REPUBLIC OF BELARUS
OUTLINE: Background Economic development since 1991 Preconditions and impact of world financial crisis in 2008 Devaluation of currency in 2009 Conclusion
BACKGROUND Total area 207,600 sq km Population 9,648,533 (2009) GDP-real growth rate 8.1% (2008) GDP per capita $12,000 (2008) Labor force 4.3 million (2005) Official unemployment rate 1.6% (2005) Inflation rate (consumer prices) 15.5 % (2008) CA balance -$3.832 billion (2008)
S INCE INDEPENDENCE 1991: Source: Country Economic Memorandum for the Republic of Belarus, World Bank
A VERAGE ANNUAL GDP GROWTH, % Source: World Bank ECA Regional Database
A VERAGE ANNUAL INFLATION, % Source: World Bank ECA Regional Database
S TRUCTURE OF EXPORT OF PRODUCTION FROM THE R EPUBLIC OF B ELARUS IN 2007, IN COST EXPRESSION Source: IRUE "National center of marketing and price study"
GLOBAL FINANCIAL CRISIS, 2008 P RECONDITIONS : High degree of government interventions Underdeveloped stock market High dependence on trade with Russia Slow pace of geographic export diversification
GLOBAL FINANCIAL CRISIS I MPACT : State dominated economy, limited contact with world financial markets, less dependent on international credit not severe effect of financial crisis Sharp decline in Russian economic subsidies and sharp decline in exports and imports to Russia due to financial crisis affected Belarusian economy
IMPORTS AND EXPORTS OF GOODS, RUSSIA
JANUARY 2009 CURRENCY DEVALUATION immediate 20 % devaluation in the BYB, implemented on January 2, 2009 $2.5bn (£1.7bn, €1.8bn) IMF emergency loan, $1 bn credit from Russia, $ 500 mln from Venezuela the central bank raised interest rates from 12 to 14% possible devaluation in the future by 25 %
BELARUSIAN RURLE OFFICIAL AVERAGE EXCHANGE RATE AGAINST FOREIGN CURRENCY PeriodRussian ruble US dollar Euro 2008 December January February Source: National Bank of Belarus
CONCLUSION State-dominated economy High dependence on single and unstable market – Russia Impact of financial crisis Need for economic reforms Questionable effect of currency devaluation
REFERENCES CIA factbook National Bank of Belarus IMF IPM Research Center Financial Times, UK Deutsche Welle Narodnaya Volya, Belarusian news
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