MINSK, January 1 (RIA Novosti) – In his New Year’s address, Belarusian President Alexander Lukashenko hailed 2013 as a ‘watershed year’ for the country's economy.

“The coming year will be a watershed for the economy. We have no other choice,” Lukashenko said.

He stressed the importance of modernization as key to the state’s resilience and the population’s prosperity. And, praising the economy’s stability, he noted that the country was little touched by the financial and economic crisis in 2012.

EU sanctions on Belarus were extended in 2012 due to continuing concerns within Europe over political persecution and human rights.

A recent World Bank report on the country's economy, covering the period to 2011, notes the advances made in reducing poverty and boosting growth over the past decade. However it also points to “loose macroeconomic policies” as causing “a severe balance of payments and foreign exchange crisis, accelerated inflation and the loss of the previous year’s income gains,” in 2011.

Russia’s trades union federation recently likened one headline-grabbing move – banning timber industry workers from resigning – to serfdom.

In December, Russian Trade Union Federation head Mikhail Shmakov wrote an open letter to Lukashenko criticizing the law and calling for it to be repealed.