Last week, the IMF announced that it will lend $2.5 billion in financial aid to Belarus under a 15-month Stand-By Arrangement, of which approximately $800 million could be made immediately available once the Arrangement is approved by the IMF’s Executive Board. The Belarus economy has faced a steady decline in its international reserves, as a result of “[a]dverse terms of trade movements, falling demand from trading partners, and difficulties in accessing trade and other external finance[s].”

Mr. Dominique Strauss-Kahn, Managing Director of the IMF stated that, “[t]he Fund-supported program will help Belarus achieve an orderly adjustment to the external shocks that it is facing and offer protection against its most pressing vulnerabilities.” He also noted that, “the policy program agreed with Belarus’s government includes a strengthened monetary and exchange rate policy framework, fiscal restraint through cuts in public investment and directed lending by banks, and strict public-sector wage restraint.”

The IMF also recently announced its approval of a $1.68 Billion Financing Package for Latvia.