New Belarus economy minister urges liberalisation

MINSK, Dec 22 (Reuters) - Belarus needs to speed up liberalisation and privatisation of its economy if it hopes to reach the ambitious 11-13 percent growth pace forecast for next year, the country's new economy minister said on Tuesday.

Nikolai Snopkov, appointed in an early December government reshuffle, said the largely state-run economy needs to reform quickly.

"It is necessary to attract capital from the world's largest brands and international corporations," local agencies quoted Snopkov as saying at a government meeting. "The privatisation process did not accelerate in 2009."

Belarussian President Alexander Lukashenko sacked the previous economy minister along with trade and tax ministers on Dec. 4 in an attempt to end the economic stagnation that took hold in the ex-Soviet republic in the second half of this year, after years of robust growth.

Official figures showed the Belarus economy still growing in the first half of this year despite the steep global downturn.

The economy in Belarus is still run along Soviet lines and economists said the government had pressed companies to keep producing goods they could not sell as demand and prices for their machinery, agricultural and chemical products plummeted in their main markets, Russia and Europe.

Gross domestic product contracted 0.4 percent in January-November, with officials hoping for stagnation at best at the year's end.

The government has turned to international financial organisations for aid.

On Dec. 19, the International Monetary Fund disbursed a fourth tranche of a $3.63 billion stabilisation loan, urging the government to continue with structural reforms and prudent policies.

Snopkov said that following the liberalisation of most retail prices Belarus introduced at the end of October, the government should also abandon producer price regulation.

"The existing system of administrative price control, disregarding certain increases and liberalisation, is a problem for conducting business," Snopkov said.

The International Monetary Fund (IMF) expects the Belarussian economy to grow 1.8 percent next year after a 1.2 percent contraction in 2009, and the budget deficit is seen at $1 billion.

Belarussian Finance Minister Andrei Kharkovets said on Monday the government's forecast of 11-13 percent growth in gross domestic product terms is "an ambitious programme," but added that the government took a very conservative approach regarding economic growth in planning its 2010 budget .

(Reporting in Minsk by Andrei Makhvosky, writing in Moscow by Lidia Kelly; Editing by Ruth Pitchford)


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