Belarus GDP Q3 2020

Belarus

Belarus: GDP contraction eases in Q3

October 16, 2020

A preliminary estimate revealed the economy shrank 1.3% in the first three quarters of the year, easing from H1’s 1.8% decrease.

The slight improvement came on higher agricultural production, which was up 5.5% (H1: +3.9%) and a smaller decrease in the manufacturing sector (Q1–Q3: -1.4%; H1: -3.2%), likely thanks to a pickup in external demand. However, this was likely countered somewhat by widespread protests dragging on domestic activity, while the mining sector remained in contractionary territory, falling by 1.8% in January–September (H1 2020: -1.7%). Moreover, the construction sector lost steam, easing from 6.0% growth in annual terms in the first half of the year to only 4.0% in Q1–Q3.

Looking ahead, the economy should recover somewhat but remain fragile, weighed on by protests and political instability. As Chris Portman, senior economist at Oxford Economics, stated: “Post-election disruption, worsened by ongoing strains from the coronavirus pandemic, is holding back the private sector expansion needed to avoid a jump in unemployment as public sector inefficiencies are belatedly tackled. Downside risks are also kept high in 2020-22 by likely public reaction against any Moscow-backed leadership change that lets Russia acquire more assets, and emigration of skilled younger workers in response to recession and clampdown if protestors’ demands are not met.”

FocusEconomics Consensus Forecast panelists expect the economy to expand 2.0% in 2021, which is down 0.3 percentage points from last month’s forecast. For 2022, panelists expect economic growth at 2.0%.


Author:, Junior Economist

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