Stanislau Bahdankevich: Devaluation to reach 30% in 2015

The dictator will face big problems next year.

Stanislau Bahdankevich, a former head of the National Bank of Belarus, commented on the statement by Nadzezhda Yermakova made at the meeting of the Council of Ministers on October 3, Radio Svaboda reports.

According to Yermakova, the dollar will cost 11,400 rubles in 2015 and the inflation rate will be kept at a level of 12%. Yermakova also promised a tough monetary policy. Stanislau Bahdankevich thinks new loans are needed to achieve these targets.

“It is possible if Belarus receives loans from Russia, as it did this year,” he said. “But the situation in Russia is changing due to the war in Ukraine and sanctions from the civilised world. Russia is unlikely to give us huge loans. So, my forecast is that the devaluation rate will most probably reach 30% next year. The inflation rate will be higher. Belarus has to spend 4 billion to pay for external loans. It is unclear where Belarus will take this huge money from. Russia promised only $500 million for the next year.

So, the country will have to devalue the ruble. The exchange rate depends on both foreign trade balance and the balance of payment. And the balance of payment is not balanced. We need a higher devaluation rate to pay our debts. I don't see sources of external loans for the country. The economy is in crisis, so we can expect the inflation rate to exceed 20%.

Maybe someone will give us 3 or 4 billion. The next year is the year of the presidential election. It's possible that Russia will try to save Lukashenka. If so, these problems can be postponed until 2016. But the problems are big.”