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CONSULTING

Updated: 03.07.2009

BELARUS


Area: 207,600 sq. km
Capital: Minsk
Population: 9,685,768 (Urban 73%; rural 27%) (July 2008 est.)
Annual growth rate: -0.393% (2008 est.)
Languages: Belarusian and Russian (official)
Literacy: 99.6%
Government Type: Republic
Neighboring countries: Lithuania, Latvia, Russia, Ukraine, Poland
Memberships: CIS, EAPC, EBRD, IBRD, ILO, IMF, Interpol, NATO's Partnership for Peace, OSCE, UN, World Bank, WHO
Currency: 2,113.5 BYR (Belarusian rubles) = U.S. $1 (October 2008)

ECONOMY

GDP: $44.77 billion (2007)
Annual growth rate: 8.2% (2007)
GDP (PPP): $103.5 billion (2007 est.)
GDP per capita (PPP): $10,600 (2007)
GDP composition by sector: agriculture: 8.7%, industry: 40.6%, services: 50.6% (2007 est.)
Major Industries: machine building and metalworking, chemical and petrochemical, food, textiles, woodworking, radio-electronics, agriculture
Inflation (consumer prices): 8.4% (2007 est.)
Work force: 4,460 mln (2008): Industry—34.7%; agriculture and forestry--14%; construction--7.9%; transportation, communications--7.6%; trade, catering--12.2%; education--10.7%; other--24.3%
Unemployment: 1,1 % (1Q, 2008)
Industrial production growth rate: 5% (2007 est.)
Trade (2007): Exports: $24.47 billion f.o.b.:
Imports: $28.32 billion f.o.b.:
FDI: $2.011 billion (Dec, 2008)
FDI abroad: $5.9 million ( Jan-Sept, 2008)

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. Nevertheless, GDP growth has been strong in recent years, reaching nearly 7% in 2007, despite the roadblocks of 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. Trade with Russia - by far its largest single trade partner - decreased in 2007, largely as a result of a change in the way the Value Added Tax (VAT) on trade was collected. Russia has 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 - 80% will go to Russia in 2008, and 85% in 2009. Russia also increased Belarusian natural gas prices from $47 per thousand cubic meters (tcm) to $100 per tcm in 2007, and plans to increase prices gradually to world levels by 2011. Russia's recent policy of bringing energy prices for Belarus to world market levels may result in a slowdown in economic growth in Belarus over the next few years. Some policy measures, including tightening of fiscal and monetary policies, improving energy efficiency, and diversifying exports, have been introduced, but external borrowing has been the main mechanism used to manage the growing pressures on the economy.


TARGET SECTORS

State support through different governmental programmes
• “development of rural areas”
• “small cities development”
• “tourism development”

Other priority sectors:
• financial sector
• energy saving technologies
• science and innovative technologies

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