Economic recession in Belarus will be treated with changes in statistical methodology

Category status:
April 22, 2016 19:15

The National Statistical Committee has adopted a new methodology to measure non-observed economy. These changes were prompted by the need to have better understanding how non-observed economy affected the overall economic performance in Belarus. As a result, GDP is unlikely to start growing, however some statistical indices may improve. 

The new regulation regarding non-observed economy measurements will take effect in late June 2015. The core changes in the methodology imply inclusion of a greater number of activities when calculating GDP. In particular, the volume of housing services for personal consumption has been increased. If a company does not provide statistical reports, then it will be assumed that its workers produce equal volume of products with those companies, which engage in similar activity and report to the Statistics Committee. Private entrepreneurs will report like small enterprises with up to five people. Tutoring services will be measured based on number of those admitted to full-time studies at universities. 

Such changes have been introduced in order to have better understanding how non-observed economy affects the overall economic performance in the country. Errors and omissions in the Belarusian balance of payments previously often were explained by the exclusion of non-observed economy from statistical measurements. Several state agencies will be in charge of implementing the new regulation. 

In Q1 2015, the Belarusian economy fell by 2.6% without any prospects for improvement. Industry was the main culprit of falling GDP. Meanwhile, amid crisis and mass layoffs, non-observed economy has grown. Non-observed economy’s production output would be difficult to compare with the production output at larger enterprises and in most cases would be significantly lower. Expert evaluation, which will be used in the updated methodology would be difficult to verify, which might lead to overreporting. Some entrepreneurs will cease operations, but will be included in GDP measurements. 

Overall, the Belarusian Statistical Committee has acknowledged problems with traditional economy reporting. It seeks to improve reporting by including non-observed economy indicators. Eventually, these new adjustments in the methodology are unlikely to show significant impact of non-observed economy on the economy in general, however, they might demonstrate economic growth by about 1% before the presidential elections in October 2015.

Similar articles

Belarusian authorities step up pressure on opposition before street protests
October 02, 2017 12:20
Image: "Новы Час"

During searches of social and "green" activists and anarchists, law enforcement has seized computers, mobile phones and publications. The authorities have also exerted additional pressure on supporters of unauthorized street protests and independent lawyers, who represented defendants in the White Legion case. The security services have stepped up the persecution of opponents before the street protests announced by the opposition. Apparently, the Belarusian authorities aspire that participants in street protests would reduce in number and that the low interest of the population to socio-political agenda before the local election campaign would retain.