Belarusian President Aleksander Lukashenko has ceded land in the capital Minsk to construction companies linked to controversial Serbian family Karic, new publication says Organized Crime and Corruption Reporting Project (OCCRP) investigation.

The investigation revealed that Zomex Investment, a company linked to the Karic family, and two affiliated companies, Dana Astra and Belinte Robe, have been allocated more than 400 hectares of land in the Belarusian capital with a value of around 1 billion dollars.

Land registers viewed by OCCRP journalists show that the three companies have at least 11 ongoing projects in and around Minsk, making them the city’s biggest developers.

According to OCCRP, construction is now “one of the most profitable enterprises in Belarus” and, over the past decade, it has become the domain of private enterprises rather than state enterprises.

Specifically, according to the survey, “most of the benefits of this boom went to just three companies: Zomex Investment, Dana Astra and Belinte Robe.”

Until the end of 2020, all three companies were owned by Dana Holdings, a company registered in Cyprus, which until recently was owned by Nebojsa Karić, son of the businessman and former presidential candidate Bogoljub Karić.

However, days before the EU blacklisted Dana Holdings in December 2020, the holding company was removed from its role as owner of the three property development companies and replaced by a company registered in the United Arab Emirates called Enterprise Developments Holding Limited, OCCRP said.

A lucrative relationship

According to the OCCRP, the Serbian Karić brothers benefited from their relationship with Belarusian authoritarian leader Lukashenko, who has ruled the country since 1994. The report states that this relationship has been “very lucrative”; he notes that Zomex’s net profit for 2019 was over $ 35 million and that under an agreement with the Minsk government, Zomex does not pay tax on its profits.

Ties with the Belarusian president date back to the mid-2000s, when the Karic’s political rivals began investigating their businesses and Bogoljub ultimately fled Serbia for a decade.

Bogoljub Karic (profiled by bne IntelliNews) is a household name in Serbia, where green salads are sometimes nicknamed “Bogoljub’s salad” because of its promises to rebuild Serbian production, using green salad as an example of a Serbian product.

Together with his three older brothers (Zoran, Dragomir and Sreten) and his sister Olivera, Bogoljub Karic owns the conglomerate BK Group, which operates in Serbia, Russia and Belarus, and is mainly involved in construction.

The BK group was founded in Serbia in the 1990s, when the country was under the control of the late dictator Slobodan Milosevic. He accumulated a series of firsts, founding Serbia’s first mobile network Mobtel, the first dial-up internet provider EUNET, one of the first private banks in Serbia, Karci banka (later Astra banka), the TV channel private BK TV and the first private university. , BK University.

However, the “BK empire” quickly fell victim to Karic’s bitter personal rivalry with former finance minister and central bank governor Mladjan Dinkic. At the end of 2001, Astra banka was placed under central bank receivership for making secret payments to members of the Karic family.

Prosecutors accused the Karićs of taking unfair advantage during MiloÅ¡ević’s reign, although charges were subsequently dropped, and five members of the Karic family were placed on EU travel ban lists .

Karic used his financial clout and his status as the owner of a popular TV channel to fight Dinkic, before entering politics in 2004.

A former wedding singer, Karic successfully presented himself as a down-to-earth family man, becoming extremely popular among the poorest rural Serbs, but that was not enough to win him in the 2004 presidential elections. After his defeat – he was ranked third – Dinkic and other government officials overtook Karic, and he left Serbia for Moscow in 2006, a decision that was to last a decade. During his absence, several indictments were brought against him, although nothing was proven in court.

Ten years later, when the statute of limitations against him finally expired, Karic landed in Belgrade on December 30, 2016 as a free man with an estimated net wealth of $ 750 million.

During Bogoljub’s exile, his wife Milanka and his brother Dragomir were elected to the Serbian parliament. In 2009, Dragomir Karic invited Lukashenko to an economic forum in Kapaonik, Serbia. The following year, Dragomir was appointed to lead the construction of the city of Minsk, which was taken over by Dana Astra the following year.

When Lukashenko visited Serbia in 2019, he told a press conference that he remembered welcoming the Karić brothers to Belarus and hailed Dana Astra’s success.

OCCRP reveals that President Lukashenko’s daughter-in-law Lilia Lukashenko was listed in company documents in 2017 as one of Dana Astra’s deputy directors. A spokesperson for the Karićs told OCCRP that she was no longer working there.

Dana Holdings board chairman Vibor Mulić denied to OCCRP that the Karić had a special relationship with Lukashenko.

Great plans never made

The OCCRP investigation also revealed that Zomex (recently renamed Emirates Blue Sky) failed to deliver on the big plans of several large-scale projects.

According to the OCCRP, many projects “followed the same pattern: big promises and generous government support for ambitious plans that never materialize. Despite the repeated failures of the companies to deliver the ordered projects, they continue to obtain contracts.

Among them, the Minsk Lighthouse, an ambitious project awarded following an architectural competition in 2008. But unlike the futuristic design, 12 years later only high-rise block buildings have been built.

Dana Astra has been allocated 300 hectares of land – most received by any company in Belarus – by a presidential decree in 2014 to develop the mixed-use Minsk World, which was supposed to include the construction of an international financial center to attract foreign investors to Belarus. The land was worth around $ 800 million, and Dana Astra also secured tax breaks and access to city resources to build infrastructure for development, according to OCCRP.

OCCRP reported that Minsk World condos are financed by “residential bonds”, namely the purchase of unfinished homes in exchange for a large discount, below market value. Many Minsk World bonds have been purchased by BPS-Sberbank, OCCRP said. In 2020, the subsidiary of the Russian financial giant Sberbank had bought residential bonds valued at $ 140 million of Zomex, equal to almost half of the company’s assets.

As part of a separate agreement, Zomex received 78 hectares of land worth $ 80 million to build residential housing at Chaluskincau Park.