After seven decades as a constituent republic of the USSR, Belarus attained its independence in 1991. It has retained closer political and economic ties to Russia than any of the other former Soviet republics. Belarus and Russia signed a treaty on a two-state union on 8 December 1999 envisioning greater political and economic integration. Although Belarus agreed to a framework to carry out the accord, serious implementation has yet to take place. Since his election in July 1994 as the country's first president, Alexander LUKASHENKO has steadily consolidated his power through authoritarian means. Government restrictions on freedom of speech and the press, peaceful assembly, and religion continue.

Belarus's economy in 2005 posted 8% growth. The government has succeeded in lowering inflation over the past several years. Trade with Russia - by far its largest single trade partner - decreased in 2005, largely as a result of a change in the way the Value Added Tax (VAT) on trade was collected. Trade with European countries increased. Belarus has seen little structural reform since 1995, when President LUKASHENKO launched the country on the path of "market socialism." In keeping with this policy, LUKASHENKO reimposed administrative controls over prices and currency exchange rates and expanded the state's right to intervene in the management of private enterprises. During 2005, the government re-nationalized a number of private companies. In addition, businesses have been subject to pressure by central and local governments, e.g., arbitrary changes in regulations, numerous rigorous inspections, retroactive application of new business regulations, and arrests of "disruptive" businessmen and factory owners. A wide range of redistributive policies has helped those at the bottom of the ladder; the Gini coefficient is among the lowest in the world. Because of these restrictive economic policies, Belarus has had trouble attracting foreign investment, which remains low. Growth has been strong in recent years, despite the roadblocks in a tough, centrally directed economy with a high, but decreasing, rate of inflation. Belarus continues to receive heavily discounted oil and natural gas from Russia. Much of Belarus' growth can be attributed to the re-export of Russian oil at market prices.

GDP (purchasing power parity): $70.68 billion (2005 est.)

GDP (official exchange rate): $26.69 billion (2005 est.)

GDP - real growth rate: 8% (2005 est.)

GDP - per capita (PPP): $6,900 (2005 est.)

GDP - composition by sector:
agriculture: 8.9%
industry: 26.8%
services: 64.3% (2005 est.)

Labor force: 4.3 million (31 December 2005)

Labor force - by occupation:
agriculture: 14%
industry: 34.7%
services: 51.3% (2003 est.)

Unemployment rate: 1.6% officially registered unemployed; large number of underemployed workers (2005)

Population below poverty line: 27.1% (2003 est.)

Household income or consumption by percentage share:
lowest 10%: 5.1%
highest 10%: 20% (1998)

Distribution of family income - Gini index: 30.4 (2000)

Inflation rate (consumer prices): 8% (2005 est.)

Investment (gross fixed): 20.7% of GDP (2005 est.)

Budget:
revenues: $5.903 billion
expenditures: $6.343 billion; including capital expenditures of $180 million (2005 est.)

Agriculture - products: grain, potatoes, vegetables, sugar beets, flax; beef, milk

Industries: metal-cutting machine tools, tractors, trucks, earthmovers, motorcycles, televisions, chemical fibers, fertilizer, textiles, radios, refrigerators

Industrial production growth rate: 15.6% (2005 est.)

Electricity - production: 30 billion kWh (2004)

Electricity - consumption: 34.3 billion kWh (2004)

Electricity - exports: 800 million kWh (2004)

Electricity - imports: 7 billion kWh (2003)

Oil - production: 36,000 bbl/day (2004 est.)

Oil - consumption: 252,000 bbl/day (2003 est.)

Oil - exports: 14,500 bbl/day (2003 est.)

Oil - imports: 360,000 bbl/day (2004 est.)

Natural gas - production: 250 million cu m (2004 est.)

Natural gas - consumption: 20.5 billion cu m (2005 est.)

Natural gas - exports: 0 cu m (2004 est.)

Natural gas - imports: 20.5 billion cu m (2005 est.)

Current account balance: $312.4 million (2005 est.)

Exports: $16.14 billion f.o.b. (2005 est.)

Exports - commodities:machinery and equipment, mineral products, chemicals, metals, textiles, foodstuffs

Exports - partners: Russia 47%, UK 8.3%, Netherlands 6.7%, Poland 5.3% (2004)

Imports: $16.94 billion f.o.b. (2005 est.)

Imports - commodities: mineral products, machinery and equipment, chemicals, foodstuffs, metals

Imports - partners: Russia 68.2%, Germany 6.6%, Ukraine 3.3% (2004)

Reserves of foreign exchange and gold: $835.4 million (2005 est.)

Debt - external: $4.662 billion (30 June 2005 est.)

Economic aid - recipient: $194.3 million (1995)

Currency (code): Belarusian ruble (BYB/BYR)

Exchange rates: Belarusian rubles per US dollar - 2,150 (2005), 2,160.26 (2004), 2,051.27 (2003), 1,790.92 (2002), 1,390 (2001)

Fiscal year: calendar year