Belarus Economy 2007

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.

GDP (purchasing power parity):
$83.1 billion (2006 est.)

GDP (official exchange rate):
$28.98 billion (2006 est.)

GDP - real growth rate:
9.9% (2006 est.)

GDP - per capita (PPP):
$8,100 (2006 est.)

GDP - composition by sector:
agriculture: 9.2%
industry: 41.7%
services: 49.1% (2006 est.)

Labor force:
4.3 million (31 December 2005)

Labor force - by occupation:
agriculture: 14%
industry: 34.7%
services: 51.3% (2003 est.)

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)

Inflation rate (consumer prices):
7% (2006 est.)

Investment (gross fixed):
28.3% of GDP (2006 est.)

Budget:
revenues: $13.24 billion
expenditures: $13.76 billion (2006 est.)

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.)

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)

Oil - production:
34,260 bbl/day (2004 est.)

Oil - consumption:
165,000 bbl/day (2004 est.)

Oil - exports:
249,900 bbl/day (2004 est.)

Oil - imports:
378,200 bbl/day (2004 est.)

Oil - proved reserves:
198 million bbl (1 January 2006)

Natural gas - production:
165 million cu m (2005 est.)

Natural gas - consumption:
19.47 billion cu m (2005 est.)

Natural gas - exports:
0 cu m (2005 est.)

Natural gas - imports:
19.31 billion cu m (2005)

Current account balance:
$-1.512 billion (2006 est.)

Exports:
$19.84 billion f.o.b. (2006 est.)

Exports - commodities:
machinery and equipment, mineral products, chemicals, metals, textiles, foodstuffs

Exports - partners:
Russia 34.7%, Netherlands 17.7%, UK 7.5%, Ukraine 6.3%, Poland 5.2% (2006)

Imports:
$22.24 billion f.o.b. (2006 est.)

Imports - commodities:
mineral products, machinery and equipment, chemicals, foodstuffs, metals

Imports - partners:
Russia 58.6%, Germany 7.5%, Ukraine 5.5% (2006)

Economic aid - recipient:
$53.76 million (2005)

Reserves of foreign exchange and gold:
$1.099 billion (2006 est.)

Debt - external:
$5.929 billion (2006 est.)

Market value of publicly traded shares:
$NA

Currency (code):
Belarusian ruble (BYB/BYR)

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)