US embassy cable - 05MINSK1452

C O N F I D E N T I A L MINSK 001452 
 
SIPDIS 
 
SIPDIS 
 
DEPT FOR DRL/IL BOB HAGEN, EUR/UMB 
 
E.O. 12958: DECL: 09/07/2015 
TAGS: ELAB, PHUM, PGOV, BO 
SUBJECT: MOTOVELO WORKERS GO ON STRIKE 
 
 
Classified by Charge Constance Phlipot for Reasons 1.4 
(B,D) 
 
1. (C) Summary: Workers at a Minsk motorcycle plant went on 
strike on November 25 demanding the factory pay their 
October wages.  After blocking a large highway for one and 
a half hours, the factory administration finally agreed to 
pay the wages by November 30.  While on a regional trip, an 
angry President Lukashenko told reporters that the strikers 
should work harder if they wanted to earn their wages.  The 
factory's administration blamed the pay arrears on 
bureaucracy and the former director's poor decisions. 
Sources from the ILO and Perspektiva disagreed, explaining 
that the factory, which is employee-owned but under 
temporary government control, is almost bankrupt because of 
its uncompetitiveness and bad management. End Summary. 
 
 
The Protest 
----------- 
 
2. (U) On November 25, workers at the Motovelo bicycle and 
motorcycle plant went on strike.  Two hundred workers, who 
had not received their October and part of their September 
wages, congregated outside the factory's entrance.  After 
being ignored by the administration, the strikers moved 
onto one of Minsk's busiest thoroughfares, Partizansky 
Avenue, and formed a human chain that blocked traffic for 
one and a half hours.  The workers demanded the management 
pay back wages and blamed factory directors for the 
company's poor performance, the impeding large-scale 
layoffs, and its expected bankruptcy. 
 
3. (U) At 15:00, the factory directors and regional 
administration promised to pay the workers by November 30 
if they ended the strike.  The workers exited the street, 
but did not return to work and vowed to continue the strike 
if wages were not paid as promised. 
 
4. (SBU) Poloff witnessed the end of the demonstration, 
though it was difficult to reach since the police had 
closed most entrances onto Partizansky.  Only 50 people 
remained outside Motovelo's entrance when Poloff arrived 
and the street soon opened for traffic.  BKGB presence was 
visible, but minimal and the only police present were 
guiding traffic. [Comment: Usually OMON riot police and 
units of BKGB, who outnumber the protesters two to one, 
break up unsanctioned demonstrations even when they are not 
blocking traffic.  At Motovelo, the OMON remained in their 
buses in nearby courtyards.] 
 
5. (U) One television crew was filming, but it was unknown 
whether it was state-media or independent.  Independent 
news source Charter-97 reported that plain-clothes officers 
did not permit news crews onto the scene.  Other rumors 
circulated that the Minsk bureau of the Belarusian-Russian 
Mir broadcasting company refused to transfer video footage 
that day, fearing that foreign TV channels would show 
footage of the strike.  An employee at Mir, Sergei 
Nemchenok, denied the allegations and claimed that a notice 
was issued in advance that routine maintenance of the 
bureau's equipment would take place on that date. 
 
The President's Angry Response 
------------------------------ 
 
6. (U) While on a visit to the Gomel region, President 
Lukashenko publicly condemned the Motovelo strike, claiming 
he would not tolerate such actions and had no patience for 
it.  According to Lukashenko, Motovelo is a private company 
owned by the workers, yet they want the government to save 
them. [Note: Motovelo is currently under "temporary" 
government control via the Golden Share policy.  See para 
9.] Lukashenko stated that the GOB would help the company, 
but since it belongs to the workers, they must answer for 
its economic status.  The President demanded that the 
strikers return to their work building bicycles and 
motorcycles, earn their wages, and think about ways to work 
better rather than rebelling in the street.  The President 
announced that he would soon implement measures to take 
over the factory. 
 
