The acceleration of Belarus’s GDP growth in the second quarter was driven by the authorities’ stimulative policies, as well as a number of specific factors, including geopolitics and weather conditions. This is stated in an express analysis of the Belarusian economy prepared by the experts at MacroBy.
“In the first half of the year, GDP increased by 1.5% year on year, while in June alone it grew by approximately 3.5% year on year. Compared with May 2026, the seasonally adjusted output volume edged slightly lower. However, thanks to strong growth in the spring months, GDP growth in the second quarter as a whole reached its highest level in more than a year, at around 3% year on year,” the report says.
According to its authors, the increase in gross domestic product was supported by stronger consumer and investment demand amid the authorities’ stimulative policies. Growth was also boosted by several specific factors, including higher prices and stronger demand for Belarusian fertilisers due to the Strait of Hormuz crisis, increased processing of toll crude oil, weather conditions and calendar effects.
GDP dynamics are expected to remain volatile in July and August due to the impact of the harvesting campaign. Nevertheless, GDP growth could reach 2% by the end of the second quarter and 1.5%–2.5% for the year as a whole.
“The wide range reflects the high level of uncertainty surrounding external conditions. The impact of destructive non-economic factors on the Russian economy is becoming an increasingly significant risk for the Belarusian economy. If the situation on Russia’s fuel market does not deteriorate further, the balance between supply and demand continues to recover, and no additional infrastructure disruptions occur, Belarus’s GDP growth is likely to be closer to the upper end of the forecast range,” MacroBy said.
The same factors are expected to affect inflation. In the analysts’ baseline scenario, inflation is projected to rise from 4.3% in June to 5%–6% by the end of the year.
“A significant easing of price controls in July could accelerate price growth for non-food goods. However, there is a high probability that this increase will be moderate, while the relatively low pace of goods price growth compared with services observed in 2023–2026 was largely a regional phenomenon associated with changes in competition mechanisms amid the expansion of e-commerce,” the report says.
The authors also point to strong growth in value added in agriculture, as well as a recovery in industry. Industrial output could return to growth in the third quarter, although production volumes currently remain below last year’s level.
However, much depends on the situation in Russia. Fuel shortages are affecting demand as well as logistics chains. At the same time, the experts note that Russia’s fuel problems do not pose a threat to the stability of the Belarusian fuel market. Domestic oil refineries continue to operate below full capacity and are able to meet domestic demand with a comfortable margin.
