Belarus will obtain EDB third tranche thanks to joint efforts by Finance Ministry and National Bank

September 12, 2016 10:23
Фото/Image: Reuters

Thanks to the Finance Ministry bonds sales and net currency supply on the domestic market, Belarus’ gold reserves grew up to USD 4.7 billion. In order to obtain the third tranche from the Eurasian Development Bank, Belarus had to have at least USD 4.3 billion in the international reserves as of September 1st, 2016. Sales of the Finance Ministry bonds and restrictions on lending to the economy by the National Bank are likely to help Belarus to meet the requirements for obtaining the third and the fourth tranches from the EDB loan.

According to the National Bank, on September 1st, 2016, Belarus’ international reserves totalled USD 4.7 billion and increased by USD 82 million over the month. The gain in international reserves was due to the currency net supply on the domestic foreign exchange market at circa USD 220 million and due to the sales of the Finance Ministry bonds.

According to the USD 2 billion loan agreement with the EDB, signed in March 2016, Belarus had to preserve her international reserves at a particular level, which prompted the Government and the National Bank to implement some measures. According to the agreement, as of September 1st, 2016, Belarus’ international reserves should be at least USD 4.3 billion. Should she fail to meet this requirement, the third tranche of the loan (USD 300 million) would not be disbursed. In August 2016, the total amount of debt due by Belarus was over USD 1 billion. Without additional funds, the international reserves could drop below USD 4 billion.

In August 2016, the Finance Ministry placed four issues of currency bonds for legal persons and individuals at rates ranging from 5.5% to 5.9% per annum for a total of USD 480 million and one-year maturity period. To achieve sustainable net currency supply on the domestic market, the National Bank carried out a tight monetary policy and almost stopped issuing soft loans for housing construction for the population. The debt on bank loans to various economic sectors has not increased since early 2016. Thanks to all these measures, the international reserves have not dropped below the threshold value and Belarus is very likely to receive the third tranche from the EBD totalling USD 300 million. In addition, Belarus may as well meet the international reserves’ projected target for January 1st, 2017.

Overall, Belarus has met the challenge and preserved her international reserves higher than USD 4.3 billion. Thanks to restrictions on lending to the economy and on soft construction loans, Belarus has good chances to preserve the reserves’ growth and to meet the projected targets for January 1st, 2017.

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The Belarusian authorities have launched a discussion on the moratorium or abolition of the death penalty under the pressure of Belarusian human rights activists and international community. Apparently, the authorities are interested in monitoring public sentiments and response to the possible abolition of the capital punishment. The introduction of a moratorium on the death penalty would depend on the dynamics in Belarusian-European relations, efforts of the civil society organisations and Western capitals.

In Grodno last week, the possibility of abolishing the death penalty in Belarus or introducing a moratorium was discussed.

The Belarusian authorities are likely to continue to support the death penalty in Belarus. During his rule, President Lukashenka pardoned only one person, and courts sentenced to death more than 400 people since the early 1990s. Over the past year, Belarusian courts sentenced to death several persons and one person was executed.

There are no recent independent polls about people’s attitude about the death penalty in Belarus. Apparently, this issue is not a priority for the population. In many ways, public opinion about the abolition of the death penalty would depend on the tone of the state-owned media reports.

That said, the Belarusian Orthodox Church and the Roman-Catholic Church stand for the abolition of the capital punishment, however their efforts in this regard only limit to public statements about their stance. Simultaneously, the authorities could have influenced public opinion about the death penalty through a focused media campaign in the state media. As they did, for example, with the nuclear power plant construction in Astravets. Initially unpopular project of the NPP construction was broadly promoted in the state media, and eventually, according to independent pollsters, was accepted by most population.