belarus Is Eating into Its Reserves and Becoming Dependent on russia’s Money

In 2025, belarus spent more than it earned. Consolidated budget expenditures exceeded 30% of GDP for the first time since 2010, while the economy grew by only 1.3% – a result that in no way justifies such massive fiscal injections. These conclusions were drawn by analysts from the MacroBy initiative in their report “Belarus Economy Monitor”.

Tax revenues, which account for over 80% of the treasury’s income, declined slightly –from nearly 25% of GDP in 2023–2024 to 24% in 2025 – due to a reduction in revenues from foreign economic activity. This decline was partially offset by non-tax revenues, first of all transfers from russia, including compensation for reverse excise taxes for belarusian oil refineries. Their share reached 1.8% of GDP – a level last seen in 2018, when the customs re-clearance scheme for russian oil was in effect. “Thus, the belarusian budget’s dependence on russian transfers increased in 2025,” economists note.

The main driver of expenditure was wages for public sector employees: they rose by 18% in nominal terms and may have reached 10% of GDP, or one-third of all consolidated budget expenditures.

To plug the hole that taxes failed to cover, the national bank purchased government bonds worth 2.3 billion rubles (about 0.8% of GDP), effectively financing the deficit through issuance.

The situation will worsen. In 2026, analysts expect the deficit to grow to 1–1.5% of GDP: revenues will slow due to the economic slowdown, while expenditures will remain high. A certain buffer exists, but it will no longer be possible to significantly increase spending.