30.05.2026
Belarus’ economy slowed sharply in 2025 as the post-2022 adaptation boost faded, Russian demand weakened and sanctions-related logistical frictions continued to weigh on exports. Growth is expected to remain very modest in 2026–2027, relying mainly on state-supported construction, tight labour markets and policy stimulus, while industry and external trade remain constrained. Inflation is projected to stay elevated despite administrative price controls, gradually eroding real wage gains. Fiscal and debt indicators remain relatively stable on headline measures, but transparency has weakened since 2022, and the economy remains increasingly dependent on Russia for trade, finance, logistics and energy.
| Indicators | 2025 | 2026 | 2027 |
|---|---|---|---|
| GDP growth (%, yoy) | 1.3 | 1.1 | 0.8 |
| Inflation (%, yoy) | 6.7 | 6.6 | 6.5 |
| Upper-middle-income poverty rate ($8.30, 2021 PPP, %) | 1.5 | 1.4 | 1.3 |
| Fiscal balance (% of GDP) | 0.5 | 0.4 | 0.2 |
| Gross public debt (% of GDP) | 37.0 | 36.7 | 36.5 |
| Current account balance (% of GDP) | -2.4 | -2.7 | -2.9 |
Growth slows as adaptation gains fade
Belarus’ real GDP growth slowed to 1.3% in 2025, down from 4.3% in 2024. The slowdown reflected weaker external demand, especially from Russia, sanctions-related logistical constraints and persistent supply-side bottlenecks. Agriculture was nearly flat due to poor weather, while construction and ICT provided partial support.
Growth is projected to weaken further to 1.1% in 2026 and 0.8% in 2027. State-supported construction, fiscal measures and tight labour-market conditions should continue to support domestic demand, but manufacturing and exports are expected to remain constrained by sanctions, payment bottlenecks, higher logistics costs and limited access to global markets.
Inflation remains elevated despite price controls
Inflation increased to 6.7% in 2025, driven by strong domestic demand and food-price pressures. Administrative price controls helped limit the headline rate, but they also distort relative prices, weaken monetary transmission and delay adjustment.
Inflation is projected to remain above 6% in 2026–2027. Tight labour markets and rising wages will support household income, but elevated inflation is expected to gradually compress real wage gains. The main risks come from food prices, exchange-rate movements linked to the Russian ruble, domestic stimulus and supply constraints.
Fiscal indicators remain stable, but transparency is limited
The headline fiscal balance remained in surplus in 2025, at 0.5% of GDP, and is projected to stay slightly positive in 2026–2027. However, since the start of the war in Ukraine, regular publication of budget data has largely ceased, making it harder to assess the true fiscal position.
Public debt is projected to remain broadly stable, declining slightly from 37.0% of GDP in 2025 to 36.5% in 2027. Headline debt levels are moderate, but fiscal risks are linked to state-owned enterprises, directed lending, subsidies, administrative controls and dependence on Russia-linked financing and markets.
External position weakens gradually
The current account deficit is estimated at 2.4% of GDP in 2025 and is projected to widen to 2.7% in 2026 and 2.9% in 2027. Imports have grown faster than exports, supported by domestic demand and policy stimulus, while exports remain constrained by weak Russian demand, sanctions, logistical frictions and limited access to higher-margin markets.
The external position remains structurally vulnerable. Most exports are now oriented toward Russia or routed through Russian logistics and financial channels. This reduces diversification, increases transaction costs and exposes Belarus to shocks from Russian demand, sanctions enforcement and payment restrictions.
Overall outlook
Belarus’ outlook is weak and increasingly constrained by its economic model. Growth is expected to remain below 1.5% in 2026–2027, inflation will stay elevated, and external deficits are projected to widen gradually. The main risks are deeper dependence on Russia, sanctions, weak productivity, labour shortages, administrative price controls and reduced fiscal transparency. Sustained improvement would require broader market access, stronger private-sector development, better policy transparency and structural reforms, but these remain unlikely under current conditions.
Sources:
World Bank, Belarus Macro Poverty Outlook, April 2026.
International Monetary Fund, World Economic Outlook, April 2026.
European Bank for Reconstruction and Development, Regional Economic Prospects, February 2026.
Vienna Institute for International Economic Studies, Belarus Economic Overview, 2026.
National Bank of the Republic of Belarus, Monetary Policy and Financial Market Developments, 2025–2026.
