Throughout 2024, Belarus' economy showed moderate growth, driven by increased domestic demand, rising population income, Russian investments, particularly in the defense industry, growing exports to Russia, and low prices for Russian oil and gas.
This was reported by the Ukrainian Foreign Intelligence Service.
However, the rise in income was tied to a labor shortage amid high levels of migration. Many companies were forced to raise wages to prevent their employees from leaving for foreign countries.
At the same time, inflation accelerated due to the devaluation of the Russian ruble against the US dollar and inflationary processes in Russia.
Currently, international economic organizations forecast a slowdown in Belarus' economy from 2.6% to 1.2% in 2025, with inflation expected to accelerate to a range of 6.4-6.6%.
The main challenges include low human capital potential, excessive state control, lack of diversification in foreign trade, limited access to advanced technologies, and high dependency on Russia.
There are also risks of disrupted logistics chains, a significant slowdown in Russia's economic growth, and new severe sanctions against Belarus in the event of increased repression by Lukashenko's regime or the country's direct involvement in the Russia-Ukraine war.
As a result, the main obstacle to the sustainable development of Belarus' economy, apart from Lukashenko's dictatorial regime, is its complete dependence on Russia. Any reduction in Russian investments and subsidies is bound to exacerbate the economic crisis in Belarus.
