule of law.

Western reaction is important since Ukraine, a major grain and steel exporter, badly needs outside investment and is negotiating a free trade deal with the European Union.

After about an hour of wrangling on Wednesday, Tymoshenko’s hearing was adjourned until Monday, July 4.

Wearing her trademark peasant-style hair braid, the 50-year-old political firebrand was in typically combative mood, accusing the judge of being in Yanukovych’s pocket and refusing to cooperate with court formalities.

Asked by Judge Rodion Kireyev to identify herself to the Kiev court, she curtly retorted: “I gave you my passport. Read it yourself.”

Tymoshenko, who lost a bitter election battle for the presidency against Yanukovych in February 2010, says the court action is part of a vendetta by her rival.

“Everything that is happening today is political revenge,” she said, denouncing the court as a “department of the presidential administration.”

“Their [the presidential administration] aim is to isolate me from being able to unite the people of Ukraine,” she said.

The prosecution says Tymoshenko, who was twice prime minister, abused her power in the signing of a 2009 gas import agreement with Russia.

It says that, without consulting her government, she forced the then-head of state-owned Naftogaz to sign the gas deal with Gazprom. Tymoshenko denies this.

The 2009 accord ended a gas-pricing dispute with Russia that had led to cuts in supplies of gas to parts of Western Europe along pipelines that pass through Ukraine.

The current administration, which took over after Tymoshenko lost her bid for the presidency in 2010, says the agreement was a sellout of national interests, though it is abiding by its terms.

Tymoshenko said over the weekend that she faced a jail term of seven to 10 years. Some close to her expect her to be given a suspended sentence, which would still limit her ability to be politically active in opposition.

A separate case is pending against Tymoshenko over purported misuse of government funds received in exchange for emission quotas sold to Japan under the Kyoto Protocol.

Since Yanukovych came to power, several of Tymoshenko’s former associates have been prosecuted on charges of offenses in office and at least one has fled Ukraine.

Western governments have not come down publicly on her side. But visiting politicians from the European Union have told the Yanukovych leadership they are concerned over the possible use of selective justice.

Tymoshenko became known as the “gas princess” in the late 1990s as owner of a company that bought and sold Russian gas.

Her fiery oratory and glamorous style turned her into an international figure in 2004 when she led the Orange Revolution street demonstrations that ultimately doomed Yanukovych’s first bid for the presidency.

She went on to serve two terms as prime minister under President Viktor Yushchenko, her Orange Revolution ally.

But early last year, with many people disillusioned by the Orange leadership and infighting between Tymoshenko and Yushchenko, Yanukovych emerged victorious in the election.

While still highly popular in many parts of the country, Tymoshenko has failed to unite other opposition politicians around her.

Russia Forces Belarus to Pay Power Bill

Cars driving past electricity pylons in Minsk on Wednesday. Inter RAO says it halted power supplies at midnight.

Russia cut electricity supplies to Belarus on Wednesday and forced the country, which faces one of the worst economic crises of President Alexander Lukashenko’s 17-year rule, to pay millions of dollars of overdue power bills.

Belarus, struggling with a balance of payments crisis that has forced it to devalue its currency, ran up arrears on electricity imports that make up about 10 percent of its power consumption.

Russian electricity exporter Inter RAO said late Wednesday that it had received payment in full from Minsk and that supplies would be resumed Thursday after it had cut power exports from midnight Tuesday.

Belarus owed 1.2 billion rubles ($43 million) for electricity supplied in March, April and May.

“We received the money,” said Inter RAO spokesman Anton Nazarov, who said exports would start early Thursday.

“From midnight, supplies to Belarus were cut to zero,” he said.

An unidentified official from Belarus’ central bank told Interfax that Minsk would pay its outstanding debts later Wednesday.

Belarus imports power, which is in some cases cheaper than domestically produced electricity, but it has enough capacity at its own power plants to meet local demand.

A Belenergo spokesman confirmed earlier Wednesday that electricity consumers would not suffer due to the shut-off of electricity imports from neighboring Russia.

The power cuts had no visible effect on power consumption in the capital, a witness said.

Deputy Prime Minister Igor Sechin insisted on Tuesday that politics had nothing to do with the electricity dispute with Minsk.

But Moscow is pushing Lukashenko, in power since 1994, to sell off assets which are being eyed by some of Russia’s most powerful business groups.

Belarus’ economic crisis has eroded Lukashenko’s power.

A poll conducted earlier this month by the Independent Institute for Socio-Economic and Political Research said Lukashenko’s approval ratings dropped from 53 percent last fall to 29 percent. The poll of 1,503 respondents had a margin of error of 3 percentage points.

