ANALYSIS: Belarus’ economy growing thanks to individual sectors, investment activity in decline

Monthly overview of Belarus’ real economy sector, Jan-Mar 2021 MINSK, Apr 29 – PrimePress. A positive trend was observed in Belarus’ economy in Q1 2021. However, negative factors due to the pandemic and the tense domestic political situation in the country continue to have a destructive effect on the economy. The situation is exacerbated by increased administrative interference in economic processes, including politically motivated decisions. Table 1. Key indicators of Belarus’ macroeconomic performance: <table border="1" cellspacing="1" cellpadding="0"> <tbody> <tr> <td> Indicator </td> <td> Real figures, Jan 2021, billion Belarusian rubles </td> <td> Jan 2021 on Jan 2020, % </td> <td> Official forecast for 2021, % </td> </tr> <tr> <td> GDP </td> <td> 36.299 </td> <td> +0.9% </td> <td> +1.8% (+0.0% in Q1) </td> </tr> <tr> <td> Industrial output </td> <td> 33.761 </td> <td> +9.2% </td> <td> no forecast </td> </tr> <tr> <td> Fixed capital investments </td> <td> 5.674 (15.6% of GDP) </td> <td> minus 12.1% </td> <td> 21.3-21.7% of GDP </td> </tr> <tr> <td> Inflation growth since early 2021, % </td> <td> 3.8* </td> <td> 8,5 (Mar 2021 on Mar 2020) </td> <td> 5% at most </td> </tr> <tr> <td> Foreign trade balance (goods and services), USD million </td> <td> +756.1** </td> <td> +396.4** </td> <td> no forecast </td> </tr> <tr> <td> Real disposable household incomes, year on year, % </td> <td> +3.3** </td> <td> +7.1*** </td> <td> +1.6% (+2.0% in Q1) </td> </tr> </tbody> </table> * year to date ** Jan-Feb 2020 *** Jan-Feb 2019 Few growth drivers ensure positive GDP dynamics At the end of the first quarter of 2021 the Belarusian economy demonstrated positive growth rates, mainly due to the low comparative base of the previous year in a number of sectors. In January-March 2020 industrial output was affected by disruptions in Russian oil supplies and problems with exports of potash fertilizers and oil products. In addition, the abnormally warm winter of 2019/2020 affected output in the energy sector. This year, these sectors became the growth drivers, which supported the country’s GDP. According to the National Statistical Committee of Belarus (Belstat), the country’s GDP grew by 0.9% in Q1 to Br36.299bn compared to a 0.2% decline in Q1 2020. Gross value added (GVA) accounted for 86.1% of the GDP in Q1 2021, and net taxes on products – for 13.9%. The net taxes on products are the difference between gross taxes on products and subsidies. Gross product taxes are taxes and levies such as VAT, excise taxes and import duties. Gross value added increased by 0.7% in Q1 in comparable prices, while net taxes on products increased by 1.9%. A more intensive growth in net taxes on products was due to an increase in the base rates of many taxes, as well as the abolishment of a number of VAT exemptions. As a result, in Q1 the contribution of net taxes on products to economic growth was about 0.26 p.p., while gross value added was about 0.60 p.p. Thus, net taxes on products accounted for more than a quarter of economic growth in January-March 2021. The GDP growth drivers in Q1 2021 were the manufacturing and energy sectors. In January-March, these economic activities contributed around 2.5 p.p. to GDP growth. The dynamics of the indicators of aggregated activities are multidirectional. In manufacturing, growth occurred due to the low base of 2020 (industry’s value added fell by 2.1% in Q1 2020). Early last year, output in industry was affected by disruptions in Russian oil supplies and problems with exports of potash fertilisers and oil products. In addition to last year's warm winter, output growth in the energy sector was also affected by the start of the pilot operation phase of the first power unit at the Belarusian NPP on 22 December 2020. According to data from the Ministry of Energy, as of early April, the first NPP unit has generated 1.8 billion kWh of electricity since its incorporation into the country's unified grid. A sharp drop in gross value added in construction ensured that Belarus’ GDP growth slowed by about 1 p.p. in January-March. The drop in output in construction is occurring at the background of shrinking fixed capital investment. In January-March 2021, capital investments fell by 12.1%, and by 16.4% in March. The decline in added value in transport and logistics in January-March 2021 ensured a slowdown of the Belarusian economy by about 0.4 p.p. Passenger transportation decreased by 18.1% year on year and freight transportation by 5.8%. At the same time, the decrease in passenger and freight traffic in 2021 occurred due to the low base of 2020. This has been the second consecutive year of decline in transport. The contribution of trading companies to the GDP in Q1 2021 is close to negative. However, the trends in wholesale and retail trade are unequal. While the wholesale turnover increased by 4% in January-March, the retail turnover decreased by 4.5%. The latter indicates a depression on the consumer market. At the turn of Q3-Q4 2020, there was a sharp slowdown in the growth rate of value added in the ITC sector, which includes telecommunications companies