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REPUBLIC OF BELARUS

REPUBLIC OF BELARUS

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REPUBLIC OF BELARUS

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  1. REPUBLIC OFBELARUS

  2. OUTLINE: • Background • Economic development since 1991 • Preconditions and impact of world financial crisis in 2008 • Devaluation of currency in 2009 • Conclusion

  3. BACKGROUND • Total area 207,600 sq km • Population 9,648,533 (2009) • GDP-real growth rate 8.1% (2008) • GDP per capita $12,000 (2008) • Labor force 4.3 million (2005) • Official unemployment rate 1.6% (2005) • Inflation rate (consumer prices) 15.5 % (2008) • CA balance -$3.832 billion (2008)

  4. Since independence 1991: Source: Country Economic Memorandum for the Republic of Belarus, World Bank

  5. Average annual GDP growth, % Source: World Bank ECA Regional Database

  6. Average annual inflation, % Source: World Bank ECA Regional Database

  7. Structure of export of production from the Republic of Belarus in 2007, in cost expression Source: IRUE "National center of marketing and price study"

  8. GLOBAL FINANCIAL CRISIS, 2008Preconditions: • High degree of government interventions • Underdeveloped stock market • High dependence on trade with Russia • Slow pace of geographic export diversification

  9. GLOBAL FINANCIAL CRISISImpact: • State dominated economy, limited contact with world financial markets, less dependent on international credit not severe effect of financial crisis • Sharp decline in Russian economic subsidies and sharp decline in exports and imports to Russia due to financial crisis affected Belarusian economy

  10. IMPORTS AND EXPORTS OF GOODS, RUSSIA

  11. JANUARY 2009 CURRENCY DEVALUATION • immediate 20 % devaluation in the BYB, implemented on January 2, 2009 • $2.5bn (£1.7bn, €1.8bn) IMF emergency loan, $1 bn credit from Russia, $ 500 mln from Venezuela • the central bank raised interest rates from 12 to 14% • possible devaluation in the future by 25 %

  12. BELARUSIAN RURLE OFFICIAL AVERAGE EXCHANGE RATE AGAINST FOREIGN CURRENCY Source: National Bank of Belarus

  13. CONCLUSION • State-dominated economy • High dependence on single and unstable market – Russia • Impact of financial crisis • Need for economic reforms • Questionable effect of currency devaluation

  14. REFERENCES • CIA factbook • National Bank of Belarus • IMF • IPM Research Center • Financial Times, UK • Deutsche Welle • Narodnaya Volya, Belarusian news

  15. THANK YOU!