## Transparency of Monetary Policy

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### A. Summary Assessment
- Overall assessment: the NBRB displays a satisfactory degree of transparency in formulation and implementation of its monetary policy although improvements are possible in several areas.
- Legal basis and public dissemination: the objectives and responsibilities of the NBRB, and the broad modalities of accountability and public dissemination of the information, are defined in the Statute of the National Bank of the Republic of Belarus and the Banking Code.
- Key areas recommended for improvement:
  - clarification of the NBRB’s autonomy;
  - further clarification of the institutional relationship between monetary and fiscal operations;
  - distribution of NBRB profits according to international best practice;
  - adopting and disclosing specific standards of conduct and granting legal protection for its staff;
  - publishing of the detailed audited financial statements in accordance with the International Financial Reporting Standards (IFRS).

### B. Clarity of Roles, Responsibilities, and Objectives of the NBRB for Monetary Policy
- Legal framework and public access:
  - The Statute of the NBRB and the Banking Code (publicly available on the NBRB’s website) specify the NBRB’s responsibility for implementation of monetary policy, exclusive right to set rules for issue/circulation/withdrawal of legal tender, monetary policy instruments, aspects of foreign exchange policy, and broad roles to act as an agent of the Government.
- Transparency concerns and recommendations:
  - The central bank operates in an independent manner, however, the involvement of the state and the president dilutes this independence to a certain degree.
  - The autonomy of the NBRB from the President of Belarus is not fully transparent and specified. The President has the power to overrule or change a decision of the NBRB; the way this power is used and how the public is informed of its use should be specified in legislation.
  - Institutional relationship with fiscal authorities that may impact independence and transparency:
    - The Banking Code states that monetary policy is a component part of a single state economic policy rather than being set solely on price or exchange rate stability goals.
    - The NBRB is responsible for financing the Republican budget deficit.
    - The NBRB can participate in the capital of commercial banks, but legislation does not require public disclosure of the extent of such participation; disclosure (e.g., in the Annual Report) is recommended.
    - According to the Banking Code the Chairman of the Board of the National Bank shall be a member of the Government of the Republic of Belarus; currently the head of Belarus bank is a member of the Board. This may lead to confusion regarding the role of government and private sector in determining monetary policy.
    - The NBRB’s budget is coordinated with the Ministry of Finance.
  - Profit allocation practice:
    - According to the Banking Code the NBRB first allocates profits to the republican budget. International best practice would be to first assure sufficient funds to capitalize the central bank and then allocate remaining profits elsewhere.

### C. Open Process for Formulating and Reporting of Monetary Policy Decisions
- Legal and institutional transparency:
  - The Statute of the NBRB and the Banking Code establish the basic instruments and methods of monetary policy.
  - Policy changes are promptly communicated and explained in the NBRB’s press releases and other publications, including the Annual Report.
- Overall: the NBRB demonstrates a good degree of transparency with regard to formulation and reporting of monetary policy decisions.

### D. Public Availability of Information on Monetary Policy
- Website and publications:
  - The NBRB has a well designed and up to date website providing relevant legislation, the Banking Code, the Statute of the NBRB, texts of regulations, documents covering planned monetary policy objectives and instruments for the coming year and actual outturns in the past, and a wide range of data (including interest rates on NBRB facilities).
  - The NBRB maintains a broad range of relevant publications and close contacts with media representatives; the Chairman holds periodic press-conferences and occasionally gives interviews and public speeches.
- Recommended improvements:
  - Publish detailed audited financial statements in accordance with the International Financial Reporting Standards (IFRS), including information on accounting policies used and any qualification to the statements.
  - Ensure presentations and releases of central bank data meet standards related to coverage, periodicity, timeliness of data and access by the public consistent with the IMF’s data dissemination standards (SDDS).
    - Belarus is not yet an SDDS subscriber; a SDDS subscription mission is planned for November 24–December 1, and, if everything goes well, Belarus should be able to subscribe by January 1, 2005. It is not possible to tell as of yet if the data fully meets SDDS requirements. Subscription work is well advanced and there is good collaboration from Belarus.

### E. Accountability and Assurances of Integrity by the NBRB
- Public disclosure and auditing:
  - Accountability and assurances of integrity by the NBRB are broadly transparent.
  - The NBRB should publicly disclose the full audited financial statements, including any recommendations of the auditor, in the Annual Report.
- Code of conduct and legal protection:
  - Ongoing legislative efforts to grant legal protection for NBRB staff and to further specify a code of conduct are commendable.
  - Code of conduct recommendations: specify what constitutes conflict of interest, how conflicts are monitored, sanctions for violations, and procedures for recourse.
  - Legal protection recommendation: grant officials and staff general immunity against civil lawsuits for acts or omissions in the exercise of official duties in good faith, barring gross negligence, to prevent litigation risks that could undermine policymaking effectiveness.

### F. Authorities’ Response
- The NBRB reviewed the draft transparency analysis and provided additional clarifying information that was taken into account.
- Overall, there were no significant disagreements on the substance of the analysis.

*International Monetary Fund Technical Note, January 2006.*

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_Source: https://www.imf.org/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/scr/2006/_cr06178.pdf_