Central counterparties in securities trading: Preconditions, costs, and potential benefits for Belarus (Russian version)(more…)
Central counterparties in securities trading: Preconditions, costs, and potential benefits for Belarus (English version)(more…)
Economic growth continues to slow down
Economic growth slowed down significantly due to external factors and amounted to only 1.2% in 2019. High uncertainty about future supply conditions for Russian crude oil and gas, as well as ongoing structural problems, further dampen future growth prospects: the forecasts for 2020 (0.9%) and 2021 (0.5%) remain at a similarly low level.(more…)
- Investment study: Identification of 35 proposals by German businesses to improve investment climate in Belarus
- New initiatives to support SMEs: New approaches for financial SMEs support are being discussed as part of a new reform agenda. Focusing growth-oriented SMEs appears to be reasonable.
- Agricultural exports: Exports of products of animal origin are heavily concentrated on the Russian market. Diversification encouraged, especially dairy products have potential.
Designing SME support programs: International experience and implications for Belarus
To date, SME support in Belarus has mainly consisted of concessional loans. The Belarusian government now wants to put SME supporton a broader footing and, above all, to include non-financial support instruments such as training and advisory services in its range of support offers.
Since the reorganization of SME support is beginning from scratch, Belarus has the opportunity to take account of international experienceand lessons learned.(more…)
Sovereign debt markets and local market makers – best practice in emerging capital markets(more…)
Export potential of Belarus’s agro-food sector on the markets of Europe, Asia and Africa (Part 2)(more…)
Export potential of Belarus’s agro-food sector on the markets of Europe, Asia and Africa (Part 1)(more…)
Developing a sustainable credit guarantee fund in Belarus(more…)
Improving the Business Climate – Boosting Private Investment(more…)
Financial Sector Monitor Belarus 2019(more…)
The Hypothetical Monopolist Test: A concept for market definition(more…)
Building a venture capital sector in Belarus: State participation, tax incentives and accelerators(more…)
Industry 4.0 – Overview and Policy Implications(more…)
The concept of entrepreneurship in the regulative frameworks of Germany and Belarus
Belarus has recently adopted some reforms that simplify and liberalize the registration of a number of economic activities.
We compare and assess the recent reforms with the concept of entrepreneurship in the German law with a special focus on
- Permission and registration requirements and
- The legal status of natural persons, who carry out economic activities.
Improving the Funding of Export Transactions
Export Promotion is a proven and valuable instrument for strengthening a Nation’s export performance. Through export promotion national companies gain experience in tackling international markets, they can improve their international competitiveness, attract export finance and get protection against the risk of non-payment of foreign contract partners. However, the design of an export promotion scheme needs to be done with caution, because many domestic and international aspects must be taken into consideration. For Belarus, not (yet) being a WTO member, the WTO Agreement on Subsidies and Countervailing Measures (ASCM) nevertheless should be an important benchmark concerning the ultimate borderline for state supported export finance and export credit insurance. Not only internationally, but also domestically aspects of protection of competition and avoidance of corruption and unfair business practices need to be considered.(more…)
Belarus-Russia: Is bilateral integration happening?
Since December 2018, Belarus and Russia have been in talks over the prospects of deepening their bilateral integration. The negotiations have taken place behind closed doors and provoked all sorts of rumours and fears in Belarus and the West. While difficult talks continue, the authorities in Minsk stress that national sovereignty is an absolute value and a “red line”.(more…)
Improving the business climate – Proposals from business
After the recession in 2015/2016, the Belarusian economy is back on a growth path. Nevertheless, more growth and investment of the private sector is required if Belarus is to catch up with the advanced economies. A joint study of GET Belarus together with three German business associations presents 35 proposals from German businesses on how to improve the business climate and unlock more private investment in Belarus.(more…)
External factors dampen economic growth
Due to external factors, the economic development is once again losing momentum. The forecast for 2019 has been revised downwards once again and now stands at only 1.8%. One of the main reasons for this is the pollution of the “Druzhba” oil pipeline, which has a negative impact on the production and export of oil products. The growth forecast for 2020 remains even weaker at 1.3%.(more…)
Banking sector weighed down by legacy of state-led lending
Belarus’ banking sector continues its recovery from the 2015-16 recession. Overall credit has again been growing since late 2017, with credit allocation shifting towards households and private enterprises. As the exchange rate stabilized and inflation has come down, local currency interest rates have markedly declined, encouraging a shift of deposits and lending into local currency. At the same time, it is still not clear that the sector is equipped to support further growth in the economy, and the long-overdue structural change towards private enterprises. In this regard, the legacy of delinquent loans of state-owned enterprises still needs to be resolved, and will require broader governance reform in the corporate sector. In this transition capital markets could become a more important source of funds.(more…)
Belarus-Russia: where are current tensions leading?
