Projected GDP growth rate is unattainable without oil re-export schemes
By the year-end, GDP growth rate will hardly surpass 2%. Projected GDP growth rate for 2013, 8.5%, is not feasible if there are no new major commodity export schemes.
Statistics Ministry released data on Belarus’ socio-economic development in January-November 2012.
During the first six months, GDP growth rate in Belarus was 2.9%. In January – November the growth rate dropped to 2%. The main reasons – suspended solvents and lubricants exports and reduced biodiesel supply, which negatively affected the chemical industry, oil refining and wholesale performance.
Approved GDP growth forecast for 2013 is 8.5%. The forecast is planned to be achieved via innovation economic policy and export growth. It is envisaged, that in each Belarusian regional center 10 new businesses will be set up. The situation with the wood-works modernization demonstrated the inability to set up new facilities in quantities that would significantly affect GDP growth in such a short period of time. Spheres, where significant export growth will be feasible, have not been named, and projected export growth rates have been set too high.
A significant challenge for GDP growth in 2013 is a high comparative base in 2012. In 2012 refining was loaded to its full capacity, which cannot be significantly improved due to uncompleted modernization. Schemes, used to export solvents and lubricants were important, but their resumption on a similar scale is unenforceable. Schemes’ foreign currency proceeds were substantial, contributing to GDP growth. The remaining Belarusian exports are already using maximum of their potential and there is nothing as significant to replace the solvents and lubricants export schemes.
Thus, to meet the high growth rates, Belarus needs new schemes, similar to the petroleum products re-export carried out in 2012. Otherwise, GDP growth will be limited to the 2012 values.
The Labour and the Tax Ministries are considering the possibility to include persons engaged in some economic activity without forming a legal entity in the social security system. When the decree No 337 comes into effect, the number of private entrepreneurs is likely to reduce due to the possibility of reducing the tax burden when switching to a tax payment as an individual. 95% of self-employed, including PE, pay insurance premiums on the basis of the minimum wage. The number of self-employed citizens is expected to increase, the number of insurance contributions to the pension system from PE will decrease, the number of citizens who will pay a fee to finance government spending will decrease by several tens. Self-employed citizens have the alternative not to pay social security fees and save resources for future pensions, which, given the gradual restriction by the state of pension requirements could be a more long-sighted option.