Russia escalates dispute with Belarus after [potash company] CEO’s arrest – by Timothy Heritage (Reuters U.S. – August 30, 2013)

MOSCOW – (Reuters) – Russia banned pork imports from Belarus on Friday, stepping up a diplomatic and trade war over the arrest of a Russian businessman and threatening to deepen the isolation of its former Soviet ally.

Russia is one of Belarus’ few diplomatic backers after 19 years of authoritarian rule by President Alexander Lukashenko but has responded furiously to the arrest this week of Vladislav Baumgertner, head of Russian potash company Uralkali.

Baumgertner was seized on Monday at the airport outside the Belarussian capital Minsk after being invited to talks with the prime minister, and then humiliated by television footage showing him being searched in his prison cell.

Since then, Russian officials have announced a 25 percent drop in oil supplies to Belarus in September, threatened to extend the cuts for several months and hinted at possible restrictions on imports of Belarussian dairy products.

Russia’s veterinary regulator said the restrictions on hog and pork product imports had been imposed over concerns about African swine fever in Belarus and would not be lifted until the virus was wiped out or brought under control.

The moves could deal a significant blow to Belarus, a transit country for Russian oil and natural gas to Europe. Its economy, already in danger of collapse, is heavily reliant on agriculture and Russian oil supplies.

“Relations between Russia and Belarus seem to be delving to new lows and the expectation is that Russia will further ratchet up pressure on its neighbor via the trade channel,” said Timothy Ash, an analyst at Standard Bank in London.

“All this comes as the economy in Belarus looks precariously fragile.”


The dispute followed the collapse this month of a Russia-Belarus sales cartel that controlled two-fifths of the $20-billion global market for potash, an ingredient used in mineral fertilizers.

In a sign that the breakup of the joint venture with Uralkali is causing problems for Belarus, a senior official at state potash producer Belaruskali said it had suspended two of its four potash mine complexes for maintenance.

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