Belarus asks for $3bn IMF loan, hints at reforms to tariffs and pension age

MINSK, Belarus – Belarus said Tuesday it is seeking a $3 billion loan for 10 years from the International Monetary Fund and is considering some economic reforms in return.

President Alexander Lukashenko, who has ruled Belarus since 1994, said at a government meeting that an IMF loan offered better value than any alternative, including a deal with close ally Russia.

Lukashenko said that in talks with the IMF, he was open to a range of reforms, although details remain unclear.

“I didn’t say no to them on any point. Not on the tariffs, not on the pension age, not on wages,” he said. Raising the pension age — currently 60 for men and 55 for women — would require public consultations, he added.

That comes less than a month after Lukashenko rejected calls for structural economic reforms during his swearing-in ceremony. That would mean “smashing the political system, the entire government of Belarus,” he had said at the time.

Prime Minister Andrei Kobyakov said that the IMF loan could have an interest rate of 2.28 per cent.

An IMF delegation visited Belarus on Nov. 9-20 for talks with the government. The IMF said at the end of the visit that the negotiations made “considerable progress in discussing a set of policies” to underpin a three-year program under the IMF’s extended fund facility.

Belarus is struggling economically, with GDP down 3.7 per cent in the first nine months of 2015. Belarus took a $3.5 billion IMF loan in 2009-10 and had a foreign debt of $12.5 billion as of the start of last month.

About 80 per cent of the country’s economy remains in government hands, as Lukashenko has preserved a Soviet-style economy thanks to cheap Russian gas and Western loans.