EU reaches deal on Belarus economic sanctions, according to Austria, diplomats

[Rogue Valley]

EU reaches deal on Belarus economic sanctions, according to Austria, diplomats

The European Union is set to ban new loans to Belarus after reaching a deal on Friday for economic sanctions on Minsk as punishment for forcing down a flight to arrest a journalist, the Austrian foreign ministry and three diplomats said.

www.reuters.com

6/19/21
BRUSSELS/VIENNA, June 18 (Reuters) - The European Union is set to ban new loans to Belarus after reaching a deal on Friday for economic sanctions on Minsk as punishment for forcing down a flight to arrest a journalist, the Austrian foreign ministry and three diplomats said. Broad economic sanctions would be the EU's strongest response yet to the forced landing of a Ryanair flight in May by Belarusian authorities to arrest an exiled dissident, a move the bloc's leaders have called state piracy. Restrictions on the Belarusian financial sector, if agreed by EU governments at a political level, will include: a ban on new loans, a ban on EU investors from trading securities or buying short-term bonds and a ban on EU banks from providing investment services. EU export credits will also end. Friday's agreement overcame objections from Austria, whose Raiffeisen Bank International is a big player in Belarus through its Priorbank subsidiary. "With this agreement the EU is sending a clear and targeted signal against the Belarusian regime's unbearable acts of repression," the Austrian foreign ministry said in a statement.

EU experts tasked with drawing up sanctions agreed on a ban of exports from the bloc of any communications equipment that could be used for spying, and a tighter arms embargo to include hunting rifles. They also agreed restrictions on EU purchases from Belarus of tobacco products, as well as oil and oil-related products, and a ban on importing potash, a major Belarusian export. There will be exemptions in the financial sanctions for humanitarian purposes, while private savings of Belarusian citizens will not be affected, one of the diplomats said. EU governments now want to hit sectors that are central to the Belarus economy, to inflict real punishment on Lukashenko. Exports of potash - a potassium-rich salt used in fertilizer - are a major source of foreign currency for Belarus, and state firm Belaruskali says it produces 20% of the world's supply. The EU statistics agency said the bloc imported 1.2 billion euros ($1.5 billion) worth of chemicals including potash from Belarus last year, as well as more than 1 billion euros worth of crude oil and related products such as fuel and lubricants. Germany has said sanctions should continue until Belarus holds free elections and releases political prisoners.

The sanctioning of potash exports will inflict real pain on Belaruskali, a Belarus state-owned company and probably the world's largest exporter of potash fertilizer.

It is profits from state-owned industries such as Belaruskali and the Minsk Tractor Works (MTZ) that fund the Lukashenka regime.