as well as IT companies. This slowdown continued in the first quarter of 2021. As a result, while information and communication had previously accounted for up to half of Belarus’ GDP growth, in January-March 2021 the contribution of this section was comparable to that of net taxes on products. Overall, the low comparative base will continue to support the performance of the Belarusian economy in Q2 2021. For reference, in Q2 2020 the country’s GDP fell by 3.3%. This drop occurred against the backdrop of an acute phase of the global economic crisis, as well as a temporary absence of large shipments under long-term contracts for potash supplies to India and China. In this context, the authorities can be expected to have little difficulty maintaining a positive trend in key gross figures in April and June of this year. The official socio-economic development forecast for 2021 was prepared by the government in autumn 2020 and approved almost unchanged at the end of the year. According to this forecast, Belarus’ GDP should grow by at least 1.8% under the target scenario. International institutions and banks do not share the optimism of the authorities. The “best” available forecast was formulated in January by the Sberbank - 1% GDP growth. The baseline forecast by the Eurasian Development Bank, presented in March, suggests growth of only 0.1%. Even more pessimistic are the risk scenario by the EDB (minus 1.4%) and forecasts by the World Bank (minus 2.2%) and the IMF (minus 0.4%). Decline in investment activity Political uncertainty combined with external sanctions imposed on Belarus is deterring potential investors. The situation is aggravated by a shortage of resources in the state budget, as well as ruble liquidity of Belarusian banks. In these circumstances, Belarusian companies have to rely mainly on their own resources, while foreign investors are very cautious about implementing projects in Belarus. According to Belstat, in Q1 2021, the volume of fixed capital investment decreased by 12.1% year on year, while in January-March 2020 it increased by 4%. Total fixed capital investments in January- March 2021 stood at Br5.674 billion. The volume of construction and installation works (including equipment installation) amounted to Br2.935 billion, down 13% year on year. The cost of machinery and equipment amounted to Br2.080 billion, down 12.3%. Thus, the two main components of investment - construction and installation works, and the cost of purchasing machinery, equipment, and vehicles - are declining. The decline in investments may be attributed to the tailoring of the 2021 budget plan by increasing the share of spending on current needs at the expense of capital needs, as well as the move by the EBRD and the EIB to freeze the financing of new infrastructure projects. As of April 1, 2021, there were 6,300 unfinished construction projects (excluding individual developers and small businesses), unchanged year to date. At the same time, 50.5% of the objects were under construction for longer than standard terms of construction (51.3% at the beginning of the year). Temporarily suspended and mothballed construction of 1,000 objects (corresponds to the level as of Jan 1, 2021). In Q1 2021 the volume of funds invested in housing construction was Br1.4 billion or 24.9% of the total volume of investments in fixed capital. The volume of investments in this area decreased by 0.3% year on year in comparable prices. In January-March 2021, 1.127 million square metres of dwelling houses was commissioned, which is 17.9% more than in the first quarter of 2020. Of the total volume of dwelling houses commissioned over the said period, 39.2% was built for the citizens registered as being in need of housing improvement (34.7% the year before), including 28.6% with state support – partially at the expense of soft loans from state-owned banks (25.5%). As for the sources of funding for fixed capital investment, we can note the still predominant share of enterprises’ own funds. In January-March 2021, these investments made Br2.460bn or 43.3% of the total volume of fixed capital investments (42.8% a year ago). The year-on-year decline was 11% in comparable prices. In second place were investments at the expense of budget funds. In Q1 2021, investments at the expense of national budget amounted to Br577.6 million, which was 12.1% less year on year in comparable prices compared, while investments from local budgets - Br356.5 million, down by 28.3% year on year. Their total share in the volume of investments decreased from 18.1% to 16.5%. The third place is occupied by investments in fixed assets through bank credits, which in January-March 2021 decreased by 12.7% and amounted to Br771.5 million. The share of this source in the total volume of investment amounted to 13.6% against 13.4% in Q1 2020. From the point of view of the structure of sources of capital investment financing, the decline in foreign investments (excluding loans of foreign banks) is also noteworthy. According to Belstat, in January-March 2021, they amounted to Br134.8 million, down 37.3% year on year. Their share in the total volume of foreign investments fell to 2.4% against 3.3% in Q1 2021. Foreign