Russia Update: Belarus Catches Russian Ruble Virus as National Bank Announces 30% Fee

December 19, 2014
Belarusians line up on December 19, 2014 to buy foreign currency after 30% fee imposed on exchange. Photo by Tatyana Zenkovich/EPA

Welcome to our column, Russia Update, where we will be closely following day-to-day developments in Russia, including the Russian government’s foreign and domestic policies.

The previous issue is here, and see also our Russia This Week story The Kremlin’s Policy-Making on Ukraine is ‘A Mess’ and special features ‘Managed Spring’: How Moscow Parted Easily with the ‘Novorossiya’ Leaders, Putin ‘The Imperialist’ A Runner-Up For Time’s ‘Person of the Year’ and It’s Not Just Oil and Sanctions Killing Russia’s Economy, It’s Putin.

Belarus has caught the Russian ruble virus as the National Bank has imposed a 30% fee on foreign currency exchanges, and Belarusian citizens are still lining up at banks to change their Belarusian rubles to dollars or euros.

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Website For ‘Fake’ Think Tank Now Down After Shekhovtsov Investigation Published By The Interpreter

Anton Shekhovtsov, who’s work is syndicated by The Interpreter, published an article last week about a think tank called the Center for Eurasian Strategic Intelligence (CESI), which has been pushing a “hawkish” view on Russian foreign policy. As Shekhovtsov wrote, Russian expert Edward Lucas questioned whether the CESI is a total fraud, prompting Shekhovtsov to dig further. The investigation uncovered that most of CESI’s members appear to be fake, including its CEO William Fowler.
Shekhovtsov now reports that the website, Youtube channel, and it’s CEO’s Facebook page are all down:

As you can see from below, any Google search for “Center for Eurasian Strategic Intelligence” since Shekhovtsov published his article and The Interpreter syndicated it nets a results which link back to this investigation:


This is not the only example of how writing articles about potential disinformation campaigns has been proven to have disrupted them. In a previous article we noted that after The Interpreter wrote articles examining a series of “experts” who appear on the Russian propaganda outlet RT, now many top search-engine results for those individuals prominently shows results which paint those individuals in a negative or skeptical light. In other words, the tactic of exposing and exploring pro-Russian propagandists works, and is an important method of countering disinformation.

In a more recent example, The Interpreter has published an article about another RT columnist, Bryan MacDonald. Even after MacDonald has published articles on RT, other pro-Putin media outlets, and even a paid spot in The Telegraph, a Google search for :Bryan MacDonald” features The Interpreter prominently in the search results. A Wikipedia page on MacDonald also now lists our article about him.


The tactic works, but our investigation into the  Center for Eurasian Strategic Intelligence is not over. Many questions remain concerning the identity of the individuals who started CESI and the origin of its funding.

Russian Grain Exporters Halting Purchases

Translation: Leading exporters of grain have stopped purchases for export.

Translation: Grain has remained in the warehouses, all the deliveries have halted. Russia has virtually stopped export.
Russian Magazine Prices Go Up

Translation: Magazines have gotten 20-25% more expensive.

St. Petersburg Book Store Refuses to Sell Book on Siege Due to Nudity

St. Petersburg’s Dom Knigi [House of Books] has refused to sell a book about the Siege of Leningrad during World War II due to the cover art, which “may offend the feelings of survivors of the blockade.”

Translation: The main store of St. Petersburg has refused to sell a book about the blockade. The book is “Living Pictures” by Polina Barskovaya.

The drawing, titled “Masks and Women” was made by Pavel Zaltsman, an
artist who himself survived the siege.

“The publisher’s
representatives especially chose this drawing because they believed that
it best conveys the mood of the book.”


Russian ‘Mistral’ Sailors Return To Russia Empty Handed
Russian sailors are finally leaving France — but they’re not leaving with any French-made Mistral amphibious assault ships:

AP/Atlantic Council reports:

A top French official involved in negotiating the sale in 2009, former Defense Minister Herve Morin, is now opposed to it. His change of heart reflects Europe’s evolving relationship with Russia, a powerful neighbor, trading partner and energy supplier. . . .
Morin, who took part in the negotiations in 2009-2010, told The Associated Press, “Some were for and against around the table. In the end, Sarkozy arbitrated, saying: ‘We do it.'”

