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Belarus: public sector development
Dmitry Kolkin
Advisor
to the Minister of Economy
Belarus 2010: key figures
“… Belarus achieved an average 7.5 percent annual growth in the ten years
up to 2008, benefiting from its inherent strengths and favorable external
conditions. High investment-to-GDP ratios and productivity gains from a
well-educated and disciplined labor force were the main contributors to
growth…..”
IMF
Area: 207,600 km2 (ranked 85th in the World)
Population: 9,648,533 (ranked 88th in the World)
Capital: Minsk (1.84 million people);
Population density: 49 per sq. km;
Labour force: 4,5 million
Unemployment rate: less than 1% (ranked 5th in
the World)
Literacy: 99,6%
GDP (PPP) per capita: $13,909 (ranked 88th in the
World)
GDP growth: + 7,6% (ranked 25th in the World)
Source: National Statistics Committee, World Bank
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Belarus 2010: key figures
GDP structure, %
Source: National Statistics Committee
Industry structure, %
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Belarus: public sector
Fixed Assets Structure, 2010
100
90
80
70
60
50
40
30
20
10
0
80
41
- 70% of enterprises has state share in
authorized funds
59
- almost 60% of fixed assets belongs to
state
89
20
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Russian Federation
Kazakhstan
state property
Belarus
private and mixed property
Employment Structure, 2010
100
90
80
70
60
50
40
30
20
10
0
69
52
77
48
31
23
Russian Federation
Kazakhstan
state property
Source: Ministry of economy
- every second employee is employed on
public enterprises
Belarus
private and mixed property
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Belarus: public sector
The size of state sector is the
largest among CIS countries
and Eastern Partnership
countries and it accounts for
almost 70% of GDP
Private sector share in GDP, %
85
75
65
55
45
35
25
15
2004
2005
2006
Armenia
Kazakhstan
Russian Federation
Source: EBRD
2007
Azerbaijan
Georgia
Ukraine
2008
2009
2010
Belarus
Moldova
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Belarus: transition Indicators
Transition Indicators: large scale privatization
Till 2008 there weren’t any
intention to use privatization as
instrument of enterprise
development.
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4
2
ARMENIA
AZERBAIJAN
BELARUS
GEORGIA
KAZAKHSTAN
MOLDOVA
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
1996
1995
1994
1993
1992
1991
1990
1989
0
Transition Indicators: small scale privatization
6
4
2
ARMENIA
BELARUS
KAZAKHSTAN
Source: EBRD
AZERBAIJAN
GEORGIA
MOLDOVA
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
1996
1995
1994
1993
1992
1991
1990
1989
0
But since 2008 creation of 3Y
privatization plans has been started,
that helped privatization processes
to be more consistent and
transparent.
Meanwhile small scale
privatization is still considered as
unused instrument of private sector
growth.
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Belarus: transition Indicators
Transition Indicators: enterprise restructuring
From 1996 till 2008 there weren’t
any changes in enterprise
restructuring indicator, but in 2008
some significant steps was made.
2.5
2.0
1.5
1.0
0.5
ARMENIA
GEORGIA
RUSSIAN FEDERATION
AZERBAIJAN
KAZAKHSTAN
UKRAINE
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
1996
1995
1994
1993
1992
1991
1990
1989
0.0
BELARUS
MOLDOVA
Transition Indicators: price liberalization
5.0
4.0
3.0
2.0
From 2008 Belarus has been doing
consistent steps in price
liberalization: price and trade
restrictions on many goods were
removed and reduction
of list of minimum export prices
was made.
1.0
ARMENIA
GEORGIA
RUSSIAN FEDERATION
Source: EBRD
AZERBAIJAN
KAZAKHSTAN
UKRAINE
BELARUS
MOLDOVA
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
1996
1995
1994
1993
1992
1991
1990
1989
0.0
Since beginning of 2011 the
government has regulated prices
only on 27 products.
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Public sector: macroeconomic indicators
Average GDP growth rate (1989-2010), %
5
4
Although major economic indicators
has been remained at optimistic level
we expect them to be less attractive
during possible restructuring of
state owned enterprises.
4.3
3
3.1
2
3.1
2.2
1
2.2
0.5
0
-1.4
-1.5
Georgia
Ukraine
-1
-2
Azerbaijan
Belarus
Armenia
Moldova Kazakhstan
Russian
Federation
Annual income from privatization, millon
USD
Average unemployment rate (1989-2010), %
10
9
8
7
6
5
4
3
2
1
0
1,400.0
8.6
8.5
1,200.0
8.5
7.7
7.5
1,000.0
800.0
600.0
4.9
400.0
2.7
200.0
1.7
Belarus
Source: EBRD
0.0
Georgia
Russian
Federation
Armenia
Azerbaijan Moldova
Ukraine
Kazakhstan
2006
2007
2008
2009
2010
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Public sector: macroeconomic indicators
Average annual consumer price index growth
(1989-2010), %
1,200
1,000
952.5
is # 3 in the world in terms of exporting
of potash fertilizers,
800
600
394.6
400
344.6
275.2
268.1
205.8
200
151.5
15.5
0
Georgia
15,000
Belarus:
Armenia
Ukraine
Belarus Kazakhstan Azerbaijan Russian Moldova
Federation
FDI net inflow, million USD
10,000
occupies 7% of the world tractors
market,
occupies 30% of the world market of
heavy-duty dump truck,
5,000
0
occupies 3% of the world cheese
market.
-5,000
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Belarus
Moldova
Source: EBRD
Georgia
Ukraine
Armenia
Kazakhstan
Azerbaijan
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Conclusions:
 Belarus has achieved high economic growth during past 15 years,
 Economic model of the country in managing of state owned enterprises
needs to be restructured for better performance,
 With the help of privatization and FDI attraction we consider this
restructuring to be run more efficiently,
 PPP is one of the main factor of increasing corporate management in
public enterprises,
 Private sector input in GDP should be increased to the level that would
allow Belarus to promote another economic growth driver…
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Thank you and
Welcome to Belarus!
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