Elections in Belarus 2015

Belarus winning at devaluation. What happens to ruble next?

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Our country has become the champion of the CIS … in devaluation. According to BelaPAN, since the beginning of the year, the Belarusian ruble has lost more value than any other post-Soviet currency.

Why is the domestic currency the weakest among the neighbors and what are the experts’ forecasts for the near future?

It is a martial law without war. In devaluation, the Belarusian ruble this year has surpassed even the Ukrainian hryvnia.

Since the first of January, the Belarusian “bunny” has fallen one and a half times against the dollar. The currency of the war-ridden southern neighbor has lost only a third of its value. The former chairman of the National Bank of Belarus Stanislau Bahdankevich noted that if the regulator keeps the amount of money in the economy at the current level until the end of the year…

STANISLAU BAHDANKEVICH, FORMER CHAIRMAN OF THE NATIONAL BANK OF BELARUS:

“The exchange rate will not exceed Br 18 thousand per dollar. If the government does not keep to the limit, the rate may even reach 20 thousand per dollar.”

However, the devaluation has been suffered by many former Soviet republics. This has particularly affected the oil-exporting countries. The Russian ruble fell against the dollar by 16%, the Azerbaijani manat has depreciated by a third and the Kazakh tenge – by almost half. The Kazakh leader blames these processes on the global crisis.

NURSULTAN NAZARBAYEV, PRESIDENT OF KAZAKHSTAN:

“Since the beginning of this year, we have observed a general worsening of the global economic situation in the world market.”

But experts have concluded that the global crisis is no more than a myth created by the propaganda of the post-Soviet authoritarian regimes. Despite the recent disasters, the economy of the communist but still rather market-based China, has grown this year by 7%. The eurozone has shown the best growth performance since 2011, and the United States have shown the lowest unemployment rate in history. In fact, oil-exporting countries are suffering from their own overproduction of hydrocarbons, and the reason for the devaluation of the Belarusian lies mostly inside. Namely, it is the money issue.

STANISLAU BAHDANKEVICH, FORMER CHAIRMAN OF THE NATIONAL BANK OF BELARUS:

“The annual growth of the ruble money supply has been exceeded. And last month it led to the collapse of the exchange rate.”

Experts note that the narrowing of the Russian market for Belarusian exports has been compensated by the low price of the Russian gas and oil, as well as smuggling proceeds from the sale of Russian oil to the West and of the European products to the East. Therefore, the trade deficit this year is less than last year, which means less currency is flowing out of the country.

Stanislau Bahdankevich noted that although the trade balance improved, further weakening of the “bunny” is inevitable, as the economic system, which is supported by the existing authorities cannot exist without the issue of money for a long time.

Stanislau Ivashkevich, Belsat

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