Belarus Economic Outlook
July 2, 2019The economy continues to reel. Russia’s gradual elimination of export duties on oil and raising of the mineral extraction tax has marked the end of preferentially cheap oil imports to Belarus. This, along with contamination of the Druzhba pipeline from Russia, has slashed exports, and the industrial sector consequently contracted in May for the first time in over two years. Growth has also been dragged down by lower agricultural output, owing to the dearth of rainfall. That said, household spending likely remained resilient, evidenced by robust retail sales growth in April–May. Meanwhile, tensions with Russia are at fever-pitch: Russia will not be awarding any further loans and has also refused to compensate Belarus for loss of earnings caused by the oil contamination, until the two countries agree to a shared vision of integration. In response, Belarus has threatened the Russian government with legal action.
Belarus Economic GrowthGrowth is set to weaken this year. Private consumption is seen losing steam amid higher inflation and unemployment rate, weak business confidence will weigh on fixed investment, while Russia’s lackluster performance will likely drag on exports. A rebound in government spending ahead of the 2020 election should cushion the slowdown, but also poses downside fiscal risks. FocusEconomics analysts expect growth of 2.4% in 2019, which is unchanged from last month’s forecast, and 2.2% in 2020.
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|Exchange Rate||2.03||-0.36 %||Jul 11|
|Stock Market||0.1||0.0 %||Jul 11|
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Belarus Economic News
July 17, 2019
Industrial production fell 0.9% year-on-year in June, following a 3.3% contraction in May.
July 11, 2019
Consumer prices fell 0.1% in June following a 0.3% upturn in May.
June 17, 2019
Industrial production shrank 3.3% year-on-year in May, after April’s 2.1% expansion, owing to a deteriorating in the manufacturing, and mining and quarrying sectors.
June 10, 2019
Consumer prices rose 0.3% in May, following flat growth in April, largely reflecting higher prices for non-food goods and services. Inflation accelerated to 6.2% in May (April: 5.5%), moving further above the Central Bank’s 5.0% target.
May 17, 2019
Industrial production grew 2.1% year-on-year in April, accelerating from March’s 0.9% result, owing to stronger production in the manufacturing, and mining and quarrying sectors.