Today, Morin admits he has changed his mind. “It was a political gesture when we signed the deal, it is a political gesture, too, when we deliver it”  or not, he said.

The deal has become a liability for Sarkozy’s Socialist successor Francois Hollande. In August he put it on hold, saying “conditions haven’t been met” to deliver the ship. In November he said formalized the suspension “until further notice.”

Hollande still hasn’t taken a definitive decision on the contract that was supposed to be the biggest arms sale by a NATO country to Russia. . . .

Opposition Leader Alexey Navalny’s Final Speech at His Trial

The following is a translation by The Interpreter of the final speech of Alexey Navalny at his trial today. The verdict is expected January 15, 2014; prosecutors have asked for 8 and 10 years respectively for Navalny and his brother, Oleg.

Translation: The prosecutor asked for 8 years for Oleg Navalny, 9 for Alexey, but taking into account the sentence in the Kirovoles case, they will add another year – for 10. Standard regimen [labor colony].

Translation: Prosecutors who asked for the Navalnys 8 and 10 years. Left – Rozova, right – Ignatova.

Navalny’s speech:

How many times in his life can a person who has not done
anything illegal give his last speech? In the last 18 months, this is my sixth
or ninth final speech. It seems as if the last days are beginning. All of you
— judges, prosecutors, plaintiffs — look at the table when talking to me. You
all say, ‘But Alexey Anatolevich, but surely you understand everything.’ I
understand everything, I understand that that you will not jump up, nor
will the Yves Rocher representative stand up and say, ‘You have convinced me.’
No, I understand that people are constructed differently. No one will tell his
family today, ‘I put in jail an obviously innocent person, and now I have to
live with that.’ I understand, that I’ll hear, ‘But surely you understand’ or
“but why did he go after Putin…’

My words concern those who do bad things or ignore what is
going on. My words are so that you admit that you shouldn’t tolerate lying
about everything. I am told that the interests of Russians in Turkmenistan
don’t exist, but for the sake of the interests of Russians in Ukraine, a war
had to be started. I’m told that no one steals at Gazprom. I bring documents,
I’m told — that doesn’t exist. I say that we are prepared to run in the
elections and convince you, we are making a party. And you don’t let us into
the elections and say, ‘But we won.’

The more a person contributes to lying, the more lying he
encounters. Lying has become the essence of the state. Yesterday, Putin spoke
and said, ‘We have no palaces!’. But we have been photographing three of them a

Why put up with this lying? Why look at the table? Life is
too short to look at tables. I didn’t manage to look around and I’ve already
turned 40. Soon I will have grandchildren. No sooner will we look around than
we’re in bed, and people are looking at us and saying, ‘Let him free up the
living space quicker.’ We can only be proud of the moments when we can honestly
look each other in the eyes, when we are doing something worthy.

This is a fairly sick situation. And it is a cunning, sick
format that the Kremlin has chosen where it doesn’t simply put me in jail but
tries to drag in more people: [Co-defendant in previous lumber case Pyotr] Ofitserov,
the father of five children — and his wife — I have to look in the eyes. I have to admit that: yes, they hook me with this,
when they still drag in other innocent people to boot. But even the taking of
hostages does not stop me. Life has no point if you put up with lying. I will
never agree with the system built in this country. It is constructed so as to
rob everyone who is in this room. It is a real junta.

I don’t regret for a section my actions aimed at the fight
with corruption. [My lawyer Vadim] Kobzev told me, ‘Alexey, they will
definitely put you in jail, because you get in their way so much that they
won’t put up with it!’ He has predicted evil! But you can’t live with the
thought, ‘oh, they’re going to put me in jail.’ I realized that. But I don’t
regret it and will call on people to realize their right to freedom of
assembly, among others.

