By Yevgeny Nikonov
On April 1st, 2011, the National Bank abolished the 30-day Rouble reservation requirement for acquiring foreign currency on the stock exchange (introduced earlier). As before, banks are able to purchase foreign currency more promptly — one working day prior to bidding. The purposes of the transaction are taken into account, with funds needed to pay for medicine and natural gas given priority, alongside credit repayments in foreign currency.
Financial analyst Alexander Mukha sees this as a positive signal, showing that the situation on the domestic currency market is improving. He notes that the stock market has already rallied, intensifying applications for currency purchase. The first step has been taken in calming the feverish demand for Dollars and Euros by the Belarusian population.
The Head of the National Bank, Piotr Prokopovich, promises, “As long as I’m Chairman of the Board, there won’t be any one-time devaluation, even by five percent.”
The National Bank plans to raise its gold-and-currency reserves to $10bn this year and won’t reduce them anymore, creating a reliable safety cushion for the country’s economy. Additionally, $1bn is soon to be attracted from the Russian Government and $2bn from the EurAsEC Anti-Crisis Fund. These new loans will settle the currency market. However, the major problem remains: to combat the negative trade balance for goods and services. “Everything now happening on the currency market comes from the imbalance of exports and imports,” explains Mikhail Kovalev, the Dean of the Belarusian State University’s Economic Department.
The volume of exported goods and services needs to be rapidly increased, with the Government planning to balance foreign trade by 2014. From 2015, it hopes for a surplus of $500m. To achieve this goal, the National Export Promotion Programme for the coming five years envisages the creation of new, export-oriented manufactures while increasing the share of high-tech and science-intensive products with high value added. Commodity and geographical diversification of export sales should be also stimulated.