Belarus May Need IMF Help on Top of Russia Loan, UniCredit Says

By Jack Jordan

Belarus may need a $2.5 billion International Monetary Fund loan package to help cover its external financing gap after the country’s foreign reserves plunged, according to UniCredit SpA.

The eastern European country devalued its currency, the ruble, on March 29 by 8 percent, according to UniCredit calculations, as part of a strategy to reduce a current-account deficit equivalent to 15.6 percent of gross domestic product last year. It is also seeking a $3 billion bailout loan from Russia and former Soviet partners to plug its financing gap.

“The loss of 20 percent of the central bank’s foreign- exchange reserves since the start of the year (some $1 billion) comes amid an uncertain external financing profile,” Dmitry Gourov, an emerging-market strategist at UniCredit in Vienna, wrote in the note. In addition to funding from Russia and the Eurasian Economic Community, “there is a high chance that an IMF package will be requested in the second half,” he wrote.

Belarus received an IMF bailout loan of $3.5 billion in 2009 to shore up its economy after the global financial crisis caused investors to flee emerging markets. The program expired last year. Belarus has not applied for new funding from the IMF, according to the note.

To contact the reporter on this story: Jack Jordan in London at

To contact the editor responsible for this story: Gavin Serkin at


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