Zlotnikov not Exclude Possible Restrictions on Purchase of Foreign Currency

22.06.2011 11:58

Belarusian economist Leonid Zlotnikov considers it unlikely to introduce a ban on foreign currency sale to the public in Belarus. According to the expert, such situation is triggered by the restrictions on the fx rate value on the domestic market.

According to Leonid Zlotnikov, limiting exchange rate has led to negative consequences, including Belarusian commodity export, which, in turn, had to be limited by administrative methods, reports «European Radio for Belarus

«In addition, our enterprises and businesses can become insolvent through low fx reserves. This means that businesses will not be able to receive pre-paid raw materials and components, which has a negative impact on the economy,» says Leonid Zlotnikov.

Among other adverse effects, the economist noted the decline in international reserves and, consequently, an increase in debt to foreign partners. As an example, Leonid Zlotnikov recalled the situation with Russian energy supplies.

It’s more Profitable for Belarus to Pay off Debt to Russia, Zlotnikov

As the expert explained, the volume of electricity purchased in Russia is around 5% of all electricity consumed by Belarus. Russian electricity costs are cheaper for Belarus than its own production, so in the event of supply cutoff the country will have to spend more financial resources on its production. But this, according to Leonid Zlotnikov, is more profitable for Belarus than to increase the debt to Russia.

Leonid Zlotnikov also did not rule out the possibility of the authorities’ paying off the debt to Inter RAO ($50 million) through funds allocated from the Anti-Crisis Fund. Belarus has been recently listed the first tranche of $800 million.

«From the economic point of view, we’d better pay the debts. Then Belarus would continue to consume cheaper Russian energy and, consequently, spend less money on it, than generate its own energy resources,» said the expert.