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Belarus Economic Update – April 2015


Stability-oriented macroeconomic tightening has occurred in response to a deteriorating external environment. The economy is expected to enter into a recession during 2015, which is likely to endure in 2016. The current economic challenges and domestic structural constraints reinforce the need for a comprehensive economic transformation.

Recent Economic Developments

Weak external demand from the key trading partners of Russia and Ukraine has depressed output in early 2015.

Despite tightening of monetary policy, inflation has been high due to the impact from exchange rate depreciation.

Although net exports slightly improved, foreign exchange reserves declined due to large external debt repayments.

Despite the weaker economy, the Government has managed to keep fiscal policy prudent.


Medium-term Outlook

Belarus is expected to enter into a recession during 2015, which is likely to continue in 2016.

Clear and consistent structural transformation policies would allow the economy to adjust more quickly to the changing environment and restore growth.

Some reform measures can be implemented in the short run, while others are recommended for the medium run.


Ruslan Piontkivsky

Kiryl Haiduk