Russia's Finance Ministry Suggests Limiting Loans For Belarus

Lukashenka's regime will not be able to apply for loans on a general basis.

The Russian Ministry of Finance has prepared rules that, if approved, will guide Russia when issuing government loans to other countries. Belarus, Armenia, Venezuela and Cuba will not be able to claim them on a general basis, RBC writes with reference to the documents of the Ministry of Finance of the Russian Federation.

One of the goals of granting state loans in the document is called "the formation of a positive image of the Russian Federation as a responsible international lender and donor." The economic and commercial feasibility of providing a state loan is declared as a principle. If the rules for the provision of state loans are approved, then the following states will not be considered as potential borrowers:

states in a state of military conflicts and socio-political crises;

states subject to Russian-backed UN sanctions, which impose restrictions on external funding;

states that have defaulted on their external debt obligations and have not adjusted the financial and economic situation; states classified by the Organization for Economic Cooperation and Development (OECD) in the sixth and lower groups of country credit risk;

countries with long-term credit ratings below B- (Standard & Poor's, Fitch) or B3 (Moody's Investors Service);

countries where the average cost of sovereign credit default swaps (CDS) in US dollars in the last three months for a period of ten years exceeds 800 basis points according to Bloomberg.

Afghanistan, Syria, Yemen, Libya and South Sudan are now in a state of civil war, according to the US Council on Foreign Relations. In a state of territorial military dispute - Ukraine. It is customary to refer to the frozen conflict between Armenia and Azerbaijan over Nagorno-Karabakh. An internal political crisis is unfolding in Belarus, caused by the confrontation between the people and the regime of Aliaksandr Lukashenka.

Since 2008, the Russian government and VEB.RF have provided Belarus with at least eight loans. At the end of March 2020, Minsk owed about $ 7.5 billion to the Russian government and another $ 0.44 billion to VEB on a loan for the construction of the Belarusian nuclear power plant - a total of $ 7.92 billion.