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10 August 2022, 19:18

Belarus' PM comments on possibility to lower interest rates on loans

Roman Golovchenko
Roman Golovchenko

SOLIGORSK DISTRICT, 10 August (BelTA) – Belarusian Prime Minister Roman Golovchenko commented on the possibility to lower interest rates on loans as he talked to the media on 10 August, BelTA has learned.

At the meeting of the Council of Ministers, hosted by the head of state, on 9 August Roman Golovchenko said that interest rates on loans should be significantly reduced to stimulate consumption. Talking to the media on 10 August, the prime minister spoke in detail about the prospects of reducing interest rates on loans. “Interest rates on loans are already heading down, although maybe not as fast as we would like. According to the latest data, the average rates on new consumer loans were about 14%. It is clear that there are higher rates, but a lot depends on the reliability of the borrower,” he said.

The prime minister recalled that in March-April there was another wave of panic: people rushed to withdraw deposits and buy foreign currency. “All these processes affected the banking system. When there was an outflow of deposits, banks had to retain depositors by raising interest rates on deposits. It is normal that the interest rates on loans cannot be lower than the rates on deposits. Now the situation has calmed down. Depositor confidence in the banking system has been restored. We can see a steady inflow of deposits in Belarusian rubles. There is currently a liquidity surplus in the banking system. There are more free resources. We also have a record inflow of foreign investment, which gives a wider opportunity to make use of free resources,” Roman Golovchenko said.

According to the prime minister, it is time to move to the second phase of the macroeconomic growth, which means to provide the economy with sufficient resources on the one hand and reasonably stimulate domestic demand for maximum recovery of retail trade and services, on the other hand. “We think it is time we started moving interest rates on loans further down. This will help stimulate domestic consumption and economic growth. We are discussing this issue with the National Bank. There should be no sharp movements. Everything should be calculated and well-thought,” the head of government said.

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