Social media activists have organized a series of weekly rallies, which attracted thousands of mostly young participants clapping their hands and stomping their feet to protest the government’s economic course.

Police disbanded the gatherings in Minsk and other Belarussian cities and detained more than 450 people after last week’s rally.

Another such protest was set for Wednesday.

Trying to prevent the protests from growing, the Belarussian Defense Ministry issued a statement warning that half of those detained during the past rally were draft dodgers who will be conscripted.

The organizers of the protests braved the threats, calling on participants to show that “there are more of us than police cars can carry.”

(Reuters, AP, MT)

PhosAgro Sets an IPO Price Valuing Self at Up to $6.1Bln

Fertilizer producer PhosAgro said Tuesday that it had set an indicative price range of $13 to $16.50 per Global Depositary Receipt for a market debut it hopes will value the company at as much as $6.1 billion.

PhosAgro said it was seeking to raise at least $500 million from the London and Moscow initial public offering prior to a 15 percent over-allotment option, confirming what sources told Reuters earlier this month.

The price range is equivalent to $390 to $495 per share, the company said, giving it an equity valuation of between $4.8 billion and $6.1 billion.

Russian private companies have been lining up to float on overseas exchanges this year, particularly London, but have so far received mixed receptions as investors often baulked at the valuations sought by owners.

At least seven companies have pulled floats, with investors especially reluctant to buy existing shares sold by wealthy businessmen, rather than new shares to fund the company’s long-term growth.

The former is the case with PhosAgro, where politician Andrei Guryev is the selling shareholder of a 10 to 15 percent stake, but the company also promises to be a dividend payer.

PhosAgro’s IPO prospectus said 30 percent of net profit from the April-to-December period this year will go to shareholders, in line with chief executive Maxim Volkov’s forecast of a 20 to 40 percent payout.

Last week, Global Ports defied difficult European markets and the poor track record for Russian floats and completed a $534 million listing.

Russian companies that have successfully floated this year have raised just under $4 billion, compared with $5.5 billion during the whole of 2010.

Citi, Renaissance Capital and Troika Dialog are running the offering, which is due to be completed on July 13, while Credit Suisse and BMO Capital markets are also bookrunners.

Shares in PhosAgro, whose main export markets are South Asia, Latin America and Western Europe, are due to begin unconditional trading on July 18.

The company has secured a petrochemical firm and a bank as cornerstone investors in the offering, sources close to the deal told Reuters last week.

Vegetable Ban Is Lifted For Holland, Belgium


The country is ending a blanket ban on vegetable imports from the European Union put in place over fears of E. coli infection, starting with the Netherlands and Belgium, the nation’s top consumer rights watchdog said Tuesday.

Shipments were allowed to resume Tuesday, the agency said, following a 26-day ban intended to prevent an E. coli outbreak centered in Germany from spreading east.

Germany reported one more death in the outbreak, taking the total to at least 47, but infections have declined significantly over recent weeks.

The EU has called Russia’s ban disproportionate, and the dispute has clouded Russia’s talks on accession to the World Trade Organization.

The Federal Consumer Protection Service didn’t say when imports of vegetables from other EU nations will resume, but added that the Czech Republic, Denmark, Lithuania, Spain and Poland are on the waiting list.

Russia and the EU have reached agreement on safety certification, and agency chief Gennady Onishchenko said every shipment of vegetables must be accompanied by an individual certificate guaranteeing its safety.

Russia is the last major economy that isn’t a member of the WTO, the international free-trade body, and accession to it is crucial to a broader partnership agreement the EU wants to establish with Russia.

Onishchenko said the Netherlands and Belgium were the first to be allowed to restart shipments because there have been no cases of infection among their residents and because Russia trusts their labs. He said both nations are only allowed to send their homegrown vegetables to Russia.

Imports from the Netherlands account for about one-third of the total EU vegetable imports to Russia, he said.

He said his agency is cautious about resuming imports from Poland because in the past it had re-exported significant amounts of food from other nations.

Onishchenko added that his agency also has no immediate plan to allow the resumption of vegetable imports from Germany.

The Robert Koch Institute, Germany’s disease control center, said 47 deaths have now been reported in the country. One person has died in Sweden and officials say one death in the United States may be linked to the outbreak.

New infections have declined significantly over recent weeks but overall numbers are still rising due to delays in notification.

The disease control center says 3,901 people have been reported sick in Germany — including 838 suffering from a complication that can lead to kidney failure. A further 119 cases have been reported in 15 other countries.

The source has been traced to a sprout farm in northern Germany. It’s unclear how the sprouts were contaminated.