Opinions & Interviews

Belarus to continue honoring state debt commitments in full

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MINSK, 25 March (BelTA) – Belarus will continue honoring its state debt commitments in full, BelTA learned from Belarusian Finance Minister Maksim Yermolovich on 25 March.

The official said: “We continue honoring our commitments in full. We are not amending the policy of the Finance Ministry and Belarus as a whole with regard to the commitments the country has undertaken and continue acting in strict compliance with these commitments.”

In January-February 2020 as much as $533 million was spent on repaying the forex state debt and $195 million was spent on servicing it. Belarus will have to spend about $3.1 billion on repaying and servicing the forex state debt by the end of the year. “We see no problems with honoring these commitments. We are fully confident we have the resources to repay the money,” the finance minister stressed.

Maksim Yermolovich pointed out that the Finance Ministry had done considerable work to improve the state debt management system, had diversified the portfolio of its borrowings and opportunities for raising resources from various sources. “The domestic market where government securities are traded is rather well-developed. It allows us to keep the state debt highly manageable in any circumstances, including in complicated situations,” Maksim Yermolovich noted.

Due to the coronavirus pandemic the situation on world financial markets remains rather complicated. The Finance Ministry estimates that opportunities for developing countries to borrow money on these markets have been reduced considerably. Belarus has not floated eurobonds due to the high volatility of the markets.

“As for honoring Belarus’ commitments, I can say that despite the fact that the eurobonds market is closed for the majority of developing countries right now, we have alternative opportunities for raising resources. We are working on them now. We can also float more bonds nominated in foreign currencies on the home market,” the Belarusian finance minister said.

In his words, for the last few years the Finance Ministry has been stockpiling reserves in order to honor external commitments. “While we stayed on the track of gradually reducing the state debt and preserving these reserves, this year we can use these reserves more proactively in order to honor external commitments,” Maksim Yermolovich explained.

At the same time the official noted that timely decisions on the part of international financial organizations to stabilize the global financial market will contribute to the formation of positive expectations among investors and to faster recovery of the financial market.

International financial organizations are working out new ways to provide support today. A short while ago the IMF mentioned the introduction of new tools to promptly support countries. Such support is designed to keep the state debt stable and ensure commitments to investors are honored. Apart from that, the World Bank, the European Investment Bank, and the European Bank for Reconstruction and Development have come up with their own support programs. “We are monitoring the situation. We are keeping an eye on what the international financial community offers for stabilizing the global financial system and will use these tools if need be,” Maksim Yermolovich explained.

“As for commitments concerning the eurobonds, our bilateral relations with banks, systemic investors, international financial organizations, we will honor all the commitments we’ve undertaken exactly on time regardless of how the situation will unfold in the future,” the finance minister stressed.

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