The economy grew 4.6% year-on-year in January, with the real (non-nominal) GDP measure showing 11.6% growth. The National Bank chalks it up to a result of increased state wages and rising labor productivity from last year.
Exports of goods and services were up 24% year-on-year at $28.65bn and imports were up 23.3% year-on-year at $31.57bn. Rising oil prices undoubtedly helped buy Minsk a cushion to better afford rising imports. The National Bank calculated a 14.9% increase in the value of export goods against a roughly 14.2% increase in spot oil prices over the course of 2017.
Budget revenues were up 2.9% year-on-year for 2017 and the resource sector still provides over half of the budget. Falls in defense spending and industrial production paved the way for a 27% slump in non-oil and gas budget revenues last year.
Minsk successfully raised $600mn in Eurobonds issued in February and plans $1bn a year. It also expects to receive a $200mn tranche from the Eurasian Stabilization Fund in February. The budgetary outlook remains troublesome given oil dependence.
The National Bank reduced the refinancing rate from 11% to 10.5% and the ruble deposits are showing growth. Higher wages and more attractive rates are pushing people to deposit savings in rubles.
In business, private enterprises’ debts rose 11.5% to BYN66.15bn, with overdue debts up down 6.6% to BYN2.46bn. Net profits doubled. All is not complete doom and gloom.
Still, the situation isn’t exactly rosy. The IMF estimates that 32.4% of Belarus’ GDP was tied up in the shadow economy as of 2015 per a study covering 1991-2015. Naturally, much money vanishes into spending and ventures not captured statistically.
Belarus attracted $7.6bn in FDI in 2017 (lead by 38% from Russia, 26.6% from the U, and 7.2% from Cyprus). China extended $1 billion in credit to two state banks. Beijing’s investment strategy is debt-driven, as elsewhere. Bad news for Minsk.
1.0 Executive summary
3.0 Macro Economy
3.1 Macroeconomic overview
4.0 Real Economy
4.1 Industrial production
4.3 Fixed investment
4.5 Labour and income
4.5.1 Labour market, unemployment dynamics
4.5.1 Nominal wages dynamics
4.5.2 Retail sector dynamics
5.0 External Sector & Trade
5.1 External sector overview
5.2 Balance of payments, current account
5.2.1 Import/export dynamics
5.2.4 Gross international reserves
6.0 Public Sector
6.1.1 Budget dynamics - tax issues
6.1.2 Budget dynamics - funding, privatization
7.1 FX issues
8.0 Financial & capital markets
8.1 Bank sector overview
8.2 Central Bank policy rate
8.4 International ratings
9.0 Industry & Sectors
9.1.6 Agriculture sector news
9.1.7 TMT sector news
9.2 Major corporate news
9.2.6 Agriculture corporate news