World Bank2012-03-192012-03-192010-06-25https://hdl.handle.net/10986/2906This note attempts to analyze and tentatively answer these questions by focusing on the drivers of growth and productivity, labor markets and enterprise restructuring, as well as the state system of enterprise support, which is key to understanding the interplay between the state and the economy in Belarus. The period of analysis covers 2004-08 with appropriate references to the previous periods and comparisons with Russia and/or other Commonwealth of Independent States (CIS) countries. The final section explores the Belarus's industrial performance in the period of the global crisis (late 2008-09) and reviews the government's policies that have been largely responsible for a relatively mild effect of the crisis on economic dynamics in the country. The analysis is based on the official statistics provided to the team by the National Statistics Committee (Belstat), National Bank, and various ministries, as well as statistics from other national and international statistical sources. In addition, the analysis benefited from the data provided by various enterprise surveys undertaken by the Research Institute by the Ministry of Economy (RIME) and from two sector case studies (in machinery and dairy sub-sectors). Belarus has weathered the crisis so far better than most of its neighbors, in part due to the government policies to boost domestic demand in a predominantly state-owned and controlled economy. This was achieved at a considerable macroeconomic cost. The country's ability to sustain possible future shocks declined, and macroeconomic risks increased. The crisis has further exposed risks associated with the Government of Belarus (GOB) practice of heavy reliance on administratively set targets for large and medium-size enterprises, especially targets for output and average wage growth.CC BY 3.0 IGOACCESS TO CREDITACCESS TO FINANCEACCOUNTABILITYADMINISTRATIVE BARRIERSAGRICULTUREALLOCATION MECHANISMSARREARSATTRITIONAUTONOMYAVAILABILITY OF CREDITAVERAGE PRODUCTIVITYBALANCE OF PAYMENTSBANK CREDITBANK CREDITSBANK LOANSBANK RECAPITALIZATIONBANKING SYSTEMBANKRUPTCYBUDGET CONSTRAINTSBUSINESS DEVELOPMENTBUSINESS ENTRYBUSINESS PLANSCAPITAL STOCKCENTRAL BANKSCENTRALIZATIONCOMMERCIAL BANKINGCOMMERCIAL BANKSCOMPARATIVE ADVANTAGECOMPETITIVE ADVANTAGESCOMPETITIVENESSCONSOLIDATIONCONSUMER PRICE INDEXCONSUMER SUBSIDIESCONSUMERSCORRUPTIONCOST OF CREDITCPICREDIT ALLOCATIONCREDIT ALLOCATIONSCREDIT AVAILABILITYCREDIT DECISIONSCREDIT GUARANTEESCREDIT LINESCREDIT MARKETSCREDIT POLICYCREDIT PROGRAMSCREDITSCUSTOMER DEMANDDEVELOPMENT POLICYDIRECT CREDITDIRECTED CREDITDIRECTED CREDITSDRIVERSECONOMIC COOPERATIONECONOMIC DYNAMICSECONOMIC GROWTHECONOMIC PERFORMANCEECONOMIC POLICYECONOMIC RECOVERYECONOMIC SECTORSECONOMIC STRUCTUREECONOMIC SYSTEMECONOMIES IN TRANSITIONEDUCATIONAL CAMPAIGNSEFFECTIVE ALLOCATIONEMPLOYEREMPLOYMENTEMPLOYMENT GROWTHENERGY EFFICIENCYENTERPRISE CREDITENTERPRISE GROWTHEXCHANGE RATEEXCHANGE RATESEXPLICIT SUBSIDIESEXPORT EARNINGSEXPORT GROWTHEXPORTSFINANCIAL DISTRESSFINANCIAL PERFORMANCEFINANCIAL RESOURCESFINANCIAL SECTORFINANCIAL SUPPORTFISCAL RESOURCESFIXED CAPITALFOREIGN CURRENCYFOREIGN DIRECT INVESTMENTFOREIGN DIRECT INVESTMENTSGDPGOVERNMENT DIRECTED CREDITGOVERNMENT INTERVENTIONSGOVERNMENT POLICIESGOVERNMENT POLICYGREATER ACCESSGROSS DOMESTIC PRODUCTGROWTH RATEHIGH INTEREST RATEHIGH INTEREST RATESHIGH WAGESHOUSEHOLDSHOUSINGHUMAN CAPITALINDUSTRIAL ENTERPRISESINEQUALITYINFLATIONINNOVATIONINNOVATIONSINSTALLMENTINTEREST RATESINTERNATIONAL BANKINVENTORIESINVENTORYINVESTMENT GRANTSLABOR COSTSLABOR MARKETLABOR MARKET ISSUESLABOR MARKETSLABOR MOBILITYLABOR MOVEMENTSLABOR PRODUCTIVITYLABOR REGULATIONSLABOR SHORTAGESLABOR TURNOVERLABOURLABOUR PRODUCTIVITYLEGISLATIONLENDING POLICIESLIQUIDATIONLOANLOCAL GOVERNMENTLOCAL GOVERNMENTSMACROECONOMIC MANAGEMENTMACROECONOMIC POLICYMANDATESMARKET DISCIPLINEMARKET DISTORTIONSMARKET INEFFICIENCYMARKET INSTRUMENTSMARKET PRICESMETALSMIDDLE INCOME COUNTRYNATIONAL ECONOMYNEW ENTRANTSOILOIL PRICESOUTPUTSOWNERSHIP STRUCTUREPENALTIESPERVERSE INCENTIVESPRICE CONTROLSPRICE INCREASESPRIVATIZATIONPRIVILEGED ACCESSPRODUCERSPRODUCT MARKETSPRODUCTION PROCESSESPRODUCTIVE ASSETSPRODUCTIVITYPRODUCTIVITY GROWTHPRODUCTIVITY INCREASESPROFIT MARGINSPROFIT MAXIMIZATIONPROFIT MOTIVEPROFITABILITYPROFITABLE BUSINESSPUBLIC FINANCEPUBLIC SERVICESPUBLIC TRANSPORTATIONPURCHASING POWERPURCHASING POWER PARITYREAL GDPRECAPITALIZATIONRECESSIONRENT SEEKINGRENTSREPAYMENTRESOURCE ALLOCATIONSAVINGSSKILLED LABORSMALL BUSINESSESSOCIAL DEVELOPMENTSOFT BUDGET CONSTRAINTSSOURCES OF INCOMESTATE ENTERPRISESSTATE SUPPORTSUBSIDIARIESSUBSIDIZATIONSUPPLIERSSUPPLY CHAINSTAX ADMINISTRATIONTAX CREDITTAX EXEMPTIONSTAX INCENTIVESTAX REVENUESTAXATIONTERM CREDITTERMS OF TRADETIMBERTOTAL COSTSTOTAL FACTOR PRODUCTIVITYTOTAL OUTPUTTRADE NEGOTIATIONSTRANSITION ECONOMIESUNIONVALUE ADDEDWAGE INCREASESWAGE POLICYWAGESWORKING CAPITALWORLD TRADE ORGANIZATIONWTOWorld Bank10.1596/2906