Belarusian Economic Research and Outreach Center

Belarusian Economy in 2017: Catch-up Growth vs. the Burden of Pending Structural Weaknesses

This policy paper deals with Belarusian macroeconomic situation in 2017. The study admits that a long period of adjustment to new institutional environment, which was associated with structural slowdown, has ended in 2017 and catch-up growth began. This growth mainly stemmed from favorable external environment. The policies enhancing price and external stability also contributed into growth. In 2017, Belarus has displayed historical (or 10 year) records in inflation rate and current account balance. This allowed quitting from restrained economic policies thus emancipating domestic demand. Further, labor market reanimated, causing growth in real wages. However, catch-up growth in 2017 was still unsustainable. It reflected pending structural weaknesses and correspondingly poor growth potential. Some progress in institutional policies that took place in 2015-2016 was fading out. At the same time, the government intensified the attempts aimed at establishing ‘new economy’. The latter is the part of the concept of dual economy with dual development tracks, which tends to become the background for the development policies.

The Policy Paper is available only in Russian.