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Record Achieved!

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Record Achieved!

Belarus’s foreign debt is approaching 17 billion.

While government officials are developing a strategy for reducing Belarus’s debt to other countries and international financial institutions, and the IMF gives us advice on how to do it better (see “IMF Recommendations: Budget Adjustment, Wage Restriction, and Plan B”), the national debt continues to grow, the Economic newspaper writes.

However, for ten months of the current year, i.e. from the beginning of the year, according to the Ministry of Finance, the external debt of our country increased by only 42.7 million USD (taking into account exchange differences), but that did not prevent it from setting an absolute record for the entire time of independence, stopping at 16.8 billion USD. Basically, this “achievement,” which is not at all encouraging, is caused by the acquisition of the sixth tranche of the Eurasian Fund for Stabilization and Development (EFSD) in the amount of 200 million USD, which we had been seeking for so long. It “ate” the decline in public debt from the beginning of the current year by 183.0 million USD, or 1.1%, which was achieved in September.

Naturally, the total debt of Belarus, which the main financial institution counts in Belarusian rubles, grew as well. In January – October, it reached 45.1 billion BYN, or nearly 22 billion USD, after 44.6 billion BYN for the first nine months. Just do not divide this amount by the number of people in our country, including old people and babies, which some economists regularly do – the figure you’ll get will be too ill-favored.

We’d rather have a look at the expense of which sources the external debt of Belarus has been formed this year. In total, we managed to raise about 2 billion USD, of which 37% came from the government of Russia and its banks, about 16% – from the banks of the People's Republic of China, and 10% – from the Eurasian Foundation for Stabilization and Development, where the “main violin” is Russia. Thus, almost 63% of all the debt is generated by two countries or their banking institutions. And only 37% fall on eurobonds and other sources.

This is the danger that the IMF warns us about in the above article: diversification is required not only for export, but also for financial borrowing.

USD 279.5 million was additionally raised in October this year, and only USD 46 million was redeemed, two thirds of which went to Russia.

As for the domestic debt, it “froze” at around 9.6 billion BYN, but at the same time, from January 1 of this year, its amount has increased by almost 400 million BYN, or more than 4%.

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