Belarus' industrial output growth crashed to 0.9% year-on-year in January this year, down from 5.7% in December and 9.7% y/y growth in January of 2018, according to the national statistics agency Belstat.
The statistics agency did not provide full sectorial data, so it is unclear to what factor the result is attributed. According to official data, the nation's output rose by 5.7% y/y in 2018 and 6.1% in 2017.
Belarus' GDP grew by 3% y/y in 2018, and by 2.4% y/y in 2017 after two years of recession. It contracted 3.9% y/y in 2015 following 1.6% y/y growth in 2014.
Recently, the Belarusian government was forced to revise downward its forecast for the country’s GDP growth in 2019 (from 4.5% y/y to 2.1% y/y). According to Belarusian officials, the new forecast takes into account recent changes in the external economic environment, including changes in oil prices and the economic situations of the country's major trading partners, specifically Russia, and the values of their currencies.
Specifically, the target scenario was initially based on an oil price assumption of $70 per barrel, but the assumption was eventually reduced to $65 per barrel.
Minsk's forecast also takes into account the negative consequences of Russia’s so-called tax manoeuvre on Belarus. The tax manoeuvre shifts the tax burden from export duty on oil and petroleum products to mineral extraction tax (MET) on oil production. It envisages a gradual reduction in the rate of export duty on oil and petroleum products from 30% to zero in the period from 2019 to 2024 and a proportionate increase in MET.