April 18 – April 24, 2011

Moratorium on issuing

The situation has not changed
Moratorium on issuing

In order to stabilize the financial and economic situation in the country, Belarus is introducing a moratorium on the adoption of new state programmes funded via emission.

Government and the National Bank are planning to optimize the government’s expenditure in 2011 with a ceiling of the deficit rate maximum 1.5% of the GDP.

In addition, as of 20 April, the discount rate of the National Bank increased from 12 to 13%.


With the obvious deterioration of the situation the National Bank is making sound attempts to restrict the money supply and reduce demand through increased borrowing costs. If the Ministry of Finance and the National Bank preserve the agreed positions and tightened policies, the pressure on markets will be reduced and the demand for rubles and dollars will decrease as well. However, as a result the GDP will drop and many enterprises operating on concessional loans only will go bankrupt. So far it is not clear how tough the policy will be and how long it will last under the pressure of the relevant ministries and local authorities.

At the same time, the moratorium says nothing about the ban on crediting of emission to fund the state programmes that have already been approved (there are over a hundred of them), and when a company cannot be funded from own resources or commercial loans.

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Once a week, in coordination with a group of prominent Belarusian analysts, we provide analytical commentaries on the most topical and relevant issues, including the behind-the-scenes processes occurring in Belarus. These commentaries are available in Belarusian, Russian, and English.

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