investors began abandoning investment projects in Belarus as early as 2020, amid the unfolding political crisis. In 2021, their interest in the country remains low, which is partly due to the pressure of sanctions imposed by Western countries. Thus, we can note a general decline in investment activity in the Belarusian economy amid the global economic crisis, as well as domestic uncertainty. Govt downgrades inflation forecast for 2021 Inflation acceleration observed in late 2020, due to the weakening of the Belarusian ruble, as well as increased inflation expectations of economic agents, have moved into 2021. Early this year inflation continued to accelerate under the influence of further increases in global food prices, as well as the prices of imported non-food products. The authorities themselves provided an additional pro-inflationary impact in the domestic market by cancelling a number of VAT exemptions. According to Belstat, by the end of March consolidated inflation made 8.5% in annual terms against 8.7% a month before. The prolonged and significant deviation of inflation from the original forecast for 2021 (no more than 5% year-on-year in December) forced the National Bank to revise its inflation forecast and raise the refinancing rate. The regulator last raised the key rate in 2015. According to the National Bank, taking into account the impact of various factors, the increase in consumer prices in December 2021 is estimated to be “close to” 7% year-on-year. "Going forward, annual inflation will continue to slow down and from the second quarter of 2022 is estimated at a medium-term target of close to 5 per cent,” the National Bank said in a statement after its monetary policy board meeting on April 14, 2021. Among the likely factors that will have a negative impact on inflation in Belarus in the near future, the regulator mentions the increased inflationary background in the global economy, as well as in the countries, which are major trading partners of Belarus. At the same time, the impact of food prices shocks as well as the pandemic consequences in terms of rising costs of imported non-food items may be more significant in Belarus, the National Bank said. The National Bank has estimated that weak consumer and investment demand within the country will act as deterrents to inflation in the near future. Meanwhile, according to Belstat, consumer prices in Belarus rose by 0.7% month on month in March 2021 after a 1.9% increase in February. Food prices rose by 0.4% month on month (+7.8% year on year), non-food products - by 1.4% (+9.5% yoy). Services tariffs increased by 0.3% (+8.2% yoy). The annual core inflation in Belarus moderately slowed down to 8.2% in March 2021 against 8.3% a month earlier. Trend inflation in March was 6.7% vs. 6.5% in February. Regulated prices and tariffs rose by 8.7% year on year compared to 8.5% in February. According to MART, in March the prices of spirits and tobacco products were increased compared to February (by 0.5% and 0.7% on average, respectively), medicines (1.8%) and motor fuel (2.3% on average). The growth of seasonal prices (prices of fruit and vegetable products) slowed down to 12.8% against 15.9% a month before. Accordingly, the contribution of these indicators to the overall inflation rate changed. In 2021, the authorities introduced and officially set a consumer price target for socially important commodities (essential goods). According to the government's forecasts, the indicator should not exceed 4.9% at the end of the year. However, in the first quarter of 2021, consumer prices for socially important goods increased by 3.4%, while the forecast for that period was not more than 2.5%. Thus, inflation risks remain elevated in Belarus due to both external and internal factors. In this context, it is worth mentioning the existing high inflation expectations in the economy, fuelled by the statements and actions of the authorities in restraining price increases. Economic recovery depends on overcoming political crisis Economic growth in Belarus this year has been supported by administrative methods (including by means of artificially discharging warehouses in manufacturing industry and directed lending), as well as at the expense of last year’s low comparative base. However, administrative methods do not address the previously accumulated imbalances, nor do they help to resolve the political crisis in which the country has been dwelling after the 2020 presidential election. The post-election sanctions imposed by Western countries have already effectively blocked foreign investment in Belarus. Belarusian businesses face barriers and increased risks to further development. The findings of a survey conducted by Satio, with executives of private and state-owned companies interviewed, indicate that economic actors expect the country's economy to recover no earlier than 2024 if the political crisis continues, if it is overcome soon - in 2022. Economic actors understand that their operating environment can be substantially altered at any time based on the political priorities of the authorities, which holds back investment activity and economic growth in general. PrimePress Business Analysis Agency

