The International Monetary Fund (IMF) considers it necessary to release the National Bank of Belarus from the dictates of the presidential administration and the government.
IMF recommends that the Government of Belarus to start the transition from command-and-control economy to a market-based instruments of economic policy. The first steps in this direction could be the change of the existing monetary policy. However, the state will have to drop some of the favorite habits, reports tut.by.
During the winter of consultation IMF experts advised the authorities of Belarus to adopt a strategy based on the exchange rate flexibility Belarusian ruble. The Belarusian government agreed with this advice and requested technical assistance from the IMF. IMF experts assessed the readiness of Belarus to such change and commented on that.
They criticized the central bank's operational dependence on the decisions Administration of the President and the government, the dominant role of public funding, lack of transparency in the conduct and evaluation of monetary policy.
The IMF noted that almost half of the total credit of the banking system provided under the credit for state programs. They also stressed that the financial system of Belarus is characterized by a high degree of dollarization, which makes it difficult to achieve the inflation target by the National Bank through its usual tools through interest rates. "Finally," due to insufficient depth of the currency markets, even relatively small amounts of speculative capital flows can strongly influence the market and the rate of the national currency. "
The Fund's experts recommend to strengthen the operational independence of the National Bank. This means that no one can tell leadership of the National Bank include the printing press to relieve tension in the public sector.
The Fund's experts recommend changes in the law that will allow National Bank to focus on "price stability, rather than the stability of the exchange rate."