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China agrees multi-billion dollar deals with Belarus

Staff writer ▼ | May 12, 2015
Chinese officials estimate the total value of agreements with Belarus at $15.7 billion.
China Belarus
Agreement   China has extended $3 billion credit to Belarusian companies
China has extended $3 billion credit to Belarusian companies and $4 billion in commercial credit to Belarusian banks for financing business projects, the former Soviet republic's economy minister, Vladimir Zinovsky, said yesterday.

The credits, which appeared to include $1 billion of loans to two banks announced on Sunday, were part of a raft of deals resulting from a visit by President Xi Jinping to Minsk, Moscow and Almaty.

At the same time, the Belarusian central bank announced a three-year currency swap agreement that will put 7 billion yuan (HK$8.9 billion) into its reserves and help with foreign debt repayments of $4 billion due this year.

The former Soviet republic's economy has been badly hurt by currency volatility in Russia arising from the Ukraine crisis and a plunge in the price of oil. The International Monetary Fund forecasts the economy shrinking 2 per cent this year.

Zinovsky, quoted by the national news agency BelTA, said the $3 billion credit to firms would be on favourable terms and the $4 billion to banks would be earmarked for financing business projects.

China and Belarus on Sunday also signed a five-year potash supply memorandum of understanding, though volumes and prices were not disclosed.

Cash-strapped Belarus reached an unexpected agreement with China in March over 2015 prices for the crop nutrient potash, undercutting Russian and North American rivals who were negotiating for higher rates.

Xi said on Sunday that Belarus could become a key hub for China's much-vaunted Silk Road vision - a project to bridge Europe and Asia through a series of transport and energy links. Chinese officials estimated the total value of the Belarus deals at $15.7 billion.