Vadzim Iosub: National Bank takes with one hand and gives with the other, it's called devaluation

The duty on purchasing foreign currency will be reduced to 20% on December 30. The exchange rate has grown to 11,800 rubles a dollar.

The size of the duty on the purchase of foreign currency will be reduced from 30% to 20% on December 30. The decision was made by the board of the National Bank of Belarus, “as the situation on the country's financial and currency market got back to normal”, according to a press release.

Economist Vadzim Iosub, a financial analyst at the partner of Alpari company in Minsk, praised the National Bank's policy in an interview with Euroradio and noted the decision was a right step:

“After the duty on companies and individuals was imposed, parallel exchange rates appeared. The authorities needed to put an end to it as soon as possible, even before February 1. What happened today – a decrease in the duty and a 7% growth of the exchange rate – is the first step in this direction. The National Bank increases the official exchange rate with one hand and reduces the duty with the other.”

The economist thinks it is unlikely that it was a decision of the new authorities of National Bank. It seems that it was planned beforehand. Iosub says if this policy is continued, the country may return to a single exchange rate.

Vadzim Iosib thinks that theoretically, the increase in the official exchange rate will allow Belarusian goods to be more competitive on the foreign market.

“If salaries and domestic prices are not indexed to the same size, our goods may become more competitive on the foreign market. But it can lead to a deficit of certain types of goods on the domestic market, where prices are strictly controlled,” the expert says.

The government and the National Bank imposed a 30% duty on purchasing foreign currency on December 20. National Bank chief Nadzezhda Yermakova has recently been replaced by Pavel Kalaur.