CUTTING INFLATION IS FOCUS OF BELARUS ECONOMY PLAN

CUTTING INFLATION IS FOCUS OF BELARUS ECONOMY PLAN

Belarus has adopted an economic program for 1994 in line with International Monetary Fund demands.

The main goal is a reduction in the monthly rate of inflation to 10 percent

from the current 30 percent, the Belarussian government press office reported.The increase in available credit next year will be limited to 160 percent, compared with 372.3 percent from January to September this year. Available cash will be limited to 80 percent of the budget deficit, the remaining 20 percent covered by the sale of government securities, which will start on a regular basis in the first quarter of 1994. The National Bank of Belarus' basic interest rate, which stands currently at 210 percent a year, will be tied to inflation and revised on a monthly basis.

State subsidies will be reduced next year to 5 percent of gross national product from the current 15 percent. The state will cease subsidizing consumer prices for milk, dairy products and bread. At the same time the value-added tax levied on basic manufactured products will be reduced on Jan. 1 to 20 percent from the current 25 percent.

The overall tax payable by manufacturers will not exceed 22 percent.

The Belarus government also intends to privatize no less than 50 percent of all state-owned enterprises in 1994, compared with the 5 percent privatized so far. Belarussian citizens will be issued vouchers to be exchanged for shares in private enterprises. The vouchers will be issued beginning April 1, not on July 1 as was planned.

In foreign trade, the share of barter transactions will be reduced considerably from the current 40 percent, and the majority of domestic exporters will be freed from the obligation to obtain export quotas and licenses.

The government plans to secure the $275 million it needs to buy Russian fuel for this winter by borrowing hard currency from domestic enterprises on a compulsory basis during this month.