Russia grants Belarus delay in debt payment

Belarus and Russia agreed on the refinancing of Belarus's government debt payments that Minsk is to make in 2015.

The statement was made by prime minister of Belarus Andrei Kabiakou in Minsk on Thursday, Interfax reports.

“We have agreed with Russia that we will refinance our payments that we are to pay Russia in 2015 within the framework of the interstate debts and the EurAsEC Anticrisis Fund,” he said.

The PM noted that “the agreement was reached and the decision was made; we are at the last stage of discussion now”.

“Russian partners agreed to refinance the amount we pay Russia in accordance with our debt obligations,” the prime minister said.

As Aliaksandr Lukashenka said in early April, Belarus was discussing the refinancing of the government debt with Russia.

“We hold negotiations over the debt refinancing. I think we will reach an agreement,” Lukashenka said.

He noted that Belarus could perform its obligations without refinancing the debt. “Our budget allows us to pay $2-3 billion this year,” he noted.

Russia gave Belarus a loan of $110 million at LIBOR+1% at the beginning of April. Belarus is expected to pay the loan from 2019 to 2025 in two tranches a year (in February and August).

As of January 1, 2015, the government debt of Belarus was 197.5 trillion Belarusian rubles, which is 25.4% of GDP. The external debt was $12.6 billion (19.2% of GDP). A year ago, the government debt was 23.7% of GDP, including an external debt 18.2% of GDP.

In 2015, Belarus has to pay $4bn of its external debt, of which $3bn is principal payments and $1bn is debt service payments.