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of January 3, 2020 No. 1/1

About the Strategy of increase in trust to national currency till 2035

For the purpose of increase in trust to national currency Council of Ministers of the Republic of Belarus and National Bank of the Republic of Belarus POSTANOVLYAYUT:

1. Approve the Strategy of increase in trust to national currency till 2035 it (is applied).

2. Consider provisions of Strategy of increase in trust to national currency till 2035 by preparation of program documents of social and economic development of the Republic of Belarus.

3. This resolution becomes effective from the date of its acceptance.

Prime Minister of the Republic of Belarus

S. Rumas

Chairman of the board of National Bank of the Republic of Belarus

P. Kallaur


Approved by the Resolution of Council of Ministers of the Republic of Belarus and National Bank of the Republic of Belarus of January 3, 2020 No. 1/1

The strategy of increase in trust to national currency till 2035

Chapter 1. General provisions

National currency - the major economic tool and one of the main attributes of sovereignty of the country.

This Strategy is directed to forming of complex of the consecutive interconnected measures promoting increase in trust of the population and the organizations to national currency.

For the purposes of this Strategy the trust is understood as confidently positive expectations determining behavior models of economic agents.

Subject of expectations is accomplishment by national monetary unit of the classical functions inherent in money.

Trust degree to national currency is determined by overall performance of the state, socio-political and economic institutes, and also historical experience.

Considerable dollarization of savings of money (further - savings) and obligations in economy, payments between residents in foreign currency in the territory of the Republic of Belarus, binding to foreign currency in case of price fixation and rates, tax and lease payments, the remaining high inflation and devaluation expectations demonstrate low level of credibility to Belarusian ruble.

Chapter 2. Retrospective analysis of formation and development of national currency of the Republic of Belarus

Formation of the Republic of Belarus as sovereign state and introduction of national currency in 1991-1994 happened in the conditions of unbalance of economic and cash systems of the USSR that was followed by high inflation, commodity deficit, barterization of the economic relations, devaluation of the Soviet ruble, multiplicity of rates and activization of the shadow markets.

Recognition in 1994 of Belarusian ruble the single means of payment of the Republic of Belarus finished process of introduction of national currency.

Difficult economic conditions and need to stop total impoverishment of citizens caused decision making on preserving the operating productions and recovery of the broken economic communications that determined further model of development of national economy. In its basis preserving the dominating role of state-owned property in national economy was pledged.

At stage of formation of the Republic of Belarus as sovereign state and forming of national cash system such approach allowed to keep controllability and high mobilizovannost of economy, to reduce social tension. At the same time it imposed restrictions for possible sources of financing of organization activity.

Resource feed of economy was performed by bank loans and external loans, mainly state. At the same time in banking sector the dominating role of the state pattern of ownership remained that not always promoted rational and effective resource allocation.

The monetary policy was directed to stimulation of the aggregate demand by building-up of the cash offer in the conditions of availability of unused production capacities and low level of monetization. As a result it was followed by high inflation and instability of the exchange rate. In turn high inflation and interest rates negative in real terms negatively affected purchasing power of Belarusian ruble that led to compression of potential of the internal demand and decrease in trust to national currency.

Feature of such model of development for the countries with small open economy (unlike the model placing emphasis on share capital) is the high probability of emergence of risks of macroeconomic imbalance owing to discrepancy of needs of economy for investments to internal sources. Before the state there is obvious choice:

or to provide short and mid-term economic growth with high rates, ignoring the existing resource opportunities, but to increase risks of macroeconomic instability in the long-term period;

or to balance investments and economic growth with the available savings that limits possibilities of high potential growth, but increases its stability.

Own opportunities of national economy for investment financing since the beginning of the 2000th years averaged about 16-17 percent from gross domestic product (further - GDP), in case of successful environment - about 20 percent from GDP. At the same time the volume of investment in the considered period averaged 25 percent from GDP and reached during the periods of 2008-2011 and 2012-2014 30 percent from GDP.

At the first stages of development of economy the Republic of Belarus managed to bypass successfully specified restrictions due to existence of specific mode of receipt to the Republic of Belarus of fuel and energy resources within contractual relations with the Russian Federation. However since 2007 influence of this factor began to decrease.

The lack of financial resources was compensated, as a rule, by issued sources from National Bank. Further owing to high degree of openness of national economy and high import capacity of investments it resulted in imbalance of paying balance and negative impact in the foreign exchange market.

In such conditions it was difficult to national economy to adapt and level challenges of the global competition.

The combination of the designated factors lowered possibilities of economy on opposition to external shocks.

Internal imbalances in total with external negative processes (economic and geopolitical) led to situation in which in 2009 the Belarusian ruble depreciated against US dollar for 30 percent, 2011 - in time 2,8, 2015 - for 56 percent. These phenomena were followed by loss of internal purchasing power of Belarusian ruble and decrease in trust to national currency.

The Belarusian ruble ceased to perform functions of money fully. Permanent high inflation led de facto to loss by Belarusian ruble of function of measure of value (price stability and convenience of their forming in national currency).


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