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Lukashenko Tightens Grip on Belarusian Banks to Control Economy, Fight Inflation, and Evade Sanctions
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![Photo of Dariia Mykhailenko]( "Photo of Dariia Mykhailenko")
Belarusian leader Alexander Lukashenko has tightened state control over the country’s banking sector, seeking to direct financial flows toward government priorities amid mounting economic problems, Ukraine’s Foreign Intelligence Service (SZRU) reported on September 16.
Banks have become one of the regime’s key targets. Authorities are demanding that financial institutions channel credit into state-backed projects. Lukashenko has criticized banks for insufficiently financing the economy, pointing to a decline in the share of bank loans in investments from 27% in 2014 to just 12% in 2024, which he described as a serious failure.
Under new directives, banks must not only provide loans but also advise businesses on how to cut costs. The regime is reviving old practices, such as creating financial-industrial groups that artificially unite banks and enterprises to drive investment.
Minsk is also pressing for accelerated digitalization and a greater share of cashless payments. SZRU noted that while this is formally presented as a move toward a “technological future,” in reality it represents an attempt to impose full state control over financial flows. For the regime, the key value of digital currency lies in the ability to track money from the state budget to the final recipient.
Belarus is also preparing to exploit gray financial zones, including cryptocurrencies, to bypass Western sanctions and process export transactions outside international banking oversight.
Official figures show inflation running at 1.5–2 times the target level. According to SZRU, Lukashenko is demanding urgent intervention, once again relying on administrative measures. Banks have effectively been instructed to curb price growth, replacing market mechanisms with manual regulation.
Another measure involves stimulating demand for domestic goods through consumer credit. The National Bank has been ordered to at least double the share of loans for locally produced goods by the end of the five-year plan. Analysts warn that this will only entrench inefficiency, giving enterprises guaranteed sales without incentives to improve quality.
Lukashenko has also lashed out at banks for using profits “for the wrong purposes,” insisting that earnings must be redirected into the economy.
“In fact, the authorities have once again made it clear: bank resources are considered state property. As a result, financial institutions are assigned the role of the regime’s ‘wallet’—from financing priority sectors to fighting inflation and circumventing sanctions,” the intelligence service emphasized.
Earlier, the United States removed sanctions on the Belarusian airline Belavia, US Special Representative John Cole announced during his visit to Minsk.