2021-04-30

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ANALYSIS: Belarus’ economy growing thanks to individual sectors, investment activity in decline

Monthly overview of Belarus’ real economy sector, Jan-Mar 2021

MINSK, Apr 29 – PrimePress. A positive trend was observed in Belarus’ economy in Q1 2021. However, negative factors due to the pandemic and the tense domestic political situation in the country continue to have a destructive effect on the economy. The situation is exacerbated by increased administrative interference in economic processes, including politically motivated decisions.

Table 1. Key indicators of Belarus’ macroeconomic performance:

Indicator	Real figures, Jan 2021, billion Belarusian rubles	Jan 2021 on Jan 2020, %	Official forecast for 2021, %
GDP	36.299	+0.9%	+1.8% (+0.0% in Q1)
Industrial output	33.761	+9.2%	no forecast
Fixed capital investments	5.674 (15.6% of GDP)	minus 12.1%	21.3-21.7% of GDP
Inflation growth since early 2021, %	3.8*	8,5 (Mar 2021 on Mar 2020)	5% at most
Foreign trade balance (goods and services), USD million	+756.1**	+396.4**	no forecast
Real disposable household incomes, year on year, %	+3.3**	+7.1***	+1.6% (+2.0% in Q1)

* year to date

** Jan-Feb 2020

*** Jan-Feb 2019

Few growth drivers ensure positive GDP dynamics

At the end of the first quarter of 2021 the Belarusian economy demonstrated positive growth rates, mainly due to the low comparative base of the previous year in a number of sectors. In January-March 2020 industrial output was affected by disruptions in Russian oil supplies and problems with exports of potash fertilizers and oil products. In addition, the abnormally warm winter of 2019/2020 affected output in the energy sector.

This year, these sectors became the growth drivers, which supported the country’s GDP. According to the National Statistical Committee of Belarus (Belstat), the country’s GDP grew by 0.9% in Q1 to Br36.299bn compared to a 0.2% decline in Q1 2020.

Gross value added (GVA) accounted for 86.1% of the GDP in Q1 2021, and net taxes on products – for 13.9%. The net taxes on products are the difference between gross taxes on products and subsidies. Gross product taxes are taxes and levies such as VAT, excise taxes and import duties.

Gross value added increased by 0.7% in Q1 in comparable prices, while net taxes on products increased by 1.9%. A more intensive growth in net taxes on products was due to an increase in the base rates of many taxes, as well as the abolishment of a number of VAT exemptions. As a result, in Q1 the contribution of net taxes on products to economic growth was about 0.26 p.p., while gross value added was about 0.60 p.p.

Thus, net taxes on products accounted for more than a quarter of economic growth in January-March 2021.

The GDP growth drivers in Q1 2021 were the manufacturing and energy sectors. In January-March, these economic activities contributed around 2.5 p.p. to GDP growth.

The dynamics of the indicators of aggregated activities are multidirectional. In manufacturing, growth occurred due to the low base of 2020 (industry’s value added fell by 2.1% in Q1 2020). Early last year, output in industry was affected by disruptions in Russian oil supplies and problems with exports of potash fertilisers and oil products.

In addition to last year's warm winter, output growth in the energy sector was also affected by the start of the pilot operation phase of the first power unit at the Belarusian NPP on 22 December 2020. According to data from the Ministry of Energy, as of early April, the first NPP unit has generated 1.8 billion kWh of electricity since its incorporation into the country's unified grid.

A sharp drop in gross value added in construction ensured that Belarus’ GDP growth slowed by about 1 p.p. in January-March. The drop in output in construction is occurring at the background of shrinking fixed capital investment. In January-March 2021, capital investments fell by 12.1%, and by 16.4% in March.

The decline in added value in transport and logistics in January-March 2021 ensured a slowdown of the Belarusian economy by about 0.4 p.p. Passenger transportation decreased by 18.1% year on year and freight transportation by 5.8%. At the same time, the decrease in passenger and freight traffic in 2021 occurred due to the low base of 2020. This has been the second consecutive year of decline in transport.

