Updated at 18:18,16-07-2018

Russia may abolish oil duty for Belarus in exchange for adequate compensation


Russia may abolish its export duty on oil and petrochemical products supplied to Belarus in exchange for adequate compensation, Russian Deputy Finance Minister Sergei Shatalov told reporters in Moscow on Friday.

"If everything goes well, we will consider this matter [the abolition of the duty] within the framework of a common economic zone in 2012 on condition that adequate compensatory measures are proposed," Russias news agency RIA Novosti quoted Mr. Shatalov as saying.

"Otherwise, we will be simply subsidizing the Belarusian economy," the deputy minister said.

Earlier, Russias authorities repeatedly said that the duty would be scrapped as soon as the two countries established the common economic zone with Kazakhstan within the framework of the Customs Union to embark on a deeper integration.

Belarus is in dispute with Russia over the customs duty levied on deliveries of crude oil and petrochemical products since January 1, 2010. This past March, the Belarusian authorities applied to the CIS Economic Court, saying that international agreements concluded within the CIS and the Eurasian Economic Community, as well as bilateral agreements between Belarus and Russia "provide for duty-free trade."

On October 8, the Court upheld Minsk`s request and recommended that the Belarusian and Russian governments "consider the possibility" of a temporary ban on the Russian duty. It is scheduled to resume its hearing on the suit in January 2011.