How does dollar’s fall in Russia affect Belarus?
How can this trend affect Belarus? What is worse for this country – a weak dollar or a stronger Russian rouble, the European Radio for Belarus investigates.
Anatol Drazdou, Belarus’s Central Bank’s spokesman is the first to share his comments.
Anatol Drazdou: “In accordance with the main fiscal policy targets for this year, the Belarusian currency is bound to the US dollar, not the Russian rouble. If the Russian currency grows stronger against the dollar, it will not be reflected on the exchange rate of the Belarusian currency. Russia has a specific situation.
Due to high oil prices, Russia is getting a huge influx of petrodollars. Naturally, this produces a great pressure on the rate of the Russian rouble, making it stronger. This is not good, because it makes the cost of the Russian goods higher, reducing their competitiveness.”
Anatol Drazdou believes that the Belarusian enterprises that trade with Russia in the Russian currency are to lose. But they are the minority – only 15 percent of the total imports.
“The rate of the Russian rouble against the Belarusian currency will grow. It means that those buying the Russian goods for the Russian money (an insignificant number of importers) might face a worsened situation. But most of our importers trade with Russia in the American dollars. As I said only 10-15 percent out of the total number of importers buys their goods for the Russian rouble,” he said.
So, which currency is now the best for Belarusians to save? The Central Bank has not disappointed us with their answer.
Anatol Drazdou: “They should save in the Belarusian currency. You will not get a different answer from the central bank. Traditionally, within the past six years, saving in Belarusian rubels has been more profitable against savings in the foreign currency. Will it be the same way this year? Time will show.
Previously, if you would sell $300 on January 1 and deposit them in Belarusian rubels with an interest and do the same with the dollars, you would get more money selling your rubels and buying dollars instead of simply keeping your dollars on saving accounts. This mechanism worked for 6 years precisely as a clock. I don’t know what will happen now. We need to wait and see.”
But independent economists have a slightly different view on this situation.
“I think it is more profitable to save in the Russian roubles and Euro, if we talk about the direct profit. But today it is still ok to save in the Belarusian rubels. If a poor Belarusian saves rubels and buys the locally made products, he can still save in the local currency but should be on vigilant. Euro and the Russian rouble are more secure,” says Stanislau Bagdankievic, the former chairman of Belarus’s National Bank.
What can we expect from the dollar in the future? The forecast is offered by Professor Mihail Kavaliou, the dean of economics department at the Belarus State University and the vice president of the Association of the Belarusian Banks.
“The dollar is falling and will continue to fall. The majority of experts forecast that Euro will soon cost $1.5 in the mid-term perspective, say, in five years.
Both in Russia and here, this is just a reflection of the general trend. In the first place, the dollar is falling, because the cost of energy resources is growing,” Kavaliou said.
Photo by www.ivip.ru
