Aleksandr Lukashenko hears out report of NBRN chief Nadezhda Yermakova

    On 23 July President of Belarus Aleksandr Lukashenko met with Chairperson of the Board of the National Bank of the Republic of Belarus (NBRB) Nadezhda Yermakova to receive her report.

    The President was informed about the situation in Belarus' foreign currency market.

    The President drew attention to the crediting of the economy and the implementation of national programs. "I see the dynamics. The refinancing rate is decreasing. This is right. We must proceed with it. It is good for the state and economy, and, consequently, for people. Therefore, we should keep it up,” Aleksandr Lukashenko said.

    The head of state was also interested in the dynamics of people's depositis.

    The President reminded that he had ordered earlier to examine the operation of subsidiaries and branches of foreign banks in Belarus. “How are foreign banks operating in your view? I got information that foreign banks are acting totally like foreign agents. Entrepreneurs had complained that financial records of very many companies are copied and sent to some customers. I checked it. It is true. Therefore, some time ago I asked you to look into the issue. What should be done in this regard? Do I need to interfere?” Aleksandr Lukashenko asked.

    Aleksandr Lukashenko noted that foreign banks coming to Belarus should contribute to Belarus’ economic growth, not simply take part in lucrative projects. “Banks with foreign capital, mainly Russian capital, operate on the Belarusian market and provide loans to the economy,” Nadezhda Yermakova said.

    According to Nadezhda Yermakova, the situation in the foreign currency and finance sectors is calm. Since early 2012 the National Bank has bought foreign currencies in the equivalent of $1.8 billion.

    Companies are actively selling foreign currency. “Of all the money sold at the foreign exchange, 55% is mandatory sale and 45% is voluntary sale. It means companies are interested in selling foreign currency revenues and putting them into use,” the National Bank chief said.

    Since the start of the year households have sold over $600 million on the net basis. At the same time, in recent months the purchase of foreign currency by households has been on the rise. “In May people sold as much foreign currency as they bought. In June and July the purchase of foreign currency has exceeded its sale. It is attributed to the increase in household income and the summer season prompting people to buy foreign currency to spend holidays abroad,” Nadezhda Yermakova said.

    As was reported to the head of state, the current refinancing rate of 31% allows building up and maintaining the profitability of deposits in the national currency, yet discourages from large-scale borrowing. The refinancing rate is gradually decreasing, and this process is linked with other indicators in the economy.

    With regard to inflation, Nadezhda Yermakova said: We are keeping a finger on the pulse. We are regulating liquidity, and keeping the refinancing rate at a level which discourages the inflation growth.

    According to Nadezhda Yermakova, the inflation did not exceed the 2012 projections in H1. “We do not see any prerequisites that could worsen things. As long as there are no external factors. First and foremost, I am speaking about Europe and about paying capacity and purchasing power of our enterprises and our sales markets. We will see how things will turn out. We do not expect any additional inflation caused by factors that depend on us,” Nadezhda Yermakova underlined.