Republic of Belarus: national economy

The Republic of Belarus in 1991 declared independence on September 19. Since that moment, multiple transformations have been introduced. It was at this time that reforms began. However, the products produced by the country, unfortunately, were of low competitiveness and did not meet European standards. Belarus (the economy at that time was just beginning to emerge) took advantage of relations with Western countries, which allowed to establish flows of export raw materials and imported equipment.

On the markets of the CIS countries, the products of the republic, on the contrary, were very competitive. Here the country successfully imports raw materials and exports products with high added value.

After the collapse of the Soviet Union, Belarus, whose economy suffered from a lack of investment, actively began to introduce a policy of import substitution and transfer the production of components to its territory.

Economy of Belarus at the beginning of the XXI century

When applying international standards to Belarusian organizations, a significant part does not stand, especially in comparison with the enterprises of developed countries. While Russian resources were relatively cheap, the economy of the republic coped, demonstrating high rates of development. However, this is not a certificate of the quality of the products produced in the territory of the Republic of Belarus. The economy of the country only suffered, as local enterprises gradually lost their positions in all commodity markets.

The situation began to deteriorate since 2006, together with an increase in prices for Russian raw materials. In 2011, this figure exceeded the record mark, which hardly completely destroyed the country's economy. This led to almost threefold devaluation of the Belarusian ruble.

In 2012, external relations with European states are extremely favorable. However, this was not enough, the economy demonstrated the lowest GDP growth rate in recent years - 1.5%.

The reasons for creating a customs union

The lack of prospects for economic development pushed Belarus to forcibly create a customs union with Russia and Kazakhstan. In order to stay afloat in the developing world, the country needed economic reforms. The first and most important of them is the need to modernize enterprises, making them more efficient and economical.

The significance of such a restructuring could not be underestimated by Alexander Lukashenko, the President of the Republic of Belarus. The economy of the country was still inefficient and not competitive enough, therefore, it was out of the question to speak independently on the European market without the support of strong partners. This was the main reason why the state prefers political and economic integration with Russia and Kazakhstan. Such a regional union, provided certain conditions were met, could become the initial stage in the introduction of Belarus into the world economy.

Conclusion of the customs union

The first agreement on the customs union between Belarus and Russia was concluded in 1995. Due to the discrepancy of economic interests over the past 15 years, these countries have done virtually nothing to effectively advance along the planned path. And only by 2010, when joining the Kazakhstani process, the Customs Union acquired some real features, especially after the signing of the agreement on the formation of the Single Economic Space.

Main branches of Belarusian economy

At present, the following industries are well developed in the state:

• The food industry - for 2014 is more than 25%;
• The fuel and energy complex specializes in the production of coke, nuclear materials and petroleum products, occupies almost 20%;
• Chemical production (about 10%);
• Machine building (slightly less than 9%);
• Metallurgy (7%).

Trade relationship

The economy of Belarus is now at a fairly good level. In modern conditions, it is trying to actively build mutually beneficial relations with all countries of the world, considering it the main guarantee of the success of the entire state as a whole. The main component of the economy is trade. Therefore, when studying the development of the state, this issue should be given special attention.

The main trade partners of the Republic of Belarus are:

• Russia ($ 37.6 billion);
• Ukraine (6.2 billion dollars);
• Germany ($ 4.1 billion);
• Great Britain (3.2 billion dollars);
• China ($ 3 billion);
• Poland (2.3 billion dollars).

The data are taken from BelStat (the official site of the Register of Information Resources of Belarus).

The most positive balance is in trade with the Netherlands. And the most negative - with Russia, which means a very large import of goods.

The main export item of the Republic of Belarus is potash fertilizers, oil products and machinery. And imports - energy resources and equipment.

The pharmaceutical industry and biotechnology are currently considered the most demanded industries where foreign investments are invested.

The economy of Belarus uses a multi-vector approach. That is, the state establishes trade and economic relations with the countries of the West, the CIS and the third world in equal measure.

US and EU

With the states of the West (the US and the EU), the country faces certain difficulties, in particular, because of sanctions, high consumer competition in this market and because of strict norms and standards.

CIS

On the CIS market, Belarusian goods are very competitive and in great demand. However, the turnover in recent years is decreasing. It should also be noted that in 2015 Belarus, together with Russia, Kazakhstan and Armenia joined the Eurasian Economic Union, which opens new opportunities for trade, movement of capital and labor. For the time being, these relations do not function fully due to the global crisis, but Belarus will soon be able to get some benefit from this agreement.

Third World countries: trade and economic relations

The third world countries are a completely new market for the Republic of Belarus. Its economy from these relationships is rapidly increasing its level. Local goods here are successfully sold, as there is practically no competition.

However, there are certain problems with logistics (more precisely, with its cost) because of the long distance. But political analysts believe that this market is quite beneficial for the state, since it is not always possible to work smoothly with Western countries. That is why China, India, Brazil, Venezuela, Pakistan, the United Arab Emirates and others became the main partners of Belarus.