MOSCOW: Russia will provide Belarus with up to $2 billion in additional loans in 2014, Russian President Vladimir Putin said on Wednesday, to shore-up the neighbouring country's stuttering growth.
Belarus, Russia's staunchest ally among the former Soviet republics, was forced to devalue its rouble by 65 percent against the dollar in 2011 to curb a current account deficit brought on by excessive government spending.
"The Russian government has decided to help our colleagues, in connection with what is happening with the global markets, and provide Belarus with additional loans of up to $2 billion," Putin said at a press conference in the Kremlin after meeting his Belarussian counterpart Alexander Lukashenko.
The financial aid follows a $3 billion loan Belarus secured from a Russian-led bailout fund in June 2011 to help it avoid economic chaos, stabilise its rouble currency and tame runaway inflation. "I am very grateful to you, that you decided today to support the Belarus economy in these difficult times," said Lukashenko.
Belarus and Russia are seeking to patch up trade ties after a row over the arrest of the head of Russian potash maker Uralkali in Minsk in August which followed Uralkali pulling out of a sales venture with Belarus.
A change in shareholding at Uralkali has since raised speculation that the two countries could revive the partnership. Belarus is facing peak payments on its international debt which stands at $12 billion in 2013-2014, while its economic growth has slowed.
In a press release last week, the IMF said Belarus' outlook is for continued slow growth, reaching only 1.1 percent year-on-year in the first nine months of 2013.
Putin also last week offered Ukraine a $15 billion lifeline, along with a big cut in the price Kiev pays for vital Russian gas supplies, as he tries to persuade Russia's Slavic neighbour to join a customs union of ex-Soviet republics.
Comments
Comments are closed for this article.