And people have the lawful right to rise up against the
junta which has grabbed everything. We have allowed them to rob us and turn us
into cattle. What have they paid us for this, what have they paid you, who are
looking at the table, for this? Do you schools? No. Do you have health care?
No. Roads? No. Some kind of salaries for the jury? No, you are being robbed
every day. I can’t go on tolerating this. I will go on standing as long as is
necessary, here, at the cage, or inside it.

My brother didn’t intend to get involved in politics. there
is no need to aggravate this. Taking hostages doesn’t stop me, but what do the
authorities get out of killing them? I call on absolutely everyone. It may
sound naive, and it is common to snicker at this but – ‘Live not by the lie.’

I thank everyone for their support and call on them to ‘live
not by the lie.’ They isolate me, they will jail me, another will come. I
didn’t do anything that was unique.”

“Live not by the lie” was a saying started by the
Russian writer Alexander Solzhenitsyn, author of The Gulag Archipelago, August 1914 and
other works, as a strategy for living under the Soviet government.


— Catherine A. Fitzpatrick

Navalny Sentencing Scheduled for January 15

Translation: Sentence on January 15 at 10:30 am.

NATO Policing Baltic Airspace
In light of Russia’s new threat to eastern Europe, NATO is increasing its patrols of the Russia border, but it’s also increasing its publicity to remind both the public and the Russian government of their presence.
Belarusians Line Up at Banks to Exchange Rubles

The Belarusian currency has lost a third of its value, the BBC Russian Service reports today.
The government ordered a temporary 30% fee on the purchase of foreign
currency by legal and physical persons and now there is a rush to buy
foreign currency.

Businesses will pay this fee when purchasing foreign currency on the
stock market and citizens will pay it in the form of a commission in
banks; the funds thus obtained will be sent to the state budget, the
National Bank of Belarus has explained.

The government issued a statement today, according to (translation by The Interpreter):

Proceeding from the situation forming in the economies of adjacent states, and first of all in the Russian Federation, the government and National Bank have taken a number of measures aimed at not allowing the development of negative trends in the currency and financial markets and raising the attractiveness of savings in Belarusian rubles.

All major Belarusian banks have been ordered to introduce immediate
guaranteed savings accounts with indexation of ruble savings when the exchange rate of the Belarusian ruble changes.

This is to protect savings in the Belarusian currency from exchange rate risks and make them more attractive for savings by contrast with foreign currency, says

Trade on the currency market outside of the stock market has been halted, says the BBC.

Starting today, a 50% fee has also been imposed on foreign currency profits coming into the country.

The government has recommended that banks not allow their loan portfolio in Belarusian rubles to grow before February 1, 2015 and not to exchange currency in debts to creditors.The controls previously placed on the amount of loan interests have been removed.

The National Bank has called on people not to panic and is promising people to keep the situation under control, says the BBC. says the measure essentially bans loans in rubles, and customers will no longer be able to change the foreign currency of their deposits, for example, from the ruble to the dollar.

Experts believe the imposition of the fees is a hidden devaluation which will lead to a further fall in the value of the ruble and a black market in currency exchange. The measures were induced by the rush to buy foreign currency after the Russian ruble fell. 

Lines have already begun to appear at banks, but not as long as in 2011, before the devaluation of the Belarusian ruble. Some exchange booths have run out of foreign currency.

Belarusian dictator Aleksandr Lukashenka has been very cautiously
critical of Russia’s war on Ukraine, and offered Minsk for peace talks
among leaders from Ukraine, Russia and the Russian–backed separatists,
mediated by the Organization for Security and Cooperation in Europe

But Belarus is tied to Russia not only in the Customs Union, but
the Union of Belarus and Russia, a vague political association which has
facilitated trade and and visa-free travel between Belarus and Russia
but which did not lead to a unified currency.

Russia relies on Belarus to export gas through the Yamal pipeline
which runs through Russia and across Belarus and Poland to Germany.

Russia has also increasingly moved troops and armor into Belarus
which is feared to serve as a staging ground for military activity in

— Catherine A. Fitzpatrick