U.S. halts visas for Belarus as tit-for-tat goes on

MINSK (Reuters) - The United States has stopped reviewing Belarussian visa applications for now, its embassy in Minsk said on Wednesday, in a diplomatic spat that continues after Washington's envoy temporarily left the country.

The United States and the European Union accuses President Alexander Lukashenko of trampling on human rights and rigging polls. Washington officials have portrayed the ex-Soviet state as the last dictatorship in Europe.

Minsk this week suggested the United States cut down staff numbers at its embassy, after Ambassador Karen Stewart departed, following recommendations from the authorities that she leave.

"The U.S. government is at the moment looking at the recommendation of Belarus' Foreign Ministry for a reduction of staff at the U.S. embassy in Minsk," the embassy said in a statement.

"In connection with that review, visa reviews are temporarily suspended because our resources are directed to other priorities at the moment."

The spat began when the United States imposed financial sanctions against oil products company Belneftekhim last year, forbidding its citizens to deal with the company.

Earlier this month, Washington said it had not changed its sanctions, but Minsk disagrees. It says extending the restriction to majority-owned subsidiaries of the company amounted to new sanctions, in which case it had already threatened to expel Stewart.

The ambassador said on Tuesday Washington was ready to talk about easing sanctions if Minsk frees Alexander Kozulin, a prominent detainee who ran against Lukashenko in a 2006 poll which the U.S. and the EU said was rigged.

(Reporting by Andrei Makhovsky; Writing by Sabina Zawadzki)