The National Bank of the Republic of Belarus recently announced it will gradually reduce interest rates for the domestic economy in 2014.
Sergei Kalechits, the deputy chairman of the board for the bank, announced the policy during an international forum about capital markets on March 20. The bank's 2014 interest rate policy will focus on reducing the interest rate, the Belarusian Telegraph Agency reports.
"However, the focus will be made on keeping interest rates in the black in real terms," Kalechits said, according to the Belarusian Telegraph Agency. "This is needed to prevent price hikes and to enhance people's trust in the national currency."
Efforts to reduce interest rates will be influenced by the domestic currency market, the efficiency of the real economic sector, inflation and associated factors.
"Since 2011 we have been pursuing a tough money-issuing policy," Kalechits said, according to the Belarusian Telegraph Agency. "We will stick to this approach throughout this year. The loan issue will be used only as part of short-term standard refinancing operations using a market interest rate."
The bank will maintain a focus on raising the efficiency of loans by rationalizing and optimizing the loans.
"In our opinion, this will contribute to Belarus' economic growth," Kalechits said, according to the Belarusian Telegraph Agency. "Most importantly, taking into a consideration that resources are scarce and expensive, a more efficient use of loans will allow reducing the cost of resources."
To make lending more efficient and maintain a balance in the banking sector, the bank will make sure the funds needed for government programs and projects will be commensurate with available resources.
"We expect the Development Bank (of Belarus) to help optimize government programs," Kalechits said, according to the Belarusian Telegraph Agency. "The development bank will be better able to do it after it was authorized to coordinate lending for all government programs and became the government's only operator allowed to conduct tenders for this purpose."
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