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Belarus Economy

    Economy—overview: 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 re-imposed administrative controls over prices and currency exchange rates and expanded the state's right to intervene in the management of private enterprise. This produced a climate hostile to private business, inhibiting domestic and foreign investment. The Government of Belarus has artificially revived economic output since mid-1996 by pursuing a policy of rapid credit expansion. In a vain attempt to keep the rapidly rising inflation in check, the government placed strict price controls on food and consumer products, which resulted in food shortages. Long lines for dairy products, chicken, and pork became common in the closing months of 1998. With the goal of slowing down the devaluation of the Belarusian ruble, LUKASHENKO in 1997 introduced a new, complex system of legal buying/selling hard currencies. The new "command" system proved to be totally unworkable and resulted in galloping devaluation. In addition to the burdens imposed on businesses by high inflation and an artificial currency regime, businesses have also been subject to pressure on the part of central and local governments, e.g., arbitrary changes in regulations, numerous rigorous inspections, and retroactive application of new business regulations prohibiting practices that had been legal. A further economic problem is the sizable trade deficit.

    GDP: purchasing power parity—$53.7 billion (1998 est.)

    GDP—real growth rate: 7% (1998 est.)

    GDP—per capita: purchasing power parity—$5,200 (1998 est.)

    GDP—composition by sector:
    agriculture: 20%
    industry: 43%
    services: 37% (1997 est.)

    Population below poverty line: 77% (1997 est.)

    Household income or consumption by percentage share:
    lowest 10%: 4.9%
    highest 10%: 19.4% (1993)

    Inflation rate (consumer prices): 182% (1998)

    Labor force: 4.3 million (1998)

    Labor force—by occupation: industry and construction 40%, agriculture and forestry 19%, services 41% (1997 est.)

    Unemployment rate: 2.3% officially registered unemployed (December 1998); large number of underemployed workers

    Budget:
    revenues: $4 billion
    expenditures: $4.1 billion, including capital expenditures of $180 million (1997 est.)

    Industries: tractors, metal-cutting machine tools, off-highway dump trucks up to 110-metric-ton load capacity, wheel-type earth movers for construction and mining, eight-wheel-drive, high-flotation trucks with cargo capacity of 25 metric tons for use in tundra and roadless areas, equipment for animal husbandry and livestock feeding, motorcycles, television sets, chemical fibers, fertilizer, linen fabric, wool fabric, radios, refrigerators, other consumer goods

    Industrial production growth rate: 11% (1998 est.)

    Electricity—production: 26.1 billion kWh (1998)

    Electricity—production by source:
    fossil fuel: 99.92%
    hydro: 0.08%
    nuclear: 0%
    other: 0% (1997)

    Electricity—consumption: 33.7 billion kWh (1997)

    Electricity—exports: 2.7 billion kWh (1997)

    Electricity—imports: 10.3 billion kWh (1997)

    Agriculture—products: grain, potatoes, vegetables, sugar beets, flax; beef, milk

    Exports: $7 billion (f.o.b., 1998)

    Exports—commodities: machinery and transport equipment, chemicals, foodstuffs

    Exports—partners: Russia, Ukraine, Poland, Germany

    Imports: $8.5 billion (c.i.f., 1998)

    Imports—commodities: fuel, natural gas, industrial raw materials, textiles, sugar, foodstuffs

    Imports—partners: Russia, Ukraine, Poland, Germany

    Debt—external: $1.03 billion (1998 est.)

    Economic aid—recipient: $194.3 million (1995)

    Currency: Belarusian rubel (BR)

    Exchange rates: Belarusian rubels per US$1—139,000 (25 January 1999 official Belarusian exchange rate), 46,080 (2nd qtr 1998), 25,964 (1997), 15,500 (yearend 1996), 11,500 (yearend 1995), 10,600 (yearend 1994)

    Fiscal year: calendar year

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Revised 1-Mar-99
Copyright © 1999 Photius Coutsoukis (all rights reserved)