A Word From the Motovelo Administration 
--------------------------------------- 
 
7. (U) Motovelo Director Vladimir Kluchnikov told reporters 
on November 28 that the situation at the factory remained 
complicated and tensions were still high.  He also opined 
that the workers do not understand what they are doing when 
they strike.  However, management is working to pay the 
promised salaries and is in negotiations with the bank to 
settle its debt to the workers.  In a November 28 press 
interview, Motovelo's technical director Aleksei Odintsov 
announced that wages would be paid by November 30 and 
blamed bureaucracy for the wage arrears, not the 
management.  Motovelo's administration faced problems with 
the bank, not because the factory has no money, but because 
the factory's level of trade is calculated every three 
months.  He added that the factory's debt to the workers 
was a result of decisions made by the previous director. 
 
Motovelo and Working Conditions 
------------------------------- 
 
8. (U) Although Odintsov denied the wage arrears were due 
to the company's poor economic standing, he later admitted 
that Motovelo did not make a profit in 2005.  Shareholders 
did not receive dividends and all profits went to pay off 
the company's debts.  The first Deputy PM Vladimir Semashko 
announced on November 28 that Motovelo's debt to the state 
budget was USD 395,000, to the Minsk budget Q USD 558,000, 
and had an energy debt of USD 1200.  However, in his 
opinion everything was fine at the factory.  The average 
wage is USD 200 and the company hopes to boost sales by 
forming an economic partnership with China in the near 
future. [Comment: This does not seem a realistic 
expectation given China's production is usually more 
competitive than Belarus'.] 
 
9. (U) Odintsov admitted that due to falling sales, layoffs 
were the only option for the company's future.  Odintsov 
claimed neither he nor the director of Motovelo own shares 
in the company, therefore decisions are not made for 
personal interest or gain.  According to Odintsov, the 
workers wanted higher wages in September, but there was not 
enough money to do so.  The director refused the raises and 
the workers got angry.  Therefore, the GOB took control of 
Motovelo under the Golden Share rule and supported the 
director's decision.  To date, the workers are still not 
satisfied with their wages. 
 
What Unofficial Sources Had to Say 
---------------------------------- 
 
10. (C) In a November 28 phone conversation with the 
International Labor Organization reporting officer in 
Minsk, Natalya Varishagina, Poloff learned that Motovelo is 
in dire financial condition.  The bicycles and motorcycles 
it produces are not competitive due to their high costs and 
low quality.  Workers are promised USD 140 per month, but 
only if they meet their sales quota.  Since they are unable 
to meet these quotas, the workers are making only USD 107. 
The workers' union at Motovelo, which is a branch of the 
pro-government Federation of Trade Unions of Belarus, 
failed to address the concerns of the employees to the 
administration.  According to Varishagina, the workers had 
had enough and declared a strike. 
 
11. (C) On November 30, Perspektiva leader Anatoliy 
Shumchenko told Poloff that a Motovelo worker called to 
inform him that the strike began.  [Comment: Shumchenko 
highlighted that the strikers did not contact the 
opposition leaders or even the independent labor unions, 
indicating to him that these organizations do not have the 
strong support among the people that he does.]  Shumchenko 
immediately contacted the independent press and rushed to 
the factory before the police closed the street.  With the 
streets closed, no one could access the factory, including 
reporters.  The police tried to persuade the workers to get 
out of the street, but were afraid to push the angry mob. 
Shumchenko claimed that the strikers were blaming 
Lukashenko directly for their problems because he had 
nominated the current director of Motovelo who subsequently 
bankrupted the company. 
The Result 
---------- 
 
12. (U) On November 29, Motovelo paid all wage arrears.  On 
November 30, the management promised employees that they 
would take steps to revive the plant's economic standing. 
Ivan Sinitsa, chairman of the plant's trade union committee 
claimed that similar promises had been made and unfulfilled 
in the past.  A Motovelo informed independent news source 
Belapan that GOB and law enforcement officials attending 
the management-employee meeting and threatened the workers 
with "harsh" penalties should they strike again.  On 
December 1, the Belarusian Prosecutor's Office filed 
charges against Motovelo's administration for violating 
labor legislation and its untimely wage payment. 
 
Comment 
------- 
 
13. (C) The Motovelo strike was the largest Minsk has seen 
since the market vendors gathered in October Square in 
February.  If Shumshenko's opinions are correct, Lukashenko 
saw how his support, despite the control he has on the 
media and civil society, could end if Belarusian workers 
are not satisfied with their pay, or lack there of. 
 
PHLIPOT