Government adopts de-dollarization plan

The Council of Ministers and the National Bank have adopted an action plan for the de-dollarization of the national economy.

“The Council of Ministers and the National Bank have adopted the action plan for the de-dollarization of the national economy in pursuance of the order by the head of state,” NBB deputy head Syarhey Kalechyts said at a meeting of the NBB board on Tuesday.

According to Mr. Kalechyts, the plan includes measures aimed at reducing the share of foreign-currency payments in the country.

Most of the measures are expected to be carried out in 2017 and 2018.

“Their unconditional implementation will contribute to the further strengthening of trust in the national currency,” Mr. Kalechyts said. “The slowdown in inflation processes, higher revenues from rubel deposits in comparison with foreign-currency deposits and the stable situation in the currency market testifying to lower currency risks in the country create a favorable environment for this.”

Another deputy head of the NBB, Dzmitry Kalechyts, said that the degree of dollarization of the economy remained high.

“The share of Belarusian banks’ foreign-currency assets amounted to 61.7 percent by the end of 2016,” Mr. Kalechyts said. “As of January 1, 2017, the share of individuals’ foreign-currency deposits with banks was 76.3 percent.”

According to Mr. Kalechyts, the NBB recommended that banks gradually reduce their interest rates on foreign-currency deposits in order to make savings in the national currency more attractive.

Independent economists say that the NBB is trying to increase its influence on the currency market in the country by de-dollarizing banks’ portfolios.

“For the National Bank to have a greater influence on the inflation rate, there should be an efficient interest rate policy,” economist Anton Boltachka told BelaPAN. “In the current situation, the NBB’s interest rate policy is not efficient enough because banks’ loan portfolios mainly consist of low-interest loans carrying fixed interest rates and foreign-currency loans.”

The share of Belarusian banks’ rubel loans issued on market terms reportedly amounts to only about 15 percent.