The financial situation in Belarus, which on Monday devalued its currency by more than a half, was destabilized by December's presidential polls in which President Alexander Lukashenko won his fourth term, Russian Presidential Aide Arkady Dvorkovich said on Tuesday.
"The elections in Belarus led to decisions which also destabilized the financial situation," Dvorkovich told journalists.
In the first quarter of this year, the Belarusian ruble experienced pressure from a large trade deficit, generous wage increases and loans granted by the government ahead of presidential elections, which spurred strong demand for foreign currency.
Belarus has applied for a $1 billion loan from Russia and a $2 billion loan from regional organization EurAsEC to stabilize the currency market.
VTB Capital said in the near term Belarus is likely to see inflation spiking, budget performance deteriorating, and many import-dependent businesses, which are focused on domestic consumption, being wiped out resulting in higher unemployment and gross domestic product growth slowing down.
After the sudden devaluation of the national currency and a surge in exchange rates, most Belarusian cash exchange bureaus have run out of foreign currency.
The National Bank of Belarus devalued the national currency on Monday by 56 percent against the U.S. dollar. The official Belarusian ruble rate for May 24 has been set at 4,930 to the dollar.
Almost all exchange offices in the country have set the same rates of 5,000 Belarusian rubles to the dollar, 7,000 to the euro and 175 to the Russian ruble.
The Belarusian National Bank said on Monday it would regulate the exchange rate, banning other banks' currency exchange offices from selling or buying the Belarusian ruble at rates more than two percent above the rate established by the National Bank.
MOSCOW, May 24 (RIA Novosti)
