Belarus: Growth slumps to three-year low in 2019
According to the first national accounts estimate released by Belarus’ Statistical Institute (Belstat), annual growth sunk to 1.2% in 2019 (2018: +3.1% year-on-year), marking the softest expansion since 2016. The annual reading suggested that growth picked up slightly in Q4 2019 compared to the previous quarter, although quarterly data has not yet been released by Belstat.
The annual downturn was largely broad-based, according to the Belstat release. The all-important manufacturing sector led the downturn, with deteriorations across the wholesale and retail trade, construction, and electricity, gas, steam, hot water and air conditioning supply sectors further weighing on the overall result. This more than offset a marked upturn in the agriculture, forestry and fishery sector.
The economy is expected to pick up momentum this year, thanks to an acceleration in government spending ahead of the elections and a less downbeat external sector. Reduced wage gains are set to weigh on private consumption growth, however, while fixed investment is likely seen losing traction amid deteriorating sentiment. Moreover, downside risks stem from bad loans in state-owned banks and uncertainty over economic and political relations with its largest ally, Russia.