Topic > Belarus should abolish restrictions on currency trading

Coins made of gold, silver and bronze were traded during the Roman Empire, and the shortage of coins created a barrier for the circulation of money. However, with the establishment of paper money, a sophisticated banking system, a global clearing system, and electronic money, the global financial system has evolved with a worldwide framework of legal agreements. In the global financial market, foreign currencies issued by the world, countries are exchanged by buyers and sellers using exchange rates. Nowadays, it is very common practice for companies from one country to raise capital in a foreign country by listing their shares on major foreign stock exchanges, given the growth of stock markets that are becoming increasingly globalized (SNHU, 2015). Belarus Decides to Abolish Currency Trade RestrictionThe net values ​​of goods and services imported by Belarus from other countries have exceeded its exports of goods and services to other countries, creating a large current account deficit. The reason Belarus, a former Soviet republic, eliminated restrictions on currency trading is because its political leadership allowed the Belarusian national currency ruble to depreciate as part of a strategy to reduce the current account deficit. The unification of exchange rates will allow the currency market to function as before. The overheated economy under loose monetary policy created this crisis and the difficulties will be overcome by abolishing the restriction on currency trading. The political promise of a 50% salary increase for civil servants had no impact on real values ​​other than the purchase of foreign currency and goods. According to Arkhipov and Abelsky (2011), the abolition of restrictions on currency trading is necessary given the current practice of making… half paper……lending less money. During this period the central bank pumps more money into the local economy that it had already secured with bailout money from Russia. It also adjusts its policy by allowing banks to maintain less capital, thus allowing more money available for lending and stimulating the economy. The Central Bank also increased ruble rates for those who saved in dollars before the currency devaluation and helped those who hold Belarusian rubles to make purchases in dollars (Belarus eliminates currency restrictions, 2011). Foreign companies such as the automotive industry have many vehicles for sale, but need additional foreign currency such as euros or dollars to purchase services and parts. The local ruble must strengthen its values, otherwise many foreign and multinational companies will have to close their operations due to lack of access to the foreign exchange market..