The Belarusian Finance Ministry plans to maintain a zero-deficit budget in 2012-2015, Deputy Finance Minister Maxim Ermolovich said on July 10 at the presentation of a World Bank economic memorandum on the country.
"The main aim of Belarusian budget policy is to ensure a balanced budget. All budget policy to 2015 will be aimed at ensuring revenue covers spending and that a deficit is not used to support the economy," Ermolovich said.
In general the situation in Belarus is stable, there is no deficit in the budget with gold and currency reserves exceeding 8bn USD. At the same time the President pointed to aggravation of the world economy and demanded from the government secure the economic stability given the accession of Russia to the WTO.
Recently, the Belarusian economy has started to suffer hyperinflation, along with Ukraine. The hyperinflation has caused the government to implement a series currency controls. Following 9.9% growth in 2006 in the first quarter 2007, the Belarus GDP grew 8.2%. GDP further grew in 2008 by 10%.
In Belarus, budget revenues of the government sector for the first quarter of this year amounted to Br45.5 trillion (23.7% of the adjusted annual plan), said the Ministry of Finance. State budget revenues reached Br18.2 trillion (19.6% of the annual plan). General government budget expenditure amounted to Br41.4 trillion (21.7%), while the state budget - Br19 trillion (20.5%).
General government budget surplus totaled Br4.1 trillion in January-March, or 3.9% of GDP. The national budget deficit for the first quarter was Br0.8 trillion, or 0.8% of GDP.
In January-March 2012, VAT revenue amounted to Br8.4 trillion (17.8% of the adjusted annual plan). According to the Ministry of Finance, the income tax received Br9 trillion (62.2%). Excise reached Br2.1 trillion (18.8%). Proceeds from foreign trade activity amounted to Br5 trillion (19.7%). The Social Welfare Fund received Br11.2 trillion (23.6% of the annual plan).
April 1, 2012, arrears in taxes and fees amounted to Br77.7 billion (decrease to Br35.6 billion in March 2012).
The cost of the nation-wide activities is estimated at Br5.9 trillion (17%), to finance the national economy - Br5.6 trillion (21.4%), to finance the social sphere (social policy, education, health, physical culture, sport, culture and Media Foundation for Social Protection) - Br25 trillion (23.3%).
Tough budget policy will contain economic development, including in terms of carrying out broad reforms. On the other hand, the need for infrastructure development is constantly growing. However, "opportunities for funding, with a balanced budget, are lacking."
The Finance Ministry proposes a resolution by cutting current budget spending and then using the available funds to increase government capital investment. "This issue requires a solution, all budget reform will be tied to reducing public sector spending and restoring budget investment to the level it was at before 2009," the deputy minister said. This can be practically implemented by cutting budget spending on healthcare and education, through bringing these sectors as close as possible to real economic conditions and increasing their efficiency, he said.
As part of the former Soviet Union, Belarus had a relatively well developed industrial base; it retained this industrial base following the break-up of the USSR. The country also has a broad agricultural base and a high education level. Among the former republics of the Soviet Union, it had one of the highest standards of living. But Belarusians now face the difficult challenge of moving from a state-run economy with high priority on military production and heavy industry to a civilian, free-market system.
About 6.5 million square meters of housing will be built in Belarus next year. The construction sector is working badly with numerous problems in foreign and domestic projects. The President ordered to improve legislative framework in this field by April. The National Bank predicts that in 2013 the incomes of the population will exceed 600 USD.
Discussions with international organizations, including the World Bank, on the stages and speed of reforms in Belarus, need to answer three dominant questions: the first - how to restructure government companies; the second - how to increase the share of services in the economy and the third - how to redistribute capital flows toward highly productive sectors of the economy.
In January 2011 Belarusians started to convert their savings from belarusian rubles to dollars and euro. The situation was influenced by rumors of possible devaluation of the ruble. Exchange rates in Belarus are centralized by the government-controlled National Bank of Belarus. The National Bank was forced to spend $1 billion of the foreign reserves to balance the supply and demand of currency.
The 2011 budget showed a surplus of Br 3.28 trillion rubles, or 1.2% of GDP amid a planned deficit of 0.3% of GDP.
Recently, the Belarusian economy has started to suffer hyperinflation, along with Ukraine. The hyperinflation has caused the government to implement a series currency controls. Following 9.9% growth in 2006 in the first quarter 2007, the Belarus GDP grew 8.2%. GDP further grew in 2008 by 10%.
In Belarus, budget revenues of the government sector for the first quarter of this year amounted to Br45.5 trillion (23.7% of the adjusted annual plan), said the Ministry of Finance. State budget revenues reached Br18.2 trillion (19.6% of the annual plan). General government budget expenditure amounted to Br41.4 trillion (21.7%), while the state budget - Br19 trillion (20.5%).
General government budget surplus totaled Br4.1 trillion in January-March, or 3.9% of GDP. The national budget deficit for the first quarter was Br0.8 trillion, or 0.8% of GDP.
In January-March 2012, VAT revenue amounted to Br8.4 trillion (17.8% of the adjusted annual plan). According to the Ministry of Finance, the income tax received Br9 trillion (62.2%). Excise reached Br2.1 trillion (18.8%). Proceeds from foreign trade activity amounted to Br5 trillion (19.7%). The Social Welfare Fund received Br11.2 trillion (23.6% of the annual plan).
April 1, 2012, arrears in taxes and fees amounted to Br77.7 billion (decrease to Br35.6 billion in March 2012).
The cost of the nation-wide activities is estimated at Br5.9 trillion (17%), to finance the national economy - Br5.6 trillion (21.4%), to finance the social sphere (social policy, education, health, physical culture, sport, culture and Media Foundation for Social Protection) - Br25 trillion (23.3%).
Tough budget policy will contain economic development, including in terms of carrying out broad reforms. On the other hand, the need for infrastructure development is constantly growing. However, "opportunities for funding, with a balanced budget, are lacking."
The Finance Ministry proposes a resolution by cutting current budget spending and then using the available funds to increase government capital investment. "This issue requires a solution, all budget reform will be tied to reducing public sector spending and restoring budget investment to the level it was at before 2009," the deputy minister said. This can be practically implemented by cutting budget spending on healthcare and education, through bringing these sectors as close as possible to real economic conditions and increasing their efficiency, he said.
As part of the former Soviet Union, Belarus had a relatively well developed industrial base; it retained this industrial base following the break-up of the USSR. The country also has a broad agricultural base and a high education level. Among the former republics of the Soviet Union, it had one of the highest standards of living. But Belarusians now face the difficult challenge of moving from a state-run economy with high priority on military production and heavy industry to a civilian, free-market system.
About 6.5 million square meters of housing will be built in Belarus next year. The construction sector is working badly with numerous problems in foreign and domestic projects. The President ordered to improve legislative framework in this field by April. The National Bank predicts that in 2013 the incomes of the population will exceed 600 USD.
Discussions with international organizations, including the World Bank, on the stages and speed of reforms in Belarus, need to answer three dominant questions: the first - how to restructure government companies; the second - how to increase the share of services in the economy and the third - how to redistribute capital flows toward highly productive sectors of the economy.
In January 2011 Belarusians started to convert their savings from belarusian rubles to dollars and euro. The situation was influenced by rumors of possible devaluation of the ruble. Exchange rates in Belarus are centralized by the government-controlled National Bank of Belarus. The National Bank was forced to spend $1 billion of the foreign reserves to balance the supply and demand of currency.
The 2011 budget showed a surplus of Br 3.28 trillion rubles, or 1.2% of GDP amid a planned deficit of 0.3% of GDP.
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