High salaries fueled inflation in 2023 – think tank

February 6, Pozirk. High salaries accelerated Belarus’ price growth in 2023, says the recent report by the Košt Urada think tank that analyzes Belarusian finances.

Last year, salaries outpaced labor productivity, exacerbating the market imbalances and reducing the competitiveness of local goods and services, the experts said.

In December, salaries in Minsk exceeded the national average of 2,271 rubels ($708), rising to 3,240 rubels ($1,010). Real salaries in Minsk adjusted for inflation increased by 11.7 percent, while growth across Belarus ranged from 10 percent in the Homiel region to 13.3 percent in the Mahiloŭ region, Košt Urada reported, noting that by late 2023, salaries outpaced inflation.

Despite the central bank’s warnings, officials plan to keep raising salaries and pumping money into the economy ahead of the 2024-25 elections. However, the economy may be affected by shocks resulting from excessive money supply even before the election cycle is over, the experts warned.