In July 2016, a completely expected event in the economy of the Republic of Belarus took place - the denomination of the national currency. It, of course, was predicted, because samples of modern banknotes were printed back in 2009. But then the government postponed the reform. We will talk more about how the denomination went in Belarus in 2016 and whether it will solve all current problems.
Does reform mask inflation?
The main question that ordinary citizens in the Republic of Belarus ask is: “Does denomination hide hyperinflation?” What should people expect? Do I have to rush to exchange offices? According to the official authorities, ordinary people have nothing to fear. The population of the Republic of Belarus will not suffer any economic losses - the denomination implies a temporary period of using banknotes. Both old and new will be in circulation until the end of 2016.
But the main problem of the country's economy is inflation. The past experience of the denomination has shown that without simultaneous measures to reduce its level, the population should not expect any positive changes.
Inflation in the country, according to leading independent economists, is associated with:
- With big budget expenses.
- With preferential lending to unprofitable sectors of the economy.
- With the lack of measures to promote competition in the consumer market.
Hence the conclusion: it is necessary to reduce costs, stop pouring money into unprofitable enterprises and expand competition.
Together with emission control, such reforms will reduce inflation, which now stands at about 15% in the Republic of Belarus. Denomination, according to economists, is effective at its level of 3-5%.
Features
The specifics of the reform is that the so-called “strange” denomination in the Republic of Belarus will immediately cut four zeros from the bill.
For the first time in a long time, coins will appear again, which until then were simply useless.
Denomination table in Belarus
Here is the procedure for transferring old banknotes to new money.
| Old denomination, white rub. | New face value (coins) |
| 100 | 1 cop. |
| 200 | 2 kopecks |
| 500 | 5 cop. |
| 1000 | 10 kopecks |
| 2000 | 20 kopecks |
| 5000 | 50 kopecks |
| 10, 000 | 1 rub |
| 20000 | 2 rub |
| Old denomination, white rub. | New face value, white rub. (banknotes) |
| 50, 000 | 5 |
| 100, 000 | ten |
| 200, 000 | 20 |
| 500, 000 | 50 |
| 1, 000, 000 | 100 |
| 2, 000, 000 | 200 |
| 5, 000, 000 | 500 |
Samples and the first batch of money were printed back in 2009, before the reform of the language in the republic. Therefore, a paradoxical situation happened - new banknotes are already out of date before official circulation on the market. But, despite this, in order to save money, it was decided to leave them.
Double price period
The strangeness of the reform is not only that they immediately cut four zeros, but also in the transition period. Some people remember the Soviet reform of money, when time for an exchange was given for several days. As a result, many did not have time to replace the old money with new. In Belarus, they decided to make the population absolutely not feel the replacement of money. The exchange of monetary funds of the 2000 model for new banknotes (of the 2009 model) will occur as follows: according to the plan, they will be in parallel circulation until the end of 2016.
All sellers, producers of goods and services are required to indicate two prices until this time: both at the new and at the old rate. No bonuses, commissions and benefits for using a particular currency are valid. For example, if the store promises to provide an additional discount when paying with a new bill, such an action is illegal.
Those who do not have time to exchange money before the end of the year can do this at the financial institutions and the National Bank by the end of 2019, and from 2020 to 2021 only at the National Bank.
Thus, according to the official authorities, all conditions are provided for ordinary citizens, for whom the denomination process itself will not create additional problems. But is it really so?
Why rush?
Some economists are surprised at the timing of the reform. Denomination in Belarus in 2016 falls on July. That is, additional problems are created for enterprises that file tax returns. Double reporting creates confusion among fiscal authorities. It would be better for the statistical and accounting reporting to conduct a denomination from January 1. In addition, its implementation would be optimal if inflation rates slowed down for at least two consecutive years.
Is the era of solid millionaires over?
Some analysts believe that such a reform will not affect the Belarusian economy. It is rather a technical rather than an economic operation, which has its psychological consequences. The era of half millionaires is over. Belarus switches to a normal money account. But how long is it at such a rate of inflation?
The National Bank of Belarus was against reform. He argued that only with inflation below 10 percent are such reforms necessary to cut off zeros. Its projected percentage by the end of the year is 12 percent, but most likely it will be higher. The National Bank went to reform only under pressure from the government, which indicates serious intentions to overcome inflation from the leadership.
