BELARUS NEWS AND ANALYSIS

DATE:

27/10/2008

IMF says to meet top Belarus officials this week

MINSK, Oct 27 (Reuters) - An International Monetary Fund mission said on Monday it would hold talks soon with top Belarussian officials, who have asked the fund for a $2 billion cushion against the impact of the global financial crisis.

The talks with the ex-Soviet state follow a preliminary agreement between the IMF and Ukraine on a $16.5 billion standby loan and a "substantial financing package" with Hungary. Iceland and Serbia are amongst others who have turned to the Fund.

"The IMF mission has only just begun its work. We have planned meetings with the head of the central bank, with the finance and economy ministers and the deputy prime minister in the next two to three days," an IMF official said.

Belarus, traditionally close to Russia both politically and financially, has taken tentative steps towards Western investors in the past year, selling some state assets to European firms and planning its debut Eurobond.

That issue had to be postponed due to poor market conditions as the credit crunch spread across the globe.

Although officials say the crisis has not hit Belarus directly, the country has a large proportion of debt that is short-term -- 60 percent of a total of $14 billion.

It is also spending central bank reserves to prop up the Belarussian rouble currency, which is pegged to the dollar. Reserves have dipped to $4.9 billion in September from $5.6 billion.

Aside from delaying the Eurobond issue, Minsk also postponed its privatisation projects this month, denying the budget further revenues. It has already agreed on a $2 billion loan from Russia, which supplies Belarus with most of its gas needs.

The economy grew a robust 8.1 percent last year and authorities have pencilled in a target of 8-9 percent this year. (Reporting by Andrei Makhovsky, writing by Sabina Zawadzki; editing by Stephen N

Source:

http://www.guardian.co.uk/business/feedarticle/7933410

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