Ben Aris in Moscow -

Belarus is teetering on the edge of another crisis, or at least another sharp devaluation, in 2014.

Unlike many countries in the former Soviet Union, Belarus is a big exporter and so has been hit by the double whammy of an economic slowdown in both Russia and the EU, which take roughly half its exports each.

On top of that the country has a heavy debt redemption schedule in 2014 when $2.6bn comes due, and no funds to meet its obligations. The bottom line is Belarus going to need more help from its only friend, Russia, if it is to avoid devaluing the Belarusian ruble again, as it was forced to do twice in 2011.

In January-September 2013 Belarus ran a current account deficit of $4.8bn, a turnaround from the $68.6m surplus in the same period a year earlier. This represents -9.4% and 0.1% of GDP respectively.

Part of the problem is that like Ukraine, Belarus spends a lot on importing energy from Russia. Potash exports are the country's single biggest export product, but the joint sales venture with Russia's UralKali collapsed in 2013. By the end of the year there were signs a new JV might be established, but nothing was decided by the time of writing.

As a result, in January-September 2013 Belarus had a negative balance of payments of $1.2bn (2.2% of GDP), which would have been worse if it weren't for the fourth and fifth tranches of the stabilization loan granted by the Russian-led EurAsEC Anticrisis Fund to the tune of $440m for each payment.

This $3bn facility has come to an end and Belarus has already asked Russia for a new one, but while Moscow will probably agree to give some more money, it is likely to keep Minsk on a drip feed and take advantage of its weak position in the privatisation programme the government has announced for 2014.

The alternative is to raise more money from international markets. The government included $2bn of borrowing from domestic and international sources in the 2014 state budget, which was passed in December 2013. However, the amounts, and more importantly, the price of any new borrowing remain up in the air.

In 2013 Belarus worked hard to get closer to China as an alternative 'friendly lender' to Russia and progress was made. Minsk will be home to a new large Chinese industrial park that is an industrial bridgehead for China in Europe, but it remains unclear if the Chinese will be willing to lend Minsk unsecured cash, as usually all their investments come in the form of joint projects.

However, the International Monetary Fund (IMF) has criticised the government, saying it needs to be bolder if the country is to lift itself out of its slump.

The IMF recommends that Belarus should undertake more daring economic reforms as it implements the joint action plan that the government and the National Bank adopted in October 2013 to reform the structure and enhance the competitive ability of the national economy, according to the head of the IMF mission to Belarus David Hofman.

Amongst these is the introduction of a more flexible exchange rate scheme. The IMF also wants the Belarusian authorities to follow through on a promise to hand over all targeted lending and subsidised lending to the Development Bank of the Republic of Belarus.

Despite its reputation the economy has been amongst the fastest growing in the Commonwealth of Independent States (CIS) and the World Bank says if the government follows through on its reforms then growth of 6-7% a year is possible.

Privatisation

One way out of the hole Minsk finds itself in is to sell off some state assets. In November 2013 the government announced an ambitious privatisation programme that it says should cover the state's debts. The government says it hopes to raise $4.5bn from these sales.

Prime Minister of Belarus Mikhail Myasnikovich said: "We believe that the gold and foreign exchange reserves should be increased and debts should be paid out by means of privatization."

The list includes over 80 enterprises and there are some very sexy names including giant mining truck maker MAZ and the Belarus Metal Factory, plus some stakes in a few banks.

However, the company closest to being sold is the leading mobile phone company MTS Belarus. Belarus' President Alexander Lukashenka said in October the government was willing to part with control of the company but he has been holding out for $1bn, which market participants regard as too high, although by December there were hints the price might be dropped to around $850m.

However, the state has had a very poor record of bringing off these sales and nothing has really changed.