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Opinions & Interviews

28 Apr 2018

Belarus’ GDP growth strong in Q1 2018, outpaces forecast

Belarus’ GDP growth strong in Q1 2018, outpaces forecast

MINSK, 28 April (BelTA) – The Belarusian economy expanded in the first quarter of 2018 but there is no room for complacency, Belarusian Prime Minister Andrei Kobyakov said at the meeting of the Council of Ministers to discuss the country's social and economic performance in the first quarter, BelTA has learned.

“All in all, we were off to a good start in 2018. However, there is no room for complacency. The economy still has bottlenecks that require operational and systemic measures. Basic approaches to their solution are known. The challenge is to keep the positive growth trend in place,”Andrei Kobyakov said.

In January-March six key indicators of the performance of the government and the National Bank were achieved. With regard to the seventh indicator (foreign direct investment on a net basis) the statistics will be available by the middle of May, but there are all reasons to believe that it will be executed.

According to the prime minister, a good basis in terms of GDP growth was laid early this year. The GDP expanded by 5.1% as against the forecast of 2.1% and for the first quarter and 3.5% for the year). Productivity is increasing even more rapidly than GDP. Growth of the gross regional product and productivity was registered in all regions.

Thanks to the favorable external economic situation, exports of goods and services increased by nearly 30% in January-February 2018 from the same period a year prior to total $6.2 billion. “Our foreign trade is well-balanced. The trade surplus in January-February was $206 million. In January-February 2017, it made up just $66 million,” Andrei Kobyakov added.

There is no point in relying only on favorable external factors, he stressed. “The promotion of Belarusian products should be more effective. We do not take advantage of today’s situation. Tomorrow our potential market niches can be occupied by others,” he underlined.

The sales margin stood at the level of January-February 2017 (7.3%) given that the amortization expenses grew in early 2018. The sales margin in the industry inched up by 0.1% to make up 8%.

The number of loss-making companies went down by 42, or 2.5% year-on-year.

The investment activity remains robust: capital investments in Q1 2018 rose by 21.8%. The expenses on the purchase of equipment grew faster than the expenses on construction and installation works (51.5% and 10.5%, respectively). The construction sector has been expanding for three consecutive months following a decline in the previous periods (the gross value added increased by 9.5% in Q1 2018).

“I would like the architecture and construction minister to report on the state of affairs in the sector. What results can we expect from the sector in the future? The sector is lagging behind in the export of services. What has been done so far to reverse the tendency?” Andrei Kobyakov asked.

The Belarusian PM also spoke about the situation in the industrial sector that remains the country’s main economic indicator. In Q1 2018, the growth was secured in 12 out of 13 sections of the processing industry. The industrial production objectives were achieved by almost every government body, except for the Agriculture and Food Ministry and Bellegprom Concern. The companies affiliated with the Industry Ministry posted the growth of 19.4%. The organizations of the Construction and Architecture Ministry grew by 10%, Bellesbumprom Concern by 21.7% and Belneftekhim Concern by 10.1%.

According to the head of government, the innovative component of the industrial growth remains insufficient for ensuring competitive ability. As for oil refining, the government expects good performance from the sector.

The current focus of the country’s agricultural sector is on the ongoing sowing campaign. The planting in Brest Oblast has been completed. The sowing in Vitebsk Oblast should be accelerated. “The agricultural sector performance has been examined in detail at the government session chaired by the head of state. Decisions have been made and must be fulfilled. This is the priority task for the governors,” Andrei Kobyakov said.

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