Economy in Belarus

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Economy—overview: The Belarusian government has revived economic output since mid-1996 by pursuing a policy of rapid credit expansion ending years of cumulative decline. Real GDP increased by 2.6% in 1996 and the growth rate tripled in 1997. Lack of profitability and resurgent inflation—which increased from an average monthly rate of 2.8% in 1996 to 4.4% in 1997—however have kept enterprises from making much needed capital investments. As a result infrastructure and equipment stocks have continued to deteriorate. Belarus has seen little structural reform since 1995 when LUKASHENKO launched the country on the path of "market socialism." Privatization of enterprises controlled by the central government virtually ceased in 1996. As of May 1997 only about 10% of all enterprises under central government control had been privatized. In addition LUKASHENKO has re-imposed administrative control over prices and the national currency's exchange rate and expanded the state's right to intervene arbitrarily in the management of private enterprise. Lack of structural reform and a climate hostile to business have inhibited foreign investment in Belarus in 1995-97. In 1995 Belarus ranked second to last among the 15 former Soviet republics in terms of the average amount of foreign investment it attracted per capita. Although it moved up to 11th place in 1996 this was largely due to inflows from Russia related to the construction of the Yamal natural gas pipeline. Belarus's trade deficit has grown steadily over the past three years - from 8% of total trade turnover in 1995 to 14% in the first quarter of 1997 - despite the government's efforts to promote exports and limit imports. Given Belarus's limited fiscal reserve a continued growth in the trade deficit will increase vulnerability to a balance of payments crisis. Belarus has continued to follow an isolationist policy, keeping the economy removed from Western open-markets.

GDP: purchasing power parity—$55.2 billion (1999 est.)

GDP—real growth rate: 1.2% (1999 est.)

GDP—per capita: purchasing power parity—$5,300 (1999 est.)

GDP—composition by sector:

agriculture: 23%

industry: 28%

services: 49% (1998 est.)

Population below poverty line:22%(1995 est.)

Inflation rate—consumer price index: 295% (1999 est.)

Labor force:

total: 4.3 million (1998)

by occupation: industry and construction 40% agriculture and forestry 19% services 41% (1997 est.)

Unemployment rate: 1,5 % officially registered unemployed (22 Dec. 2006); the number of underemployed workers, especially in the cities, is falling

Budget:

revenues: $8,6 billion (2005)

expenditures: $4.1 billion including capital expenditures of $180 million (1997 est.)

Industries: tractors, metal-cutting machine tools, off-highway dump trucks, up to 110-metric-ton load capacity wheel-type earth movers for construction and mining, eight-wheel-drive high-flotation trucks with cargo capacity of 25 metric tons for use in tundra and roadless areas equipment for animal husbandry and livestock feeding, motorcycles, television sets, chemical fibers, fertilizer, linen fabric, wool fabric, radios, refrigerators, other consumer goods.

Industrial production growth rate: 8% (1999 est.)

Electricity—capacity: 7.21 million kW (1997)

Electricity—production: 21.893 billion kWh (1996)

Electricity—consumption per capita: 3,144 kWh (1996)

Agriculture—products: grain potatoes vegetables; meat milk

Exports:

total value: $6 billion (f.o.b. 1999)

commodities: machinery and transport equipment chemicals foodstuffs

partners: Russia, Ukraine, Poland, Germany, Lithuania

Imports:

total value: $6.4 billion (c.i.f. 1999)

commodities: fuel natural gas industrial raw materials textiles sugar

partners: Russia, Ukraine, Poland, Germany

Debt—external: $1.1billion (1998 est.)

Economic aid:

recipient: ODA $194.3 million (1995)

note: commitments $3 930 million ($1 845 million disbursements) 1992-95

Currency: Belarusian rubel (BR)

Exchange rates: Belarusian rubels per US$1— 2 150 (22 Nov. 2006), After 2002 the ecomomical activity became much better thanks to stopping of hyperinflation and the steady grouth of level of life.

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