Republic of Belarus. Recent social and economic trends and short-term prospective. September 2019.

27 January 2020

In 2018, strong growth in consumption led the acceleration of economic growth to 3%. Wages and credit growth supported consumer demand. Conservative interest rate policy allowed the National Bank of Belarus to keep inflation within the targeted value. Favorable market conditions, reinforced by reduced public state financial support to the SOEs, ensured the increase in the Augmented Budget surplus. Despite pressures coming from imports of consumption goods, the current account deficit continued to decelerate as a result of the favorable global price of oil and potassium. According to EFSD estimates, the Belarusian economy is expected to slow down to 2.4% in 2019 as a result of a weakened external and domestic demand. At the same time, in the medium term, there are still risks to debt sustainability associated with a slowdown in economic growth and the tax maneuver in Russia.