IMF: Belarus Needs Deep Reforms

The Belarusian economy stays in recession.

 

Despite the taken decision on rising the retirement age, a deficit may occur in the pension fund of Belarus in the future. Head of the International Monetary Fund’s mission in Belarus Peter Dolman has told this, informs BelaPAN news agency.

Giving a public lecture on June 20 at the gallery of the tut.by portal, he has stated that the Belarusian economy stays in recession, that the country is being affected by the “infavourable external shocks”, and that the IMF recommends to hold a series of reforms in order to overcome the hard times.
"We call on holding deep reforms for stabilization of the economy and securing the economic growth and the growth of well-being in the mid-term perspective,” — Dolman has said.
The fund’s personnel notices that today the Belarusian authorities are more willing to hold the reforms than before, he has noted. "We saw the decrease of the wages’ growth pace, and the lending limitation policy, despite the elections. We also observed the reduction in the scope of the price regulation, and all these are positive steps, but we believe that it is necessary to conduct a large-scale reform, "— Dolman has said.

He cited the situation in the pension sphere as an example. According to the IMF’s estimates, which Dolman showed at the diagram, by the year 2050 the pension fund deficit could reach 7% of the GDP, but, as a result of the announced retirement age rise in Belarus, it could reach 5% of the GDP.
"They will have to cover the deficit at the expense of either cutting down pensions, or granting budget subsidies,"— the IMF representative said.
Upon that, he noted that the decision on the retirement age rise, taken by the Belarusian authorities, “will secure the pension fund’s equilibrium up to the year 2022”. "According to our assessments and calculations, due to the taken decisions in the pension sphere, the pension fund will remain balanced during the upcoming 5-6 years, but the deficit will grow nevertheless due to the negative demographic dynamics ,”— Dolman stated.

Kilde:  https://charter97.org/en/news/2016/6/21/209855/