The average monthly inflation of 1.5% will persist until the end of 2012

June 29, Minsk /Lilia Krapivina - BELTA/. The average monthly inflation in Belarus at the level of 1.5% will remain until the end of 2012. This was stated today to journalists by Anton Dolgovichny, Head of the Main Department of Macroeconomic Analysis and Forecasting of the Ministry of Economy, as reported by a BELTA correspondent. In Belarus, based on the results of five months, inflation amounted to 8.5%, and the forecast for 2012 of 20-22% is being met. "I think inflation will be around 20%, an average of 1.5% per month, this level of average monthly price growth will continue until the end of the year," Anton Dolgovichny noted. This is due to the inertia of inflationary processes, as well as the devaluation potential accumulated last year. The growth of consumer prices may be somewhat higher due to the increase in utility tariffs. Belarus has international obligations to the EurAsEC Anti-Crisis Fund, Anton Dolgovichny recalled. But there are also social obligations of the state to the population, he added. "But we will maintain a balance regarding wage growth and the increase in utility tariffs," said the representative of the Ministry of Economy. In Belarus, monetary and fiscal policies have been tightened, which has had a restraining effect on investment expenditures. As a result, investment expenditures in machinery and equipment decreased by approximately 14% during the past period of the current year. But this is an objective factor due to the high interest rate, which in turn also helped to curb inflation growth. Anton Dolgovichny commented on the results of the socio-economic development of the republic for 5 months of 2012. "Overall, if we look at the industry dynamics, the 2011 currency crisis did not turn into an economic one, there is no recession, there is positive growth dynamics," he emphasized. This was also confirmed by the growth in the number of legal entities in Belarus. As of June 1, 2012, there were 3% more of them compared to the beginning of the year and 4.5% more compared to June 1 of last year. Moreover, the increase was noted in the non-state sector. "This indicates a recovery in business activity in Belarus," the expert stressed. Industry formed the basis of economic growth (GDP growth rate of 103.1% for 5 months). At the same time, industry contributed 2% to GDP growth. The main industries that ensured the dynamics of industrial production are oil refining (an increase of 18%) and the chemical industry (an increase of 37%). Stocks of finished products are at a stable level and amount to slightly more than 51% of the average monthly production level. According to Anton Dolgovichny's assessment, this is significantly lower than the stock indicators over the past 10 years, which indicates efficiently developing production. In addition, trade, transport and communications, and agriculture made a significant contribution to GDP growth. Labor productivity growth in terms of value added was 5.3%. Positive dynamics are also maintained in the financial condition of industrial enterprises. Their profitability has significantly increased to over 11%, which is above the projected level. Measures have been taken in Belarus to compress domestic demand. This led to a reduction in construction volumes, as a result, the contribution of the construction industry to GDP formation is negative - minus 1.3%, stated Anton Dolgovichny. He also pointed to the still low inflow of net direct foreign investment. It amounted to $605.7 million for January-May. According to the expert's assessment, there is not yet an active process of creating new high-tech jobs in the republic. Positive trends continue to strengthen in foreign trade in goods and services. An increase in the positive balance in foreign trade in goods and services was ensured in January-April in the amount of $2.3 billion. This result has been achieved in the republic for the first time in the last 5 years, Anton Dolgovichny emphasized. -0-