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No extraordinary financing currently required in Belarus

Credit service reform

By Vladimir Khromov

No extraordinary financing currently required in Belarus

According to experts, Belarus will finish 2014 with economic growth and a well-calculated balance of payments for 2015. Prime Minister Mikhail Myasnikovich noted during his meeting with the IMF Mission, “Undoubtedly, we’ll work with the IMF, as it’s vital — especially for our international image and regarding support for our outlined structural reform, which we are implementing with the National Bank.”

IMF Mission representatives in Government
IMF Mission representatives in Government

Belarus believes that future work with the IMF, via the country programme, will raise the volume and scale of structural reform, while reducing implementation time. Concrete content is vital for Belarus’ relations with the International Monetary Fund. In 2009 and 2010, Belarus received $3.4bn as part of the IMF standby programme, with $3.14bn paid back. “We’ll repay the entire sum on schedule,” stressed Mr. Myasnikovich. “We honour all our commitments, including those agreed by predecessors, even under conditions of global crisis.”

The Prime Minister underlined that, among other things, these figures prove the ability of the Belarusian economy to secure sustainable development and to repay its debts. “Our economy is noticeably growing — albeit at a slow pace. We are repaying our old commitments thanks to the actions of our President, and the efforts of the Government, the National Bank, and the management of our enterprises,” he added.

The Head of the Government described the new approaches being used to finance and implement state programmes and the IMF Mission was able to see that they had been improved. The share of subsidised lending in the Belarusian economy is gradually being reduced.

The Head of the Government informed the IMF Mission about steps to reduce cross-subsidy, and the consistent implementation of structural reform. “We’ll consistently implement what we have set out to do,” stated Mr. Myasnikovich.

The IMF Mission, led by the Deputy Head of the Office for Northeastern Europe of the European Department David Hofman, arrived in Belarus to study feasibility for a new country programme. Belarus has been honouring its obligation to repay its IMF standby loan, having paid 54.7m SDR (about $81.7m) on October 23rd, as one of its regular instalments. Most of the principal sum has been repaid, with the final transfer due in 2015.

Between January 2009 and April 2010, Belarus used its IMF loan of $3.5bn to secure positive dynamics across several economic and monetary management indicators.

From 1992-2008, Belarus tapped into IMF resources twice: $217m from the Systemic Transformation Facility and $77m via the standby lending mechanism. In February 2005, Belarus fully repaid these loans.

IMF activities in Belarus aim to work with the Government and the National Bank in preparing economic policy programmes, focusing on taxation, budgeting, monetary management, the exchange rate and trade policy, promoting considerable economic growth, low inflation and a stable balance of payments.
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