Friday, December 9 2016 15:55
Naira Badalian

An economic recession started in Armenia: WB sharply decreases the  2016 economic growth forecast down to zero.

An economic recession started in Armenia: WB sharply decreases the  2016 economic growth forecast down to zero.

ArmInfo. The World Bank has revised again the forecast on the economic growth in Armenia in 2016, decreasing it down to zero. Earlier in January the Bank forecasted the GDP growth at 2,2% level, in March - for 2,5%. On June 2017 Laura Bailey, the World Bank's Country Manager for Armenia, stated that  for the current year the Bank forecasts the economic growth of the country at 1,9 % level. To note,  in the recent official WB report the GDP forecast in respect to Armenia kept the 3,1 level.

But, as the senior economist of the WB Armenian office Gohar Gylumyan stated, the indicators of Armenia's economic activity, starting with July 2016, turned disappointing. " after the  4,5 % economic growth in Q1 of 2015, Armenian economy faced the drop down, and the decrease of economic activity is expected in monthly view from July to October," she stated. According official data, as expert stated, in the third quarter the economic growth formed 2,8% versus to that of the  2015 similar period.  Proceeding from that, WB experts have also reviewed their forecasts, she added. " And if  in October the WB expectations due to the results of 2016  were still positive  (2,4%), and based on that indicator a 2,8% growth  in 2017 and for middle term prospective a 3% growth was  forecasted, than now, based on January-October data, when the indicator of economic activity formed only 0,4%, the forecasts of our experts, complete but not published yet, showed that due to 2017  results  there will not be an economic growth in Armenia, or, to the best, the growth will be at zero, Gyulumyan stated. What is to 2017 expectations, according to the expertbeased on the results mentioned WB expects economic activity indicators not exceeding. 2%, and in mid term prospective - in the limits of 2-2,5%.  

To note, the economic activity growth in  Armenia during January-October 2016 slowed down to 0,4% from 3,5 % in 10 months of 2015, and the drivers were still the services, industrial sector, and particularly, the agriculture. In 2014, the economic activity growth  for the similar period was much higher - up to 4,2%. According to preliminary data of National Statistics Service of Armenia, only in October the dropdown for 18,7% was fixed, within the annual dropdown for 7,8%.

According to the state budget, the GDP growth in Armenia for 2016 is planned at 2,2 %, and for 2017 - 3,2%. EABD expects growth for 2%, Fitch -  up  to 2%. Moody's expects the GDP slowdown in Armenia for 2%. Independent economists thin that from the autumn a long economy recession started , which could even turn into long term economic  stagnation. To reach positive economic effects, Armenia should reach the annual 5% growth and more.

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