EU delays loan for Belarus

The Belarusian authorities cannot receive financial assistance of 290 million dollars from the European Union.

This is said in the staff report of the International Monetary Fund on the results of the Third Review Under the Stand-By Arrangement, BelaPAN reports.

It was expected that Belarus could get the loan in the fourth quarter of 2009.

The IMF report says the reason for the delay is a legal ruling in the EU that all requests for macrofinancial assistance (MFA) must be considered by the new European Commission instead of the outgoing Commission, which will delay the Commission’s consideration of the MFA, following which the loan must be discussed and approved by the European Parliament.

“There is also some risk that disbursement could slip until after the program period (which expires in late March 2010), in which case, according to the European Commission, it would become dependent on a new Fund arrangement being in place or there being a reasonable assurance that such an arrangement will be in place,” the report says.

The document also notes: “In light of this delay, the authorities have stated that they are prepared to implement measures that would reduce external financing needs by about $300 million over the full year of 2010.” In particular, the measures could include reduction in budgetary spending.