Belarusian Ruble Is Looking For Adventures
- 7.05.2025, 14:11
Down the slippery slope of recession.
At the beginning of this year, the Russian economy, after more than two years of miracles, went down for the first time. However, the decline was symbolic, and so far it has only been for one quarter. So it is too early to talk about recession. But the economy of Belarus was growing in such a way that the government surprised itself. But the growth against the background of the Russian decline threatens Belarusian stability with various troubles. The economies of Belarus and Russia are too closely linked for the Belarusian authorities to afford their own unique path, writes planbmedia.io.
The Slippery Slope of Recession
Reifaisenbank analysts estimate that Russia's GDP fell 0.3 percent in the first quarter compared to the final quarter of last year. Although even at the end of last year, Russian economic growth was on the verge of stagnation and amounted to only 1.3 percent.
"The quarterly decline is recorded for the first time since the second quarter of 2022... As a result, there are more and more signals of the economy's transition to a soft landing," the review says.
Signals are in fact already so numerous that even the Russian authorities are unable to ignore them. Even if the Russian authorities wanted to. Because the civilian sector of the Russian economy has already slipped into recession. According to estimates by analysts close to the authorities, the civilian sector of the Russian economy has been falling by an average of 0.8 percent since the beginning of the year.
The production of civilian machinery, machine tools, construction materials, and even minerals, for which the Russian economy is so famous, has been falling. So the production of missiles and shells was no longer saving the day. The growth rate of Russian industry fell fivefold.
And then oil prices fell so much that the Russian budget deficit had to be tripled. Putin's spokesman Dmitri Peskov did say proudly that "Russia's national interests are above any oil prices." But the Russian economy might disagree. The USSR also had national interests, but with the fall in oil prices they had to be seriously adjusted.
Our own way
The Belarusian economy is another matter. The Belarusian authorities have long been not up to laws and economic laws are not an exception. Therefore, in the first quarter, the Belarusian economy grew above the forecasts, surprising even the Belarusian officials who have seen the sights.
"The start is not bad yet. By 0.4 (percentage points) ahead of the forecast schedule," said Deputy Economy Minister Andrei Kartun in a recent interview with the Belarusian TV.
And the Belarusian economy was growing while Belarusian exports were falling. And it was falling not only to Russia, where the decrease in demand was a natural consequence of the beginning economic recession. In the markets of the far arc, on the development of which the Belarusian authorities spent so much effort, Belarusian exports fell by almost 12%.
So the Belarusian economy was growing mainly inside itself. The main driver of economic growth was construction. And the construction boom was a consequence of a new economic policy: stimulating growth by increasing expenditures.
Which is actually a very old economic policy. The Belarusian authorities followed this policy in the times of Peter Prokopovich with invariably repeated results. But apparently, the Belarusian ruble does not have enough adventures in life, since the officials decided to try it again.