Thursday, January 31 2019 13:20

ArmInfo. In Armenia, the growth of economic activity in January- December 2018 slowed down to 5.8% per annum, against acceleration in 2017 to 7.7% from 0.5% in 2016.  

The drivers were the service sector and the commercial sector, with a  modest growth in the industrial sector and the agricultural sector  remaining in slowdown. According to preliminary data of the RA  Statistical Committee, in December 2018 alone, an increase of 24.3%  was recorded with a y-o-y growth of 6.4%, while the year before  December growth was slightly more modest - 21.8%, and the y-o-y  growth was higher - 12.6%.

The growth of economic activity in January-December 2018 continues to  be mainly supported by the service sector - by 18.8% per annum and by  the trade sector - by 8.7%, against the background of modest growth  in the industrial sector - by 4.3%, the construction sector - by 4,  5% and the power complex - by 0.2%. The agricultural sector,  remaining in a downturn, accelerated the pace to 7.6% from 3% in  2017. A year earlier, in January-December 2017, the service sector,  the commercial sector and the industrial sector showed the highest  growth- 14.4%, 14% and 12.6%, respectively, with a relatively modest  growth of the energy sector by 6.1% and the construction sector - by  2, 2%..

The industrial price index increased by 1.6% in January-December 2018  compared to the same period of 2017, decreased by 1.2% in December  2018 versus December 2017, and increased by 0.5%in December 2018  alone, against corresponding growth  by 3.9%, 3.2% and 0.8% in the  same periods of 2017.

In monthly terms (in December 2018 ) , only the energy complex (0.7%)  recorded slowdown, while all other areas showed growth: the  construction sector - 84.7%, trade - 34.1%, the agricultural sector -  22.1 %, services - 15.7%, industrial sector - 12.5%. A year earlier,  in December 2017, growth was also observed in all areas: the  construction sector - 83.4%, trade - 35.1%, the power complex -  32.2%, the agricultural sector - 11.1%, the industrial sector -  10.2%, the service sector- 10.1%.

In  y-o-y terms (December 2018 versus December 2017), the volume  decline was recorded in the agricultural sector and the energy  complex - by 2% and 18.7%, respectively, and in other areas growth  was observed: the service sector - 22.2%, industrial sector - 5.5% ,  trade - 4.8%, construction - 1.2%. A year earlier, in December 2017  to December 2016, all industries showed growth: the energy complex -  17.8%, the services sector and the industrial sector - 15.6% each,  trade - 12.7%, construction - 10.4% and the agricultural sector - 3,  3%.

According to statistics in January-December 2018, in absolute terms,  the leadership is held by the commercial sector with a volume of 2.9  trillion drams ($ 6.1 billion). It has been almost a year since the  services sector has moved to the second position-1.8 trillion drams  ($ 3.7 billion), displacing the industrial sector to third place -  1.7 trillion ($ 3.6 billion), in the fourth - the agricultural sector  - 889.7 billion drams ($ 1.8 billion), and in the fifth - the  construction sector - 422.3 billion drams ($ 874.3 million). The  volume of electricity generation in January-December 2018 was 7776.9  million kWh, of which 671.5 million kWh.  in December alone.

At the same time, the foreign trade turnover of Armenia in  January-December 2018 amounted to 3562.7 billion drams ($ 7,375.1  million) with a slowdown in y-o-y growth to 16.4% from 26.9% in 2017.  In its structure, the volume of exports has significantly slowed  y-o-y growth - up to 7.8% from 25.2% in 2017, amounting to 1164.9  billion drams ($ 2411.9 million), while the y-o-y growth of imports  slowed down slightly - to 21.1% from 27.8% in 2017, making 2397.8  billion drams ($ 4963.2 million).

The average exchange rate of dram in December 2018 was 484.67  AMD/ $  1, and in January-December - 482.99 AMD / $ 1, against 483.18 AMD/ $  1 in December 2017 and 482.72 AMD/ $ 1 - in January- December 2017.  It should be noted that according to the World Bank's forecast for  2018 updated in January 2019, there was an improvement in  expectations for Armenia's GDP growth by 5.3% (versus the previous  4.1%), by 2019 - by 4.3% with an acceleration in 2020 to 4.6 % and  the persistence of these rates in 2021.  Moreover, the WB designated  the industrial sector as drivers of economic growth in Armenia for  2019 - 6.1%, while for the services sector and the agricultural  sector, expectations were more modest - growth of 3.9% and 2.9%  respectively, while GDP growth drivers for 2018 services and  industrial sector were mentioned - 6.3% and 5%, respectively, with  the growth of the agricultural sector by 2.5%. For 2019, the WB  predicts export growth by 8% in Armenia's foreign trade, while  imports grow by 11.8% (against the previously forecasted 9.8% and  9.5%, respectively), and for 2020 - export growth by 7.9%, while  import growth by 9.2%, against the growth of export and import  projected for 2018 by 9.1% and 16.9%, respectively.

To recall, the Central Bank of Armenia in November 2018 corrected  range of forecast for GDP growth: for 2018 - from the previous  5.6-6.9% to updated 4.6-5.1%. Simultaneously, the regulator revised  towards slowing down the expected growth threshold in the medium  term: in 2019 - 4.4-5.5% and for 2020 - 3.9- 5.4% (versus the  previously forecast 4.6-6.4% and 4.1-6.2%, respectively). In the  state budget of the Republic of Armenia for 2018, GDP growth of 4.5%  is laid, and in the state budget for 2019 - by 4.9%.