Belarus’s Currency Reserves Cover One Month’s Imports, RBS Says

By Agnes Lovasz

Belarus’s foreign-currency reserves cover about one month of imports and the former Soviet Republic may be forced to devalue its currency as it looks to neighboring Russia for aid, Royal Bank of Scotland Group Plc said.

The central bank of Belarus has lost about 60 percent of its convertible foreign-currency reserves since October, at about a pace of $500 million per month, Timothy Ash, head of emerging-market research at RBS in London, wrote in an e-mailed note today, citing his calculations based on central bank data.

International reserves stood at $4.02 billion at the end of February, according to the central bank’s website. That leaves it with $2.73 billion of liquid currency stockpiles, which is “concerning,” Ash wrote.

“Time is running out and additional financing sources need to be found quickly,” according to Ash.

Belarus requested aid from Russia and some other former Soviet partners after Standard & Poor’s cut Belarus’s debt rating on March 15, citing increased “external vulnerability.” A $3.5 billion loan provided by the International Monetary Fund in 2009 during the global financial crisis has expired.

There is “little prospect of a new financing program from the IMF given western governments would likely block such a program amid concern over developments on the political front, such as the arrest of opposition supporters,” Ash wrote.

The country of 10 million was dubbed the “last dictatorship in Europe” by the administration of former U.S. President George W. Bush. President Alexander Lukashenko, who has ruled Belarus since 1994, was returned to office for a fourth term in December with almost 80 percent of the vote.

The Organization for Security and Cooperation in Europe said the election was neither free nor fair and the regime has intensified its crackdown on the opposition, arresting more than 700 people.

The reduction in reserves may necessitate a devaluation of Belarus’s ruble of between 20 percent and 30 percent, Ash has estimated.

To contact the reporters on this story: Agnes Lovasz in London at;

To contact the editor responsible for this story: Willy Morris at


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