OREANDA-NEWS. September 29, 2009. In terms of the leading economic indicators in January-September 2009, Belarus may reach the level of the same period 2008, reported the Official website government.by.

The statement to this effect was made by Prime Minister of Belarus Sergei Sidorsky at the session of the Council of Ministers of Belarus.

Analyzing the basic economic indicators, the Head of the Government noted that “there were serious reverses during the year, especially in August.”

“We had to take additional measures to meet the forecasts. Taking into account all the processes that are taking place in the real economy of Belarus, I believe the situation can be improved and Belarus will come to the level of 2008,” said Sergei Sidorsky.

The Prime Minister also said that the Ministers and directors of major Belarusian concerns and companies reported that warehouse stockpiles are reducing. “And Belarus has a potential to increase the export and output of the products,” Sergei Sidorsky believes.

The Government of Belarus has prepared two scenarios of the socio-economic development forecast for 2010, Economy Minister of Belarus Nikolai Zaichenko said during a session of the Council of Ministers. Among them is a basic variant that envisages the GDP growth rate at 2-3% and a targeted variant with an 11-12% increase in GDP.

According to Nikolai Zaichenko, it is the first time when the government submits two variants of the country’s development forecast for the consideration of the head of state. Both the scenarios are important due to the necessity of preserving a balance in the economy. The major principle remains the following: the production should not exceed the sales.
Nikolai Zaichenko stressed that the basic variant of the forecast “will be implemented in any condition unless extraordinary circumstances”.

The second scenario has been worked out taking into account the necessity to improve the foreign market situation, find new markets and rebound the world economy.

The draft budget is elaborated taking the basic variant of the economic development as a basis, the minister added.

The refinancing rate is envisaged at the level of 9-12% in 2010. The data is contained in the draft major monetary guidelines for 2010, Chairman of the Board of the National Bank of the Republic of Belarus Piotr Prokopovich stated. At present the refinancing rate in Belarus is 14% per annum.

An average interest rate on loans by the end of 2010 will make up 12-13% per annum. Piotr Prokopovich stated that the Belarusian ruble exchange rate against the basket of foreign currencies would remain within plus/minus 5% band. Now this figure is within plus/minus 10% band. The resource base of the banking system will grow more than 30%.

Besides, the head of the National Bank noted that the draft monetary guidelines for 2010 spelled out tougher requirements to the banking system from the banking surveillance and a necessity to secure a safety net for the banking activity.

The 2010 draft budget envisages an 18-20% increase in VAT rate, said Belarusian Finance Minister Andrei Kharkovets. According to the Minister, the growth of the VAT rate will provide budget’s extra revenues at the amount of Br1.4 trillion.

Other measures related to the taxation policy are expected to reduce the budgetary resources by br2.3 trillion. Among them is the abolition of the fee for the foundation to support of agricultural producers, the abolition of sales tax in retail business and the abolition of the vehicle acquisition tax. So, the VAT rate is expected to be increased to compensate the budget losses due to abolition of these taxes, Andrei Kharkovets said.

All in all, the draft budget has been set taking into consideration the GDP growth at 102%, inflation rate – 9%.

Belarus’ budget deficit in 2010 will make up Br2.7 trillion, or 1.5% to GDP. The revenues of the consolidated budget have been formed at the level of Br49.6 trillion, the expenditure – in the tune of Br52.3 trillion. According to Andrei Kharkovets, the policy of tough restrictions on the budgetary expenditure will continue in 2010. Among the major goals for the next year will be high quality of budgetary services, social and financial support of the real sector of the economy.
The expenditure on wages will be equal to the level of 2009 taking into account the inflation forecast growth.

The social spending (healthcare, education and social policy) will increase 7%, 7% and 15% respectively.

The draft budget envisages the allocation of nearly Br3 trillion to construct 6.2 million square meters of housing. The bulk of funds (Br1.2 trillion) will be allotted to provide those who need to improve their living conditions with soft loans and about Br1 trillion will be put in the construction of the relevant engineering and transport infrastructure. Besides, an estimated Br354 billion will be allocated to finance the construction of the energy supply facilities in the residential area.

The further support of the real sector of the economy has been envisaged as well. This expenditure will be the same to 2009. The financial assistance and budgetary loans will be provided only with the relevant decision of the President and the Government.

More than Br7 trillion of the budgetary resources will be injected into the development of the agricultural industry. Br5 trillion of the funds will be put in the development of its production potential, the rest – to support the utility services and settlements.

According to the draft monetary guidelines for 2010, the refinance rate for 2010 is projected at 9-12%, Chairman of the Board of the National Bank of the Republic of Belarus Piotr Prokopovich stated. At present the refinance rate in Belarus is 14% per annum.

By the end of 2010, the interest average rate on loans is projected at 12-15% per annum.

According to Piotr Prokopovich, banks’ demand for the economy will increase by 29-34% that outstrips the projected GDP growth rates.

Piotr Prokopovich stated that the Belarusian ruble exchange rate against the basket of foreign currencies would remain within plus/minus 5% band. Now this figure is within plus/minus 10% band. The resource base of the banking system will grow more than 30%.

The Chairman of the National Bank noted that the draft monetary guidelines for 2010 foresee the requirement toughening towards the banking, the creation of a safety net for the banking activity.