The contribution of trading companies to the GDP in Q1 2021 is close to negative. However, the trends in wholesale and retail trade are unequal. While the wholesale turnover increased by 4% in January-March, the retail turnover decreased by 4.5%. The latter indicates a depression on the consumer market.

At the turn of Q3-Q4 2020, there was a sharp slowdown in the growth rate of value added in the ITC sector, which includes telecommunications companies as well as IT companies. This slowdown continued in the first quarter of 2021. As a result, while information and communication had previously accounted for up to half of Belarus’ GDP growth, in January-March 2021 the contribution of this section was comparable to that of net taxes on products.

Overall, the low comparative base will continue to support the performance of the Belarusian economy in Q2 2021. For reference, in Q2 2020 the country’s GDP fell by 3.3%. This drop occurred against the backdrop of an acute phase of the global economic crisis, as well as a temporary absence of large shipments under long-term contracts for potash supplies to India and China. In this context, the authorities can be expected to have little difficulty maintaining a positive trend in key gross figures in April and June of this year.

The official socio-economic development forecast for 2021 was prepared by the government in autumn 2020 and approved almost unchanged at the end of the year. According to this forecast, Belarus’ GDP should grow by at least 1.8% under the target scenario.

International institutions and banks do not share the optimism of the authorities. The “best” available forecast was formulated in January by the Sberbank - 1% GDP growth. The baseline forecast by the Eurasian Development Bank, presented in March, suggests growth of only 0.1%. Even more pessimistic are the risk scenario by the EDB (minus 1.4%) and forecasts by the World Bank (minus 2.2%) and the IMF (minus 0.4%).

Decline in investment activity

Political uncertainty combined with external sanctions imposed on Belarus is deterring potential investors. The situation is aggravated by a shortage of resources in the state budget, as well as ruble liquidity of Belarusian banks. In these circumstances, Belarusian companies have to rely mainly on their own resources, while foreign investors are very cautious about implementing projects in Belarus.

According to Belstat, in Q1 2021, the volume of fixed capital investment decreased by 12.1% year on year, while in January-March 2020 it increased by 4%.

Total fixed capital investments in January- March 2021 stood at Br5.674 billion. The volume of construction and installation works (including equipment installation) amounted to Br2.935 billion, down 13% year on year. The cost of machinery and equipment amounted to Br2.080 billion, down 12.3%.

Thus, the two main components of investment - construction and installation works, and the cost of purchasing machinery, equipment, and vehicles - are declining. The decline in investments may be attributed to the tailoring of the 2021 budget plan by increasing the share of spending on current needs at the expense of capital needs, as well as the move by the EBRD and the EIB to freeze the financing of new infrastructure projects.

As of April 1, 2021, there were 6,300 unfinished construction projects (excluding individual developers and small businesses), unchanged year to date. At the same time, 50.5% of the objects were under construction for longer than standard terms of construction (51.3% at the beginning of the year). Temporarily suspended and mothballed construction of 1,000 objects (corresponds to the level as of Jan 1, 2021).

In Q1 2021 the volume of funds invested in housing construction was Br1.4 billion or 24.9% of the total volume of investments in fixed capital. The volume of investments in this area decreased by 0.3% year on year in comparable prices. In January-March 2021, 1.127 million square metres of dwelling houses was commissioned, which is 17.9% more than in the first quarter of 2020.

Of the total volume of dwelling houses commissioned over the said period, 39.2% was built for the citizens registered as being in need of housing improvement (34.7% the year before), including 28.6% with state support – partially at the expense of soft loans from state-owned banks (25.5%).

As for the sources of funding for fixed capital investment, we can note the still predominant share of enterprises’ own funds. In January-March 2021, these investments made Br2.460bn or 43.3% of the total volume of fixed capital investments (42.8% a year ago). The year-on-year decline was 11% in comparable prices.

In second place were investments at the expense of budget funds. In Q1 2021, investments at the expense of national budget amounted to Br577.6 million, which was 12.1% less year on year in comparable prices compared, while investments from local budgets - Br356.5 million, down by 28.3% year on year. Their total share in the volume of investments decreased from 18.1% to 16.5%.

The third place is occupied by investments in fixed assets through bank credits, which in January-March 2021 decreased by 12.7% and amounted to Br771.5 million. The share of this source in the total volume of investment amounted to 13.6% against 13.4% in Q1 2020.

