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Devaluation of BYR in January will require new write off of losses in economy

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April 22, 2016 19:40

As of January 22nd, 2016, BYR depreciated against the USD and EURO by more than 12%. Devaluation of the national currency is related to the fall in oil prices and weakening of the Russian rouble. Given the large proportion of Russia in Belarus’ foreign trade turnover, further dynamics will depend on the actions of the Central Bank with regard to the Russian rouble. Corporate currency loans in Belarus are likely to be revalued. Most Belarusian enterprises are likely to report losses in January due to exchange differences resulting from the revaluation of foreign currency liabilities. Importers may stop importing some goods due to unprofitability. In order to preserve budget proceeds from income tax, the government may require to list currency differences as deferred expenses, leading to distorted financial situation at enterprises, which, however, will help keep the budget revenues from significant adjustments.

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The Belarusian authorities regard the Catholic conference as yet another international event to promote Minsk as a global negotiating platform. Minsk’s proposal to organise a meeting between the Roman-Catholic Church and the Russian Orthodox Church is rather an image-making undertaking than a serious intention. However, the authorities could somewhat extend the opportunities for the Roman-Catholic Church in Belarus due to developing contacts with the Catholic world.

Minsk is attempting to lay out a mosaic from various international religious, political and sportive events to shape a positive image of Belarus for promoting the Helsinki 2.0 idea.

Belarus’ invitation to the head of the Holy See for a meeting with the Patriarch of the Russian Orthodox Church should be regarded as a continuation of her foreign policy efforts in shaping Minsk’s peacekeeping image and enhancing Belarus’ international weight. The Belarusian authorities are aware that their initiative is unlikely to find supporters among the leadership of the Russian Orthodox Church in Moscow. In Russia, isolationist sentiments prevail.

In addition, for domestic audiences, the authorities make up for the lack of tangible economic growth with demonstrations of growth in Minsk’s authority at international level through providing a platform for religious, sportive and other dialogues.

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