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Belarusian

Economy & Trade

 

 

HISTORICAL OUTLOOK

 

Historically, economy of the Republic of Belarus is oriented at external markets. Export accounts for over 60% in the gross domestic product. Over 90% of tractors, trucks, 70% of machine-tools, refrigerators, chemical fibre and yarn, integrated circuits and semiconductors, over 50% of TV sets and consumer goods are exported.

The major economic and trade partner of the Republic of Belarus is the Russian Federation. Russia accounts for more than half of the total foreign trade of the Republic of Belarus. In its turn, the Republic of Belarus is also one of the major trade partners of the Russian Federation and it is second only to Germany in the Russia’s foreign trade turnover. The European Union ranks second as the trade partner of Belarus. The EU accounts for nearly one third of the Belarusian export to non-CIS countries and more than half of import.

Seeking the integration into the world economic community and active participation in the international division of labour motivates interest of the Republic of Belarus in equal membership in such controlling mechanisms of the world economic system as the World Trade Organisation (WTO).

 

The Republic of Belarus started reforming the state-owned property in 1991 and this process is still underway. The trade, transportation, services, commodity goods, forestry, woodworking and food sectors’ industries have been most intensively nationalised and privatised. 5, 476 units have been reformed and alienated over the period from 1991 to 2001 in Belarus, of them 3,474 have been reorganised, thereby accounting for 18.4% of the total number of Belarusian enterprises. 1,418 reorganised enterprises have been incorporated (41% of all reorganised enterprises), 1,334 units have been sold at auctions or through bidding, 722 units have been bought out by leasing or work collectives. 394 units have been reformed in the industrial sector, 241 — in the construction sector, 1,108 — in the trade sector, 243 — in the public catering, 402 — in the household services sector, 595 — in the agribusiness sector and 489 units have been privatised or incorporated in other sectors of the national economy. The reorganised businesses employ about 800 thousand people accounting for 21% of all the employees in the country. The private sector employed 1,946 thousand people, or 45.2% of all employees in the national economy as of the beginning of 2004. The retail turnover of the private sector of economy, including the public catering, through all market outlets accounted for 78.9% in 2003 of the total retail turnover.

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National Centre for Marketing and Price Study

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Online Catalogue of Belarusian Goods, Services and Companies
at the National Centre for Marketing and Price Study

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GUIDEBOOK ON DOING BUSINESS IN BELARUS
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Internet resource on investment potential of Belarus

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Belarus Investment Projects

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Belarus Innovation Projects

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25.4 thousand small businesses operate in the country, of them in the trade and public catering — 46.6%, in the industry — 20.2%, in construction — 11.3%, in the transportation sector — 5.4% and in the agricultural sector — 1.1%. Small businesses accounted for 7.6% of the total output in the country. Small businesses employ 255.7 thousand persons. 189 thousand individual entrepreneurs were registered in Belarus as of January 2004. The small-business sector totally employs 445 thousand persons in the country (10 % of the economically active population). The share of the sector makes up 17.5% of the total allocations to the budget.

After gaining the sovereignty, the Republic of Belarus remained one of the most economically developed countries of the FSU. The 1992-1995 economic recession was followed by production growth and political stability The active national economic policy allowed for stabilization and some growth in specific sectors of the economy in 1995. 1996 became a turnaround year. After an absolute drop, the GDP started growing: in 1997-2003 the average annual growth rate amounted to 6.5% and it is showing an upward trend. Compared to the neighbouring countries (except Poland), the GDP reduced at a significantly lower rate during the transformation period. Currently, the GDP per capita, purchasing power parity and UN-calculated human development index are much more higher in Belarus that in other CIS countries. Belarus is a large exporter of trucks, tractors, TV sets, refrigerators, chemical yarn and fiber, potash fertilizers, textile and consumer goods. The policy of strengthening economic relations pursued by Belarus increases its role in the world division of labour throughout the post-soviet regime territory. The export turnover per capita exceeds the respective indicators of many CIS countries.

Belarus efficiently collaborates with leading international agencies, namely, the European Bank for Reconstruction and Development, World Bank, International Monetary Fund assisting in promoting foreign entrepreneurship in the country. 2,415 companies with foreign investment have been registered in Belarus as of 01.01.2002 (1,308 JVs and 1,107 foreign enterprises). They were established with involvement of 81 countries worldwide, predominantly with participation of partners from Germany, Poland, USA, Italy, and the Netherlands. Of 2,415 registered joint ventures and foreign enterprises 2,082 have been operable as of 01.01.2002, of this number 40% in the industry, including 21% in machine-building, 18% in the food and 20% in the wood-working industries. Over the recent years, such giants as Coca Cola, Le Grand, Man, Macdonald’s, Bayer, Siemens and Moulinex and others entered the Belarusian market. In 2003 Belarus economy (excluding banking sector) draw USD 1.3 billion of FDI.

Since December 1992, the Republic of Belarus has the status of the observer at the General Agreement on Tariffs and Trade (GATT) and since 1 January 1995 — at the World Trade Organization. Joining the WTO remains the priority target of the national foreign economic policy currently being pursued. This policy is consistently aimed at transforming the trade policy and harmonizing the tariff and nontariff foreign trade activity regulation of the Republic of Belarus with the WTO general principles and rules — openness of the economy, liberalization, observance of conditions stipulated by trade and economic agreements.

Foreign trade relations of Belarus are continuously expanding. It is noteworthy that Belarusian goods and services trading volume amounted to USD 21,469 million in 2003 and increased 1.9 times compared to the 1995 level. The exports increased by 92% and reached USD 9,964 million, import — by 92% amounting to USD 11,505 million. The CIS countries account for 63% and non-CIS countries — for 37% of the total turnover, including export — 55% and 35% and import — 70% and 30%, respectively. The country is involved in foreign trade transactions with 152 countries worldwide. Belarusian goods are supplied to the markets of 129 states, while products of 130 countries are imported. In 2003, the major trade partners of Belarus were Russia — 58% of the total foreign trade turnover, Germany — 5.8%, Ukraine — 3.3%, Latvia — 1.8%, Poland — 3.6%, Lithuania — 2.0%, the United Kingdom — 4.7%, Italy — 1.9%, USA — 1.2%, the Netherlands — 2.4% and China — 1.1%.

The distribution of major commodity flows in the foreign turnover of the Republic of Belarus throughout the continents was as follows in 2003: Europe — over 90%, Asia — 4.8%, Northern and Latin America — 3.6%, and Africa — 0.6%. Therefore, the Republic of Belarus has most extensive foreign trade relations on the European continent. Currently, the European Union ranks second important trade partner following Russian Federation. The EU countries account for nearly 18% of the total Belarusian turnover. It continues to increase due to specifically such countries as Germany, Great Britain, France, Sweden and others. In 2003 exports of goods to the United Kingdom accounted for 9,4%(938,3 mln. USD) of total exports of the Republic of Belarus (9964 mln. USD). Import of goods to Belarus from the UK in 2003 accounted for 79,3 mln. USD.