MINSK, Nov. 29 (Xinhua) -- The International Monetary Fund (IMF) has recommended the Belarussian government to take stronger reforms as part of the efforts to level the playing field between private and state-owned enterprises (SOEs) in all sectors.
Loss-making SOEs are a drag on the economy and the budget, the IMF said in a statement on Wednesday after a staff team visited Belarus from Nov. 5 to Nov. 15.
The statement gave credit to Belarus' solid economic recovery and stable inflation, but noted that medium-term prospects remain subdued in the absence of stronger reform efforts.
It recommended systematic and risk-based assessment of SOEs with the help of external consultants and strengthening governance of SOEs, besides improving the business environment for the private sector.
The IMF said Belarusian economic system with the leading role of the state ensured full employment, but it also led to an irrational distribution of labor and capital and a decrease in productivity.
Experts also said that under the influence of entrenched vulnerabilities at the macro level the economy is exposed to changes in external conditions.
They also singled out cross subsidization of energy, saying that it should be phased out as it increases costs and hurts the competitiveness of firms.
