Belarus and Russia row over potash raises fear of a trade war
The prospect of a trade war between Russia and one of its neighbours loomed larger yesterday after Belarus ratcheted up the rhetoric against the Kremlin and hinted at further arrests of executives working for Russia's biggest fertiliser company.
Tensions have been rising since Monday when the chief executive of Russia's Uralkali fertiliser group was arrested in the Belarus capital of Minsk. His arrest was particularly shocking as he had just arrived in the country on the invitation of its prime minister.
The executive, Vladislav Baumgertner, was held on suspicion of "abusing his power" in Uralkali's dealings with the Belarusian state-owned potash mining company. Uralkali last month announced it was quitting an export cartel it had with the Belarusian business, sending global potash prices plummeting.
The Belarusian government, led by the so-called "last dictator of Europe" Alexander Lukashenko, claims the withdrawal has caused about $100m (£64m) in damage to the country's economy.
Outraged at the arrest of Mr Baumgertner, Moscow said it would scale back oil exports to the country and cast doubts over the quality of Belarusian dairy exports to Russia. Both statements were seen as a veiled threat of some form of sanctions.
Unbowed, Belarus yesterday declared its investigators had enough grounds to launch a criminal case against Uralkali's biggest shareholder, the Russian billionaire Suleiman Kerimov, as well as a number of Belarusian nationals.
Belarus Investigative Committee spokesman Pavel Traulko suggested the possible charges against Mr Kerimov were obvious, saying to Russia's Itar Tass news agency "no special knowledge of law is required" to understand them.
However, typically in this opaque dispute, he declined to give any indication what the allegations might be.
Similarly foggy was Mr Traulko's admission Mr Baumgertner had been "arrested". This week the official Belarusian line has been that the Russian executive had been "detained", not arrested.
Analysts say the Kremlin may hold back its response to Belarus's provocations because the Kremlin is attempting to woo Ukraine to join the customs union it has with Kazakhstan and Belarus. Ukraine is hoping to join the EU while also warming up frosty relations with Moscow.
Previous rows between the two countries have seen Russia ban Belarusian dairy imports and cut off gas supplies in 2009 and 2010 respectively.
On Wednesday, Russia declared nearly a third of Belarusian dairy products were no longer of high enough quality to comply with Russian health standards.
Russia accounts for half of Belarus's imports and two-fifths of its exports.
Mr Baumgertner pulled the plug on the cartel, known as the Belarusian Potash Co, after Minsk passed a law allowing itself to sell potash in side-deals outside the joint venture.
The spat has been good for the world's farmers, as the price of potash is expected to dive by as much as 40 per cent. Analysts say that could trigger a surge in demand from Indian and Chinese farmers, leading to bumper harvests in the coming years.
Lukashenko: 'Europe's last dictator'
Nothing comes to pass in Belarus without the say-so of its president, Alexander Lukashenko, above.
The man who started as a humble agricultural worker is known by many in the West as Europe's last dictator. He has been in power since 1994 and leads a bizarre regime featuring human rights abuses and homophobia. The death penalty is still administered with a bullet to the back of the head and he is banned from travelling to most Western countries.
Belarus is forced to rely on Russia for trade and subsidies, making this recent spat seem all the more unfathomable.
Malaysia Airlines plane crash exposes alarming flaw in airline security: over one billion flights made last year without stolen-passport check
Teacher shows sex tape featuring herself to pupils during class by mistake
David Cameron resorts to paying for Facebook fans because not enough people like him
Malaysia Airlines Flight MH370: Oil slicks in South China Sea ‘not from missing jet’, officials say
Swarm of killer bees sting woman 1,000 times
Britain's top vet sparks controversy with call for ban on slashing animals' throats in 'ritual' slaughters for halal and kosher meat products
If you're horrified by a flame-roasted dog, you should be shocked at a hog roast
Poor 'live like animals' says Boris's privately educated sister after going on 'poverty safari'
Exclusive: Impact of immigrants on British workers ‘negligible’
Vince Cable: Teachers 'know absolutely nothing' about the world of work
Ukraine crisis: Russia pledges to 'retaliate against sanctions' as Ukrainian president says Crimea vote will not be recognised
- 1 International Women's Day 2014: The shocking statistics that show why it is still so important
- 2 Australian man Rod Sommerville reacts to bite from deadly snake by reaching for cold beer
- 3 Singapore sting: Sky-high prices are pushing locals to the edge of affordability
- 4 Teacher shows sex tape featuring herself to pupils during class by mistake
- 5 David Cameron resorts to paying for Facebook fans because not enough people like him
iJobs Money & Business
£32000 - £36000 per annum + generous benefits: Pro-Recruitment Group: * TAX * ...
£55000 - £70000 per annum + benefits: Pro-Recruitment Group: In-House Corporat...
£80000 - £100000 per annum + benefits: Pro-Recruitment Group: In-House Opportu...
£30000 - £35000 per annum + generous benefits: Pro-Recruitment Group: Mixed Ta...