In the Soviet tradition, the state continues to dominate the economy; the gross domestic product (GDP) is mainly generated by state-owned companies. A market economy has only just begun to develop. After the collapse of the USSR In 1991 there was initially a dramatic decline (1990–96 average decline in GDP of around 9% per year). The country has experienced an upswing since 1996; In 2002 Belarus reached the pre-crisis level again. From 2004 to 2008 the annual growth rates were around 10%; after a slump in 2009, growth rates of less than 2% were achieved. Due to the economic crisis in neighboring Russia, Belarus’ most important trading partner by far, GDP even fell by 3.9% in 2015. A growth of 3.0% is stated for 2018. Due to the inadequate legal certainty, foreign direct investment fell from US $ 2.2 million in 2013 to US $ 1.28 million (2017). Visit cachedhealth.com for Europe economic spatial models.
Foreign trade: The trade balance is chronically negative (2018 exports: US $ 33.5 billion; imports: US $ 38.2 billion). With a share of 38.5% in exports and 58.6% in imports, Russia is by far the most important trading partner. Ukraine, Great Britain and Germany follow. In addition to energy raw materials and electrical energy, the main import goods are chemical products, machines and industrial equipment, food and vehicles as well as metallurgical products. Important export goods are mineral products, food, fertilizers and other chemical products.
With decreasing importance, agriculture contributes 7.6% (2017) to GDP, 9.9% of the workforce work in agriculture and forestry. In the agricultural sector, the collective farms and sovkhozes from the Soviet era continue to dominate who still cultivate around 80% of the agricultural area. Nevertheless, private farmers and allotment gardeners generate over a third of agricultural production. The agricultural area comprises around 5.7 million hectares of arable land and 2.7 million hectares of meadows and pastures. Important reasons for the decline in arable land (in 2011 still 6.3 million ha) are, among others. the closure of agricultural areas as a result of the contamination by the Chernobyl reactor accident and the declining productivity of the soil as a result of intensive use, as well as the increasing aging of the rural population. The highest yields are achieved in the Grodno area due to the high quality of the soil, and the Brest areas are also important agricultural regions and Minsk. The main products of arable farming are potatoes, cereals, sugar beets, vegetables and rice. Cattle breeding is characterized by cattle, pig and poultry breeding.
Forestry: In Belarus, the forest is intensively used due to logging, especially the oak forests are endangered by excessive use. In addition, the forest stand is threatened by extensive forest fires. Thanks to afforestation, the forest area has increased again slightly since the 1990s (1990: 37.5% of the state’s area; 2016: 42.6%).
The main raw material of Belarus is potash salt. An important mining center is located near Soligorsk in Polesia. In addition, the country has significant peat deposits (exploitable reserves of up to 1.2 billion t). To a lesser extent, crude oil and gas are extracted from small deposits (with a decreasing tendency) in the Pripjet Depression. Existing lignite deposits have so far hardly been used due to their low calorific value and high ash content.
Because of the low resources of energy raw materials Belarus is almost completely dependent on imports of energy carriers, especially from Russia. Since 2004 Belarus has been relying more on its own production (thermal and hydroelectric power plants) of electricity. The generation of electrical energy rose from 26.6 billion kWh (2003) to 33.6 billion kWh (2016). The first Belarusian nuclear power plant has been under construction near the border with Lithuania since 2013, and Unit 1 has been officially in operation since November 2020.
The share of industry (including mining and construction) in GDP is 31.6% (2017); 31.2% of the workforce are employed here. Due to a lack of foreign exchange, the industry has suffered from a lack of investment for years, which leads to increasing wear and tear of the capital stock (machines, systems, infrastructure) and decreasing competitiveness of companies. The most important branches of industry are machine (agricultural, machine tools, armaments), vehicle (cars, tractors, motorcycles, bicycles) and equipment (communications engineering), the chemical industry (chemical fiber, fertilizer production) including petroleum processing (refineries in Mosyr and Novopolotsk) as well as the food industry and leather processing. Traditional branches of industry that use local raw materials are the textile (especially the manufacture of linen and silk fabrics), wood and building materials industries. The main industrial centers are Minsk, Gomel, Vitebsk, Mogilev, Grodno, Novopolotsk, Svetlogorsk and Soligorsk.
Belarus is an important transit country for the movement of people and goods from Central European countries to Russia and the Baltic states. The most important hub for rail traffic is Minsk. In Brest and Grodno, the chassis is changed by changing the track width. 87% of the trunk roads are paved. The inland waterway network covers around 3,800 km. An economic disadvantage is the lack of direct access to the sea. The country has a waterway connection to the Baltic Sea and the Black Sea via the Dnieper Bug Canal. Important export pipelines from Russia for crude oil run through Belarus (Petroleum Pipeline Friendship) and natural gas (Yamal-Western Europe gas pipeline). The only airport with international connections is in Minsk.