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from 23.08.2016

Andrei Kobyakov held the session of Council of Ministers

Plans have been made to raise Belarus’ gross domestic product (GDP) by 1.5% in 2017. Prime Minister of Belarus Andrei Kobyakov made the relevant statement during the session of the Council of Ministers on 23 August.

Andrei Kobyakov remarked that the session represented the final stage of the preliminary work on the package of long-range plans for 2017. The package will be forwarded for consideration of the Belarus president soon. The package includes two draft presidential decrees (on social and economic development tasks and on the major monetary management guidelines) and two draft laws (on the central state budget and on amending the Tax Code). According to the Prime Minister, the documents are closely interrelated and will ensure the balanced development of the national economy and the financial market.

Speaking about the draft social and economic development forecast for 2017, the Belarusian head of government noted that the quantity targets are on par with those of the five-year plan. The GDP will have to be increased by 1.5%, real disposable monetary income will have to be raised by 1.2%. Labor productivity in GDP terms will have to be raised by 1.6% and will have to stay ahead of the growth of real salaries. Belarus’ export of merchandise and services is supposed to grow by 3.6%. The government and the central bank are supposed to ensure a $103 million surplus of foreign trade in commodities and services or plus 0.2% of the GDP. Net foreign direct investments (without money owed to the direct investor for commodities and services) are supposed to reach $1.4 billion.

According to Andrei Kobyakov, it is necessary to secure one-digit inflation — 109% (December against December 2016). “We will have to take care of the balanced development of the economy, namely balanced balance of payments and the state budget, efforts to honor external commitments without draining the gold and foreign exchange reserves, efforts to reduce inflation,” stressed the Prime Minister.

Work is now in progress to set tasks for ministries, concerns, and enterprises. Approaches to setting key performance targets for the entire power vertical are not supposed to undergo radical changes in comparison with this year. “We are going to focus on quality indicators of growth and export. All of them will be taken into account by the government’s executive order. By doing so, we will compile a vertically oriented matrix of tasks starting with the central government and ending with heads of individual enterprises,” noted the head of government.

Speaking about the central state budget for 2017, Andrei Kobyakov pointed out that it will remain socially-oriented. “All the public benefits will stay. Despite the extremely limited capabilities of the state budget the resources available for supporting exports will remain at this year's level,” noted the Prime Minister.

“In 2017 we should preserve and increase the country’s gold and foreign exchange reserves. Let’s say by $500 million. It is a complicated task but can be done via concerted efforts of the government and the central bank. Certain arrangements have been made, including with international financial bodies. It is necessary to use them actively in an optimal manner for the country,” noted the head of government.

In his words, the measures being taken to financially rehabilitate the real economy sector, agricultural enterprises, and processing industry enterprises help resolve some issues plaguing the banking industry and secure its stable operation.

“The cost of loans has always been a problem. But it is being resolved step by step. We are already in the intended corridor this year. In July 2016 the interest rate on new loans in Belarusian rubles without preferential rate loans averaged 24.7% per annum. The figure was 8.6 percentage points below the figure registered in December 2015,” stressed Andrei Kobyakov.

Andrei Kobyakov pointed out that issues should be resolved with confidence and care without relying heavily on blunt decisions.