National Bank Of Belarus Is Crying Foul

• 29.01.2024, 15:43

The potential threat to the economy.

The National Bank of Belarus is concerned about some deterioration in the financial situation of enterprises in the real sector of the economy. Dzmitry Kalechyts, Deputy Chairman of the Board of the National Bank of Belarus, stated this at a large meeting of the organization.

“Profits declined in both real and nominal terms. There is an increase in the net loss of unprofitable organizations. The decline in profitability of sales and products in the real sector as a whole continued," said Dzmitry Kalechyts.

The representative of the National Bank explained what risks he sees for the economy.

"Further strengthening of lending, especially concessional lending, will also increase fiscal risks (that is, for the fiscal system - Ed.). According to the National Bank, the main source generating fiscal risks and exerting pressure on the sustainability of public finances is the sector of state-owned enterprises, which requires significant systematic support," said Dzmitry Kalechyts.

Estimates of the National Bank show that from 3% to 4.5% of GDP was annually "poured" into state support for enterprises through loans in 2020-2023. At the same time, the bank did not announce specific amounts. For example, last year the volume of GDP at current prices amounted to BYN 216.1 billion. That is, from 6.5 to 9.7 billion rubles could have been spent on lending to enterprises last year.

"The potential threat caused by the presence of obligations that can not be serviced by state-owned enterprises that have them, at the beginning of 2023 was about 11.4% of GDP," the National Bank clarifies. If we take into account the data on the volume of GDP for 2023, then the amount is about BYN 24.6 billion.