Like many times before, Belarus and Russia are disputing the terms of their special relationship. However, geopolitics and Russia’s oil tax manoeuvre have made current tensions more serious by aggravating fundamental contradictions between the allies. Belarusian- Russian relations await bumpy times ahead, with their future depending on whether Minsk and
Moscow will manage to find a mutually beneficial alliance model in the new geopolitical reality.
Economic recovery continues, but loses steam
The Belarusian economy continued to recover in 2018 (3.0%), with 2.4% growth forecast for 2019. The recovery, however, is cyclical in nature and already beyond its peak. Without any further economic reforms, medium- term growth is likely to remain capped at around 2.0% per annum.(more…)
Improving the Business Climate – Boosting Private Investment
Proposals from German business in Belarus(more…)
A regulatory framework for venture capital funds in Belarus(more…)
Diversification of Belarusian Exports: The Potential of the DCFTA-Countries Ukraine, Moldova and Georgia
Belarus is an open economy, with exports running at above 50% of GDP. The Russian Federation accounts for about half of Belarus’ total exports of goods. A diversification of Belarus’ exports to other markets would be a well-founded policy goal, increasing export sales and reducing the vulnerability to external shocks.(more…)
Diversification of Belarusian Exports: The Potential of Machinery Exports on Non-Traditional Markets
Belarus is an open economy, with exports exceeding 50% of GDP. Within the basket of export goods, machinery and equipment exports play an important role. In 2017, they amounted to USD 5.3 bn, which implies a share of 18% in total goods exports. Vehicles are the largest category of Belarus machinery exports, accounting for 43% of total. This includes vehicles for the transportation of goods, tractors and motor cars. However, the geographical structure of machinery exports is – in line with the overall export structure – highly concentrated. Belarus’ traditional export destinations are the Eurasian Economic Union EAEU (including the Russian Federation), the CIS (outside the EAEU) and to some extent the EU. Taken together, these markets absorb a whopping 93% of Belarusian machinery exports.(more…)
Strategic Options to Improve the Effectiveness of Investment Promotion Agencies (IPAs)
Not only competition between locations, but also between IPAs has significantly increased in the recent past. Taking into account international best practice, this policy study assesses strategic options to increase the effectiveness of IPAs in a competitive landscape.(more…)
International linkages and external shocks: A Global VAR perspective for Belarus. Evidence from different model specifications
Belarus as a small, open economy is closely integrated into the global economy via complex commodity, trade and financial channels. The empirical investigation of the impact of different external shocks, e.g. changes in the global price of crude oil, or a recession in Belarus’ main trading partners on its main macroeconomic variables like GDP, inflation and the exchange rate is of concern to policymakers and researchers alike.
In this policy study, we use a very modern and sophisticated econometric approach to investigate these issues further. The Global Vector Autoregression (GVAR) as a multi-country model has been specifically developed to study such global macroeconomic issues, and has to our knowledge not previously been applied to the case of Belarus.(more…)
Policy Options to Reform Free Economic Zones in Belarus
In Belarus, six Free Economic Zones (FEZs) exist in the country, with the first one (Brest) coming into existence 20 years ago. Their main objectives are according to the Law the promotion of the socio-economic development of Belarus and its regions, the attraction of investments aimed at the creation and development of export-oriented and import-substituting industries based on new and high technologies, as well as other purposes.
A more detailed assessment of their economic performance reveals a very mixed picture, though. While their contribution to the nations FDI and employment stock is relatively limited (5% and 3%, respectively), there have been worrying growth dynamics over the last years. The number of zone residents as well as the people employed in FEZ shrank over the last couple of years. The export share in FEZ is rather poor in international comparison, and they did not really contribute to the diversification of exports from traditional CIS markets towards new markets.(more…)
Money as a leading indicator of inflation in Belarus and its implications for monetary policy
High inflation is one of the most acute problems of the Belarusian economy in recent years. It undermines the foundations of macroeconomic stability, introduces a significant uncertainty in the activity of enterprises and households, and creates difficulties for private business development. Therefore, at the moment the reduction of inflation is a key issue for economic policy in Belarus. In order to stabilize high inflation and make monetary policy more effective, the National Bank of Belarus (NBB) in 2015 moved to a regime of monetary targeting. However, the usage of monetary targeting requires clear-cut and stable relationships between the variables used as the operational, intermediate and final target. The absence or weakness of such links makes a monetary targeting regime actually ineffective in reducing inflation.(more…)