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Belarus Economic Forecast

Belarus Economic Outlook

Cumulative GDP data revealed that the economy started the year on the back foot: the rate of contraction accelerated from Q4’s average of 4.7% to 5.0% in January, as the downturn in industrial output intensified. More positively, retail sales shrank at a softer clip, likely due to lower inflation. In other news, in mid-February, President Lukashenko stated that Belarusian troops would only be deployed alongside the Russian army if Belarus was attacked. Meanwhile, on 24 February, the U.S. expanded its sanctions on the country, broadly aligning them with those imposed by its European allies. On 1 March, Lukashenko met with Chinese leader Xi Jinping. They reiterated the strong bond between the two countries and called for a prompt peace deal between Russia and Ukraine.

Belarus Inflation

Inflation decreased to 12.0% in January from December’s 12.8%. The deceleration was driven by softer price pressures across the whole basket of goods. Going forward, our panelists project inflation to continue to decline due to price controls and lower commodity prices. However, price controls could lead to shortages and the emergence of a parallel market.

Belarus Economic Data

2017 2018 2019 2020 2021
Population (million) 9.5 9.4 9.4 9.4 9.4
GDP (USD bn) 55 60 64 61 68
GDP per capita (USD) 5 6 6 6 7
GDP (EUR bn) 48 51 58 54 58
GDP per capita (EUR) 5 5 6 5 6
GDP (BYN bn) 106 122 135 150 173
Economic Growth (Nominal GDP, ann. var. %) 11.4 15.7 10.1 11.1 15.7
Economic Growth (GDP, ann. var. %) 2.5 3.1 1.4 -0.7 2.3
Private Consumption (ann. var. %) 4.8 8.0 5.1 -1.5 4.6
Government Consumption (ann. var. %) -0.9 -0.4 0.5 -1.2 -1.1
Fixed Investment (ann. var. %) 5.5 4.4 6.2 -6.9 -5.1
Exports (G&S, ann. var. %) 7.5 3.8 1.0 -3.7 9.5
Imports (G&S, ann. var. %) 11.1 7.3 5.1 -7.4 5.8
Industrial Production (ann. var. %) 6.1 5.7 1.0 -0.7 6.5
Retail Sales (ann. var. %) 4.4 8.3 4.5 2.1 1.6
Unemployment (% of active population, aop) 5.7 4.8 4.2 4.1 3.9
Fiscal Balance (% of GDP) 2.9 4.0 2.6 -1.7 0.5
Public Debt (% of GDP) 53.2 47.5 41.0 47.5 -
Money (ann. var. of M2 %) 30.2 20.1 27.4 -3.3 19.8
Inflation (CPI, ann. var. %, eop) 4.6 5.6 4.7 7.3 10.0
Inflation (CPI, ann. var. %, aop) 6.0 4.9 5.6 5.5 9.5
Refinancing Rate (%, eop) 11.00 10.00 9.00 7.75 9.25
Exchange Rate (BYN per USD, eop) 2.0 2.2 2.1 2.6 2.6
Exchange Rate (BYN per USD, aop) 1.9 2.0 2.1 2.4 2.5
Exchange Rate (BYN per EUR, eop) 2.4 2.5 2.4 3.2 2.9
Exchange Rate (BYN per EUR, aop) 2.2 2.4 2.3 2.8 3.0
Current Account Balance (USD bn) -1 0 -1 0 2
Current Account Balance (% of GDP) -1.7 0.0 -1.9 -0.3 3.2
Merchandise Trade Balance (USD bn) -3 -3 -4 -2 -1
Merchandise Exports (USD bn) 29 33 32 28 39
Merchandise Imports (USD bn) 32 36 37 30 40
Merchandise Exports (ann. var. %) 24.2 16.5 -3.3 -12.3 37.9
Merchandise Imports (ann. var. %) 23.7 13.5 1.7 -17.2 31.5
Foreign Direct Investment (USD bn) 1 1 1 1 1
International Reserves (USD bn) 7 7 9 7 8
International Reserves (months of imports) 2.8 2.5 3.0 2.9 2.6
External Debt (USD bn) 40 39 41 42 42
External Debt (% of GDP) 72.8 65.5 63.2 68.6 61.5

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