National Bank’s plans for growth in gold reserves in 2017 could derail

Russia will refinance Belarus’ debt worth USD 750-800 million in 2017. The National Bank projected an increase in the gold reserves by USD 500 million in 2017 up to USD 5.4 billion. This plan could be derailed due to public debt servicing costs in 2017 at USD 3.5 billion. Belarus expects a positive decision on the EEU loan tranche and an increase in the oil supply, which due to oil prices on the world market could ensure additional USD 492 million from oil export duties to the Belarusian budget. The NB would refinance domestic liabilities in foreign currency by issuing new bonds for a one-year period. The National Bank is also likely to preserve the positive balance of currency purchases on the domestic market. The fact that Russia would refinance Belarus’ debt makes the IMF loan not so urgent. However, if offered, Belarus would not reject the IMF loan so as she has fulfilled most IMF requirements and requires a safety cushion for the coming years.