Belarus economy’s key growth drivers gone in Q3 – expert

<p> MINSK, Dec 21 - PrimePress. Belarus’ economy lost key growth drivers in Q3 2021, which could trigger a recession in 2022, BEROC expert Dmitry Kruk said during an online presentation of Belarus' economic overview on 21 December. </p> <p>   </p> <p> Kruk said that one of the key macro trends for the third quarter of 2021 is that growth is fading while all financial indicators are strengthening. </p> <p>   </p> <p> “The main leitmotif of the third quarter was that we saw a rather rare situation where real indicators of economic activity were heading downwards, i.e. growth was slowing down for most of these indicators. But as for the nominal indicators, which characterise financial stability, the macroeconomic equilibrium was unequivocally positive for the vast majority of trends,” the expert said. </p> <p>   </p> <p> In his words, the gross domestic product (GDP) figure presented by Belstat contains many signals from past periods, while the GDP growth rate cleared of seasonal factors shows the “instant speed” of the economy. According to the expert, the Belstat data show a slight slowdown in growth, but based on the current data we can talk about a rather strong slowdown in growth in the third quarter of 2021. </p> <p>   </p> <p> “Based on the preliminary data, there is no clear driver of growth in the third quarter on the demand and supply side... If we look at its components on the demand side, the current data points to a decline in the main components of domestic demand (fixed capital investment, household consumption) and to a decline in net external demand. The solution to this conundrum might be a rise in fixed investment or, I assume, some revisions to the data. But the issue here is not so much the data, but rather that a clear growth driver, like net external demand during the last demand period, has been lost. We see exactly the same situation on the supply side,” Kruk said. </p> <p>   </p> <p> He noted that only two industries on the supply side are the “donors” of growth - primarily the traditional “Information and Communication” and also trade. </p> <p>   </p> <p> “This trend in itself - the loss of key growth drivers - seems to me quite important because for future periods it is still difficult to identify any supply and demand side forces that will pull the economy upwards, as happened, for example, with external demand during the period that we dubbed the 'foreign trade miracle'. If these trends are viewed through the prism of the current level of GDP, this indicates that a trend reversal is imminent. From this perspective, based on a lot of other evidence, I see a recession scenario in 2022 as a very likely conclusion,” says Kruk. </p> <p>   </p> <p> As previously reported, Belarus’ GDP in January-November 2021 grew by 2.3% year on year to Br158.252 billion ($62.67 billion at the exchange rate of the National Bank of Belarus). </p> <p>   </p> <p> The government of Belarus approved a medium-term financial program of the national budget for 2021-2023 under Resolution #227 of April 20, 2012, according to which the Belarusian GDP growth is planned at the level of 1.8% in 2021, 2.9% in 2022 and 3.8% in 2023. End </p> <p>   </p>

2021-12-22

Primepress