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Belarus seeks billions from the IMF

December 1, 2015

Minsk is considering economic reform in exchange for a possible $3 billion loan from the IMF, Belarus officials say. The deal would offer better value than the usual bids from Moscow, according to President Lukashenko.

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Russland Weißrussland Lukaschenko bei Putin
Image: Getty Images/AFP/Ria Novosti/S. Guneev

Belarus strongman Alexander Lukashenko said he was open to reforms while talking to representatives of the International Monetary Fund (IMF).

"I didn't say no to them on any point. Not on the tariffs, not on the pension age, not on wages," he said at a government meeting on Tuesday. Lukashenko did not provide details on possible restructuring of the former Soviet state.

An IMF delegation visited Belarus in November to negotiate with the government. At the end of the 12-day trip, the international institution said the two parties had made "considerable progress in discussing a set of policies" related to IMF funds.

Competing with Kremlin

The government is now seeking a credit of $3 billion (over 2.8 billion euro) over ten years, which could have a 2.28 interest rate, according to Prime Minister Andrei Kobyakov. President Lukashenko described the conditions as "favorable."

"Nobody is giving us loans under such terms, not even the Russians," Lukashenko said. The signal to the IMF comes just weeks after Lukashenko dashed hopes of economic restructuring at his fifth inauguration ceremony.

Free market reforms could spark "a revolution or a civil war," Lukashenko said at a time, referring to the raising of the retirement age and canceling publicly financed medical care and education.

Troubled by Soviet heritage

Belarus is burdened by inflation and a declining GDP, with foreign debt reaching $12.5 billion in early October. The eastern European country received a $3.5 billion loan from the IMF in 2009-2010.

The government controls about 80 percent of the national economy, which relies heavily on trade and energy imports from Russia.

dj/jm (AP, Interfax)