BELARUS NEWS AND ANALYSIS

DATE:

12/01/2007

Russia, Belarus in talks over removing trade restrictions

MOSCOW, January 12 (Itar-Tass) - A new round of protracted Russian-Belarussian talks over removing restrictions in mutual trade began in the government building here on Friday.

Initially, the Prime Ministers of the two countries, Mikhail Fradkov and Sergei Sidorsky, met at 10:30, Moscow time, for a one-hour one-on-one meeting, and then the delegations of the two states jointed them, the government press service told Itar-Tass.

Taking part in the negotiations for Russia are Minister of Economic Development and Trade German Gref, his deputy Vitaly Savelyev, Finance Minister Alexei Kudrin and his deputy Sergei Shatalov, and Minister of Industry and Energy Viktor Khristenko.

The Belarussian negotiators include Deputy Prime Minister Andrei Kobyakov.

The parties are expected to work out specific proposals to resolve the disagreements between the two countries within the framework of the Customs Union without exemptions or restrictions, including the shipment of Russian oil.

The talks lasted more about 15 hours on Thursday. They began at the Russian Ministry of Economic Development and then moved to the government house on Krasnopresnenskaya Embankment.

The main problem - the resumption of the transit of Russian oil via the pipelines located in Belarus has already been resolved, because the Belarussian government annulled the transit duty on Wednesday.

Belarus imposed the transit duty on Russian oil on December 31, under which it charged Moscow 45 dollars per each ton of oil pumped through the territory of the republic, an unprecedented decision in world practice.

On January 1, the resolution by the Russian government imposing an export duty on oil shipped to Belarus in the amount of 180 dollars per ton, came into effect.

The measure was a response to Belarus' unilateral withdrawal from the regime of the division of duties on petroleum products, made of Russian oil, which the republic had been exporting to Europe.

As a result, the Russian budget fell short of 3.5 to 4 billion dollars a year during three and half years.

On January 6, "an oil crisis began" in Russian-Belarussian relations. It was caused by Belarus' beginning unsanctioned tapping of Russian oil as payment of the transit duty.

On January 8, the Russian company Transneft stopped oil shipments, to prevent the siphoning of the Russian oil by Belarus.

Belarus' actions affected Russia's European partners receiving oil through the export pipeline Druzhba /Friendship/, including Hungary, Germany, Poland, Slovakia and the Czech Republic.

On January 10, Belarussian President Alexander Lukashenko phoned Russian leader Vladimir Putin. After the conversation, the two presidents instructed the governments to work out a range of measures by Friday to settle the dispute.

On Wednesday evening, the Belarussian Council of Ministers annulled its decision on the imposition of the transit duty, and Russia began to pump oil through Druzhba overnight to Thursday.

Slovakia, the Czech Republic, Hungary and Germany later confirmed that they were receiving Russian oil.

Gomeltransneft Druzhba reached the optimal regime of pumping Russian oil to Europe on Thursday afternoon.

At present, it pumps some 10,000 tons of oil an hour, company director general Alexei Kostyuchenko told Itar-Tass.

Its daily throughput capacity therefore may reach 230,000 to 240,000 tons.

Russia, in accordance with its export schedule, planned to pump through Druzhba 15.5 million tons of oil to the west in the first quarter of 2007.

Source:

http://www.tass.ru/eng/level2.html?NewsID=11151182&PageNum=0

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