Eurasian Development Bank analysts: Russia and Belarus to demonstrate lowest development rate among CIS countries in 2012

Russian,Belarus banks to have lowest development rate among CIS countries - analysts

Russia and Belarus will demonstrate the most modest rate of economic
growth among CIS countries in 2012 - 4.1% and 3% respectively, reads
the report of the Eurasian Development Bank (EDB) 'Makromonitor CIS. "

Moreover, according to the report, the overall GDP growth of the CIS
countries will amount to 4.6%, while the highest growth is expected in
Turkmenistan (8.4%) and Uzbekistan (7.4%).

The EDB highlights two major risks to economic growth in the region: a

drop in demand for main export commodities (hydrocarbons, cotton and
metals) and  well as pressure of volatility  on the financial markets
on the private investment activity.

"In the situation  of the uncertain global economic impact  on the
region, it is necessary to conduct  the sound macroeconomic policies.
In particular, the policy on free-floating exchange rate will help
cushion the effect of the external shocks, while the  control of money
growth will allow central banks to prevent overheating of their
economies, limiting their vulnerability to these shocks, "recommends
the organization.

In addition,  the EDB gives an assessment of growth in GDP of CIS
countries in January-September 2011. The highest rate of all the CIS
countries shows the economy of Turkmenistan - 14.6%, the lowest -
Azerbaijan (0.5%).

EDB experts point out that the third quarter of 2011 showed a dynamic
growth in the sector of agriculture in the CIS countries although all
countries except Armenia, Kyrgyzstan and Moldova slowed the
development of industry.

The investment in real estate also increased. Growth in housing
construction in the first nine months of 2011 was recorded  in
Azerbaijan, Kazakhstan, Moldova and Russia.
It was also mentioned that the growth of the economies of Russia and
Kazakhstan had a favorable effect on the flow of remittances from
migrant workers, which stimulated the growth of the economies of
labor-exporting countries. In the first nine months of 2011,
remittances from Russia to CIS countries in dollar terms was by 39%
higher than the same  figure for the period January-September 2010.

"The restoration of the CIS economies has a positive impact on the
fiscal sector - several countries show budget surplus or reduction of
budget deficit, " concludes the EDB expert.