MINSK (Reuters) - Ex-Soviet Belarus on Sunday holds a presidential election certain to return strongman Alexander Lukashenko for a fourth term despite troubled ties with chief benefactor Russia.
The mustachioed Lukashenko, 56, has ruled the country of 10 million and its command economy since 1994, thanks to cheap Russian energy and the transit tariffs from Russian oil and gas flowing through Belarus to Europe.
Relations have soured and Moscow is reining in the subsidies, while Lukashenko tries to woo the West. The precarious balancing act looks set to dominate his next five-year term.
Here is a profile of Belarus:
-- The Belarus economy is underpinned by its energy relationship with Russia, which exports some 20 percent of its gas shipments to Europe through it western neighbor.
But Russia has hiked gas prices for domestic consumption, and cut back the valuable flow of tax-free crude oil to Belarussian refineries, effectively limiting the amount Minsk is able to refine and re-export in a major blow to state coffers.
-- Lukashenko has used billions of dollars of Russian money to prop up heavy industry and social spending, but analysts say his budget may shrink by a third in 2011 because of the dwindling Kremlin subsidies, leaving the export-focused economy more vulnerable to external demand for its products.
-- This year's budget deficit is expected to be 3 percent of gross domestic product (GDP), double the original forecast, and is seen staying at that level in 2011.
-- The IMF helped Belarus through the global crisis with a $3.5 billion package, the last tranche deposited in April 2010. The IMF expects the economy to grow 7.5-10 percent in 2010 after stagnating in 2009, but wants Lukashenko to move forward with promised fiscal, banking and structural reforms.
-- A former state-farm boss, Lukashenko has ruled Belarus with an iron fist since 1994, jailing opponents and muzzling independent media while offering generous welfare and pensions to his citizens on the back of Russian subsidies.
-- Ten years into his rule, a referendum lifted the two-term presidential limit, allowing Lukashenko to run again. But his third term has seen a gradual deterioration in ties with Moscow and an apparent attempt by Lukashenko to woo the West and shake off the title of the "last dictatorship in Europe."
-- Belarus has joined the European Union's Eastern Partnership initiative and resisted Russian efforts under Prime Minister and former president Vladimir Putin to reintegrate the post-Soviet sphere around Moscow. Personal relations between Lukashenko and Putin have become acrimonious.
-- The EU has lifted a travel ban on Lukashenko, while the government has freed a number of opposition activists, but analysts say there has been little of substance in terms of political liberalization or economic reform. Brussels says the election must be free and fair.
-- A media campaign this year in Moscow against Lukashenko has some observers wondering whether Russia is trying to force him from power. But this carries the risk of Belarus drifting into the West's embrace under a new leader.
* GEOGRAPHY, PEOPLE:
-- Belarus borders three European Union members -- Lithuania and Latvia to the north and Poland to the west -- and ex-Soviet Russia and Ukraine to the east and south.
-- Ethnic Belarussians account for 81 percent of its 10 million people, with minorities including Russians (11 percent), Poles and Ukrainians. The majority is Orthodox Christian.
(Writing by David Cutler, London Editorial Reference Unit, and Matt Robinson; Editing by Maria Golovnina)