Belarus Country Risk Report Q3 2018
The Belarusian economy will continue to recover following two years of recession, primarily as robust domestic demand and recovering energy prices drive growth.
Robust private consumption will be a significant driver of growth over the coming years.
Recovering energy prices will provide a significant boost to gross fixed capital formation. We have made a significant upwards revision to our 2018 and 2019 price forecast for Brent crude oil.
Our Oil & Gas team has revised up our price forecast for Brent to USD73.0/bbl and USD77.0/bbl for 2018 and 2019 respectively, in response to stronger-than-anticipated price gains in the year to date.
That said, following relatively solid growth in 2018, we expect eco-nomic activity in Belarus to gradually slow from 2019 onwards. This primarily reflects an overreliance on the Russian economy and a lack of progress on structural reforms.
A lack of structural reforms and weak productivity growth will drag on growth potential. Specifically, the significant footprint that the Belarusian government retains in the economy – primarily through state-owned enterprises – is unlikely to be reduced, weighing on capital expenditure.
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