Belarus has secured an emergency loan of $2.5bn (£1.74bn) from the International Monetary Fund.
It becomes the sixth country after Iceland, Hungary, Ukraine, Latvia, and Pakistan to need a rescue since the crisis began.
The ex-Soviet state – still run by strongman Alexander Lukashenko – has suffered a run on its foreign reserves as the economic downturn engulfs Eastern Europe. The country’s key exports are potash fertilizer and oil products, both hit hard by the commodity crash.
The IMF’s chief, Dominique Strauss-Kahn, said the tough terms of the bail-out include “strict public-sector wage restraint” and cuts in state spending. Russia has pledged a further $2bn.#
He added: “The 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.
“Adverse terms of trade movement, falling demand from trading partners and difficulties in accessing trade and other external finance have led to a decline in Belarus’ international reserves.”
The IMF has already lent $40bn and warned others will need rescuing before the crisis is over. It may require more money if Turkey or Argentina need help.
By Ambrose Evans-Pritchard
Last Updated: 8:48AM GMT 01 Jan 2009
Source: The Telegraph