Dollar at 3.3 Rubles and Slow Salary Growth. What to Expect from the Economy in 2026

Illustrative photo. Photo: LookByMedia

2025 on repeat?

According to the Eurasian Development Bank's forecast, in 2026, Belarus expects GDP growth of 1.8%, 7% inflation, and an average annual dollar exchange rate of 3.3 rubles.

The forecasts are made without taking into account the lifting of sanctions from Belaruskali. However, economist Dzmitry Kruk believes that the lifting of American sanctions will not significantly affect the overall macroeconomic picture, as European sanctions remain in place and it is unlikely that potash will be able to be supplied through Klaipeda in the foreseeable future.

"Based on what we have at the moment, any positive effect from the lifting of American sanctions on Belarusian potash, if it materializes, will only become tangible from the second half of 2026," Kruk believes.

The scenario for next year, considered by the EDB, World Bank, BEROC, IMF, and other forecasters, Kruk characterizes as an adaptation to an environment of weak growth.

Павялічыць

Illustrative photo. Photo: Nasha Niva

"The average figure for GDP growth is about 1.5%. The Belarusian economy is in a so-called overheated state, and further accelerating it through domestic demand is becoming increasingly difficult due to encountering economic imbalances.

Inflationary pressure, deterioration of the foreign trade balance, and the financial state of enterprises – all these factors restrain growth opportunities," the expert explains.

Kruk adds that Belarus's economy reached such slow growth already in the second half of 2025, and a similar trend of about 1.5% growth will continue next year.

With an eye on Russia

Kruk names the state of foreign trade as the main factor that could influence a certain deviation from the forecast indicators.

"There is a deterioration in foreign trade, demand from Russia has decreased, and there is currently no reason to expect it to increase. Regarding the Russian economy, forecasters almost unanimously say that Russia expects GDP growth within 1%," the economist points out.

According to the expert, an improvement in foreign trade indicators could occur if there is some growth in the export of potash fertilizers and petroleum products.

"But these factors are rather not determined by economic factors. In the base scenario, there are currently no prerequisites for fundamental changes in these industries. Therefore, the base scenario is that the volumes of potash and petroleum product exports will be close to 2025 levels."

Dzmitry Kruk calls the labor shortage, which led to excessively rapid wage growth, an important mechanism that has spurred growth in recent years.

Real wage growth will slow down

"Real wages have increased by approximately 35% compared to the pre-war period. This is very significant growth in less than four years. Wage growth will continue next year, and it will still be higher than GDP growth. But the pace will be significantly lower than in previous years.

Real wages are likely to increase by 3.5-5% in 2026," the expert believes.

This is explained by the fact that in conditions where wages grew faster than the economy, there is no longer much room to increase them.

Another important point that the economist draws attention to is that the growth plan is based on domestic investments. The situation was similar in 2025, and this plan was only about half successful.

"On the one hand, the authorities managed to stimulate demand for investments, they managed to ensure more financing for domestic investments by pushing banks, and by the end of 2025, investments contribute significantly more to GDP than before. But nevertheless, the result turned out to be much smaller than the government planned.

When it comes to 2026, there are no prerequisites for the situation to change, as the same accumulated macroeconomic imbalances will most likely not allow the planned investment growth to be achieved."

Probability of crisis — low

In summary, Kruk says that recession, significant inflationary surge, and strong currency depreciation are not to be expected in the base scenario for 2026.

"The probability of a negative crisis scenario developing can be given within 15%, while for the base scenario, i.e., the continuation of the 2025 trajectory, it's about 50-55%."

Dollar will get more expensive

As for exchange rates, according to the expert, the average annual exchange rate of the ruble to the dollar at 3.3 rubles, announced by the EDB, is a fairly realistic indicator.

Павялічыць

Illustrative photo. Photo: Nasha Niva

"The exchange rate of the Belarusian ruble is essentially determined by the state of the Russian ruble. The base scenario for 2026 is a gradual weakening of the Russian ruble. Among the dominant estimates for the equilibrium exchange rate of the Russian ruble in current conditions, the dollar is estimated at 95 Russian rubles. That is, it could depreciate by 18-20%.

But this does not mean that it must happen instantaneously. The same applies to the Belarusian ruble. Accordingly, 3.3 as an average annual rate is a realistic indicator," the expert clarifies.

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