Economic Monitor

In German

Last year, the Uzbek economy grew by a strong 6.0%, driven by rising government spending and investment. Solid growth of 5.4% is expected for the current year. The inflation rate in August 2024 was a relatively high 10.5%, which was driven by the increase in energy tariffs for households. The budget deficit and current account deficit were also elevated at 5.5% of GDP and 8.6% of GDP respectively in 2023, but are expected to decline this year.

-In German-

The Belarusian economy grew by 3.9% last year, driven mainly by investment and consumption growth. However, the ICT sector slumped. Growth is expected to slow this year and next. Sanctions continue to weigh on the economy, with trade activity focused almost exclusively on Russia. High inflation has been contained through price controls and exchange rate stabilisation.

Kosovo’s economy grew by 3.3% in 2023, driven by public spending and private consumption, and is expected to stabilize at around 4% in coming years. Inflation, which peaked at 11.6% in 2022, declined to 5% in 2023 and is expected to continue declining in 2024. Despite increased imports due to strong public spending and high FDI-inflows, the current account deficit narrowed to 7.9% of GDP. The budget deficit remained unchanged at 0.8% of GDP in 2023, despite increased public spending.

Last year, the Armenian economy grew by an impressive 8.7% in real terms, largely due to the influx of Russian emigrants. Forecasts for the current year range between 5 and 6.1%, although the integration of refugees from Nagorno-Karabakh could again be a growth factor. Inflation, which had been well above the central bank’s target in previous years, fell to just -0.6% last year. This slightly deflationary trend, caused in part by tight monetary policy, is not expected to continue this year or next. The dram will remain stable against the US dollar, while a higher budget deficit and a sharp rise in goods imports and exports are also expected in 2023.

After a sharp decline in GDP in 2022, the economy experiences moderate growth of 5.2% in 2023 and 4% in 2024, mainly driven by rising consumption. Despite a current account deficit and growing trade deficits, foreign exchange reserves improve (2023: USD 40.5bn) and inflation falls to 5.1%. Nevertheless, massive budget deficits and rising public debt remain, making debt restructuring necessary, as well as a dependence on foreign financing. The new Black Sea corridor offers opportunities for exports, while regional disparities and labour market challenges due to migration require special attention.

The Moldovan economy is showing signs of recovery following the recession in 2022. Economic growth of 2.0% is forecasted for 2023, driven by the agricultural sector. In 2024, growth could increase to 3.9%, due to rising private consumption.
Despite a fall in the inflation rate to 4.2% by the end of 2023 and a lower budget deficit, challenges remain due to currency appreciation and a lack of growth stimulus.
Trade with Ukraine has declined, while exports of services have increased. Trade relations with the EU, which focus on plums and pork, and a possible switch from USD to EUR as the reference currency could offer new economic opportunities.