Belarus raising economic growth target for 2012 to 5-5.5% from 1.5% - source
MINSK. Nov 23 (Interfax) - The leadership of Belarus has given general approval to the government's revised socioeconomic development forecast for 2012, a source at the Economics Ministry familiar with the new government proposals discussed at a meeting on Tuesday told Interfax.
He said the tentatively approved GDP growth target for 2012 is now 5-5.5%, far higher than the growth forecast of 1-1.5% that was rejected by the president and which the government had said was aimed at balancing the economy.
The new forecast projects that inflation will slow to 19-22% in 2012 from at least 120% in 2011. The ministry official said the inflation target remained generally unchanged from the previous draft of the forecast, but he voiced concerns about plans being discussed by a number of agencies to not include this target in the socioeconomic development forecast to be approved by the president. In that case, the chances of a noticeable decrease in inflation will be reduced, he said.
He also said that at the current stage of discussions, the draft forecast does not have an industrial production growth target. The previous draft also did not have such a target.
The draft forecast might also exclude the target for foreign direct investment to be raised with the sale of state property. The target previously aimed to raise $2.5 billion with privatization.
The source said the new version of the forecast slashes the foreign trade surplus target to 0.5% of GDP from 3% of GDP.
The 2012 growth target for real disposable personal incomes has been raised to about 3% from 0.5%.
The ministry official said that at this stage of work on the draft the forecast for net monetary financing of the economy in 2012 remains at Br7 trillion.
Annual average interest rates on the money market are forecast at 35% annually with a GDP deflator close to 170%.
President Alexander Lukashenko on November 10 harshly criticized the government for targeting slower GDP growth of 1.5% next year with the aim of slashing inflation by further dampening domestic demand and with the aid of market mechanisms. He demanded the government draft an economic forecast for 2012 that would be consistent with the socioeconomic development program for 2011-2015, which targets GDP growth of 62-68% over this period. The program has been approved by the national assembly and by presidential decree. Lukashenko said the program targets could not be revised and demanded that the government meet them.