From the point of view of the structure of sources of capital investment financing, the decline in foreign investments (excluding loans of foreign banks) is also noteworthy. According to Belstat, in January-March 2021, they amounted to Br134.8 million, down 37.3% year on year. Their share in the total volume of foreign investments fell to 2.4% against 3.3% in Q1 2021.

Foreign investors began abandoning investment projects in Belarus as early as 2020, amid the unfolding political crisis. In 2021, their interest in the country remains low, which is partly due to the pressure of sanctions imposed by Western countries.

Thus, we can note a general decline in investment activity in the Belarusian economy amid the global economic crisis, as well as domestic uncertainty.

Govt downgrades inflation forecast for 2021

Inflation acceleration observed in late 2020, due to the weakening of the Belarusian ruble, as well as increased inflation expectations of economic agents, have moved into 2021. Early this year inflation continued to accelerate under the influence of further increases in global food prices, as well as the prices of imported non-food products. The authorities themselves provided an additional pro-inflationary impact in the domestic market by cancelling a number of VAT exemptions.

According to Belstat, by the end of March consolidated inflation made 8.5% in annual terms against 8.7% a month before. The prolonged and significant deviation of inflation from the original forecast for 2021 (no more than 5% year-on-year in December) forced the National Bank to revise its inflation forecast and raise the refinancing rate. The regulator last raised the key rate in 2015.

According to the National Bank, taking into account the impact of various factors, the increase in consumer prices in December 2021 is estimated to be “close to” 7% year-on-year. "Going forward, annual inflation will continue to slow down and from the second quarter of 2022 is estimated at a medium-term target of close to 5 per cent,” the National Bank said in a statement after its monetary policy board meeting on April 14, 2021.

Among the likely factors that will have a negative impact on inflation in Belarus in the near future, the regulator mentions the increased inflationary background in the global economy, as well as in the countries, which are major trading partners of Belarus. At the same time, the impact of food prices shocks as well as the pandemic consequences in terms of rising costs of imported non-food items may be more significant in Belarus, the National Bank said.

The National Bank has estimated that weak consumer and investment demand within the country will act as deterrents to inflation in the near future.

Meanwhile, according to Belstat, consumer prices in Belarus rose by 0.7% month on month in March 2021 after a 1.9% increase in February. Food prices rose by 0.4% month on month (+7.8% year on year), non-food products - by 1.4% (+9.5% yoy). Services tariffs increased by 0.3% (+8.2% yoy).

The annual core inflation in Belarus moderately slowed down to 8.2% in March 2021 against 8.3% a month earlier. Trend inflation in March was 6.7% vs. 6.5% in February. Regulated prices and tariffs rose by 8.7% year on year compared to 8.5% in February. According to MART, in March the prices of spirits and tobacco products were increased compared to February (by 0.5% and 0.7% on average, respectively), medicines (1.8%) and motor fuel (2.3% on average).

The growth of seasonal prices (prices of fruit and vegetable products) slowed down to 12.8% against 15.9% a month before. Accordingly, the contribution of these indicators to the overall inflation rate changed.

In 2021, the authorities introduced and officially set a consumer price target for socially important commodities (essential goods). According to the government's forecasts, the indicator should not exceed 4.9% at the end of the year. However, in the first quarter of 2021, consumer prices for socially important goods increased by 3.4%, while the forecast for that period was not more than 2.5%.

Thus, inflation risks remain elevated in Belarus due to both external and internal factors. In this context, it is worth mentioning the existing high inflation expectations in the economy, fuelled by the statements and actions of the authorities in restraining price increases.

Economic recovery depends on overcoming political crisis

Economic growth in Belarus this year has been supported by administrative methods (including by means of artificially discharging warehouses in manufacturing industry and directed lending), as well as at the expense of last year’s low comparative base.

However, administrative methods do not address the previously accumulated imbalances, nor do they help to resolve the political crisis in which the country has been dwelling after the 2020 presidential election.

The post-election sanctions imposed by Western countries have already effectively blocked foreign investment in Belarus.

Belarusian businesses face barriers and increased risks to further development. The findings of a survey conducted by Satio, with executives of private and state-owned companies interviewed, indicate that economic actors expect the country's economy to recover no earlier than 2024 if the political crisis continues, if it is overcome soon - in 2022.

Economic actors understand that their operating environment can be substantially altered at any time based on the political priorities of the authorities, which holds back investment activity and economic growth in general.

PrimePress Business Analysis Agency

2021-04-30

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