BELARUS NEWS AND ANALYSIS

DATE:

15/12/2008

Imf, Belarus Start Second Round of Talks on $2 Bln Standby Loan

MINSK. Dec 15 (Interfax) - An IMF mission will hold the second stage of talks with the Belarusian authorities on December 15-19 on a $2 billion standby loan, Interfax was told at the IMF office in Belarus.

The mission held the first stage of the talks on the terms of disbursing the loan on October 27 through November 22, though initially the talks were supposed to end on November 6.

IMF Resident Representative in Russia Neven Mates will head the mission the same as during the first round of the talks. Most other mission members will also remain on the team, a spokesman for the office in Belarus said.

Belarus appealed to the IMF for a standby loan in mid-October saying it needed a safety cushion to neutralize the impact of the world financial crisis on the national economy and financial system.

The main problem for Belarus today is the growth of net demand on the domestic currency market stemming from the growing foreign trade deficit which leads to the reduction of forex reserves and threatens the stability of the national currency. Even though a $1 billion stabilization loan from Russia was added to the forex reserves on November 18, the reserves shrank by $276.4 million or 6.8% in November to $3.775 million, according to IMF standards, given interventions on the domestic currency market by the National Bank.

The IMF is linking the standby loan to the fulfillment of several recommendations aimed at stabilizing the balance of payments and budget of Belarus.

Source:

http://www.istockanalyst.com/article/viewiStockNews/articleid/2883681

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