The Belarusian economy’s main problem is the low level of international reserves, Marek Belka, director of the International Monetary Fund (IMF)’s European Department, said when meeting with Belarusian Prime Minister Syarhey Sidorski in Minsk on Tuesday.
Mr. Belka said that this is the "most burning issue." The low-level reserves "constitute a danger to the stability of the country," he warned.
"This is the main focus of the IMF`s program for Belarus that ends early next year," he said. "This is the underlying theme of discussions with [National Bank] governor Prakapovich and [Finance] Minister Kharkavets. We discussed it from different points of view. We discussed it from the point of view of the credit flow and its impact on the reserves outflow, as well as fiscal policy and its impact on domestic demand and reserves."
"In general, we are satisfied with the main flux of the economic policy pursued by the Belarusian government," Mr. Belka said.
On August 18, an IMF team began a two-week mission in Belarus to hold consultations on the country’s economic performance and prepare a second review that will be used by the IMF Board of Directors for deciding whether or not to give Belarus a new tranche of a $3.52-billion stand-by loan.
Mr. Belka said that the consultations focus on long-term issues of the Belarusian economy, in particular efforts to continue the high rate of economic growth that the country had in the pre-crisis period.
According to Belarus’ official statisticians, the country’s international reserves increased by $512 million in July to $3,161.9 million. The increase was due to a $680-million tranche that Belarus received from the IMF on July 2 under its stand-by loan arrangement.
The calculations were reportedly made according to the International Monetary Fund`s Special Data Dissemination Standard. The reserves increased by $100.8 million in the first seven months, said the National Statistics Committee.
