ArmInfo. The model of Armenia's economic development has completely exhausted itself, said during the presentation, published on June 15 of the World Bank (WB) report "System Assessment of Armenia. Results. Future of Armenia" Program Manager of the WB of the South Caucasus, Europe and Central Asia Genevieve Boyreau. She justified her assessment with a significant increase in the country's socially vulnerable population at the expense of the middle strata.
According to her, today Armenia needs economic reforms, otherwise the state will provide "modest" GDP per capita. "Armenia faces two main systemic challenges: aging and population decline, as well as climate changes that will negatively affect economic growth if economic policy reforms are not carried out," she said. According to the WB expert group, a balanced growth of global relations is envisaged in the new model for the development of the Armenian economy, in particular, through the expansion of trade and investment, a transition from illiquid to liquid goods and services is necessary; The formation of a dynamic, efficient and competitive business environment that creates jobs. It is necessary to achieve an increase in labor productivity and provide flexibility to the new model, which will be hardy before climate change.
In particular, speaking about competitive environment, the expert noted that during the last years certain steps were taken in this direction, but they are clearly not enough for profound changes in the legal framework, and financial accessibility still remains a key obstacle to the development of the private sector. According to the data of 2013, only 3% of Armenian entrepreneurs had access to credit resources and other financial sources, while this figure in the countries of Europe and Central Asia is approaching 49%. At the same time, 75% of representatives of big business in Armenia have credit obligations in banks, whereas small entrepreneurs accounted for only 31%. According to her, the problem of entering the market for new participants, the difficulties with the growth of small enterprises, the lack of a competitive field between manufacturers, the lack of transparency in matters of state assistance and the availability of fair competition with participation in public procurement still remain the actual problems. To improve the business environment, the WB experts insist on simplifying, as far as possible, financial accessibility, expanding access to innovations, improving the corporate governance system, strengthening the effectiveness of competition legislation, strengthening the profit distribution environment, forming modern agriculture, eliminating gaps that impede the improvement of the investment environment.
According to WB experts, when carrying out economic reform, GDP per capita until 2020 will remain at the same actual level of $ 4 thousand, with a tendency to increase in 2030 to 6 thousand, and in 2050 experts provide per capita GDP exceeding $ 12 thousand, while, according to the actual scenario, this figure will not exceed $ 8 thousand.
By the reformation scenario, the poverty will reduce from current 30$ to 25% by 2020, 10% by 2030, and by 2050 - 0.2-0.3%. If the reforms are not carried out, WB experts predict poverty in Armenia in 2050 at the level of 7-8%.
Speaking about Direct Foreign Investments, WB expert noted that in the period of 2012-2015, the share of DFI in GDP was 3.7-3.8%, while in the period of 2005-2008 it was 7.2%. Boyreau noted that there are 9-11 million Armenians in the world and the potential of Diaspora is not used effectively.
According to National Statistical Service of Armenia, in the first quarter of 2017, the GDP per capita grew by 8.7% per annum to 325727 AMD ($671/629 EUR). According to IMF, in the rating of states by GDP in 2016, Armenia occupied 115 position ($3511),
To recall, the World Bank (WB) predicts GDP growth in Armenia in 2017 by 2.7% with the acceleration of the rate in 2018 to 3.1%, in 2019 - up to 3.4%. The state budget of Armenia for 2017 laid the GDP growth by 3.2%. According to the updated forecast of the Central Bank of Armenia, GDP growth in Armenia in 2017 will be 3.2-4.4%, according to the IMF forecast of 2.9%, according to Fitch forecast - 2.1%, EDB - 2.9% and Asian Development Bank - 2 , 2%.