Economy Overview
Belarus's economy in 2006 posted more than 8% growth. Trade with Russia - by far its largest single trade partner - decreased in 2006, largely as a result of a change in the way the Value Added Tax (VAT) on trade was collected. Trade with European countries increased. Belarus has seen little structural reform since 1995, when President LUKASHENKO launched the country on the path of "market socialism." In keeping with this policy, LUKASHENKO reimposed administrative controls over prices and currency exchange rates and expanded the state's right to intervene in the management of private enterprises. Since 2005, the government has re-nationalized a number of private companies. In addition, businesses have been subject to pressure by central and local governments, e.g., arbitrary changes in regulations, numerous rigorous inspections, retroactive application of new business regulations, and arrests of "disruptive" businessmen and factory owners. A wide range of redistributive policies has helped those at the bottom of the ladder; the Gini coefficient is among the lowest in the world. Because of these restrictive economic policies, Belarus has had trouble attracting foreign investment, which remains low. Growth has been strong in recent years, despite the roadblocks in a tough, centrally directed economy with a high, but decreasing, rate of inflation. Belarus receives heavily discounted oil and natural gas from Russia and much of Belarus' growth can be attributed to the re-export of Russian oil at market prices. This growth will be threatened in 2007, however, when Russia raises energy prices closer to world market prices for Belarus. Russia is planning to increase Belarusian gas prices from $47 per thousand cubic meters (tcm) to $100 per tcm for 2007, gradually increasing to world prices by 2011. Russia has also introduced an export duty on oil shipped to Belarus, which will increase gradually through 2009, and a requirement that Belarusian duties on re-exported Russian oil be shared with Russia - 70% will go to Russia in 2007, 80% in 2008, and 85% in 2009.
Agriculture Products
grain, potatoes, vegetables, sugar beets, flax; beef, milk
Industries
metal-cutting machine tools, tractors, trucks, earthmovers, motorcycles, televisions, chemical fibers, fertilizer, textiles, radios, refrigerators
Industrial Production Growth Rate
15.6% (2005 est.)
Labor Force
4.3 million (31 December 2005)
Electricity production
29.08 billion kWh (2005)
Electricity Consumption
29.49 billion kWh (2005)
Electricity Exports
5.053 billion kWh (2005)
Electricity Imports
9.091 billion kWh (2005)
Unemployment Rate
1.6% officially registered unemployed; large number of underemployed workers (2005)
Population Below Poverty Line
27.1% (2003 est.)
Household Income or Consumption by Percentage Share
Lowest 10%: 3.4%
Highest 10%: 23.5% (2002)
Distribution of Family Income Gini Index
29.7 (2002)
Budget
Revenues: $13.24 billion
Expenditures: $13.76 billion (2006 est.)
Commercial Bank Prime Lending Rate
Market Value of Publicly Traded Shares
$NA
Reserves of Foreign Exchange and Gold
$1.099 billion (2006 est.)
Debt External
$5.929 billion (2006 est.)
Stock of Direct Foreign Investment at Home
Stock of Direct Foreign Investment Abroad
Exchange Rates
Belarusian rubles per US dollar - 2,144.6 (2006), 2,150 (2005), 2,160.26 (2004), 2,051.27 (2003), 1,790.92 (2002)
