Thursday, August 17 2017 17:03
Emmanuil Mkrtchyan

EDB: Support for the growth rates of economic activity and GDP in Armenia will be low base of previous year

EDB: Support for the growth rates of economic activity and GDP in  Armenia will be low base of previous year

ArmInfo. The growth of index  of economic activity of Armenia in June 2017 remained at a high level  and amounted to 5.1% by June 2016. The increase in industrial  production in June slowed to 3.8% y / y after a surge in the previous  month by 20% y / In The dynamics of agricultural output in June  reached a positive level (an increase of 3.4% y / y), partly due to  the low base of the previous year. Negative rates of growth remained  in construction (-4.4% y / y). Such data on Armenia's economy are  contained in the July macroeconomic review of the Eurasian  Development Bank (EDB) for EDB member countries.

It is noted that in the second half of 2017, in addition to the  recovery dynamics of consumer activity, support for the growth rates  of the economic activity and GDP index of Armenia as a whole will be  supported by the low base of the previous year. Against this  background, GDP growth is expected to grow at the level of 5.4% in  2017. Increase in retail trade turnover in June slowed slightly to  3.5% y / y after growing by 9% and 9.5% y / y in previous months,  which may partly be due to a slowdown in the growth of remittances in  June.

Negative balance of foreign trade balance in the first half of 2017  on 30% (USD 190 million) exceeded the level of the same period of the  previous year. In June, the growth of imports of goods (29% y / y)  was preserved in comparison with exports (19% y / y) versus the  background of consumer demand recovery.  One of the main directions  for expanding exports is Russia (an increase of 27.1% y / y in  January-June), facilitated by the recovery of economic activity in  Russia and the dynamics of the exchange rate (weakening of the  nominal exchange rate of the dram to the Russian ruble in  January-June 2017 By 21.3% compared to January-June 2016).

Annual inflation in June remained in the area of positive indicators  and amounted to 1.1%. Against the backdrop of a recovery in economic  activity and an increase in the inflationary impact of domestic  demand, inflation will gradually recover and at the end of 2017 we  are expected to reach 2.3%.

Remained dynamics of remittance volumes are preserved. Support for  domestic demand and economic activity in general continues to be the  growth of remittances from abroad. According to the Central Bank of  Armenia, the positive growth in remittances of individuals in dollar  terms increased in June 2017 by 9.1% yoy, while the increase in money  transfers from Russia amounted to 8.9% yoy. The surplus of the state  budget in June amounted to 1.7 billion drams. In January-June, the  deficit decreased more than twofold compared to the same period in  2016 and amounted to 38.3 billion drams. According to the budget  rule, in 2017, the budget deficit should not exceed 152 billion  drams. The growth of budget revenues for January- June 2017 amounted  to 6.3% yoy, while expenses fell by 1.8% yoy.

The macroeconomic round-up section is noted that despite the positive  dynamics of the first half of the year in the field of economic  recovery of the countries participating in the Eurasian Development  Bank (EDB), which continued in June, in most countries of the region,  risks for these positive trends have been outlined.  The report  emphasizes that against the background of the depreciation of  exchange rates and the growth of inflationary pressure, central banks  (except the National Bank of the Republic of Belarus) suspended the  reduction of the key rate by July, which was accompanied by a  tightening of the rhetoric of regulators. In addition to reducing the  possible scale of stimulating economic activity by lowering interest  rates, in most EDB countries in the first half of the year a  significant reduction in the budget deficit was registered, which is  partly dictated by the need to reduce the vulnerability of state  budgets in relation to commodity price volatility or the desire to  prevent high public debt growth. With the reduction of monetary and  budgetary incentives, the prospects for further recovery of EDB  countries will largely depend on structural measures to increase  investment growth and increase exports. "However, in these segments  of the economy there are challenges - after restoring the growth of  mutual trade and exports, further recovery dynamics of exports  without support from commodity prices may prove more difficult,  especially after the period of recovery of exchange rates of  currencies and real wages," noted the chief Economist of the EDB  Yaroslav Lissovolik.

The Eurasian Development Bank (EDB) is an international financial  organization established by Russia and Kazakhstan in January 2006 to  promote the development of the market economy of the participating  countries, their sustainable economic growth and the expansion of  mutual trade and economic ties. The authorized capital of the EDB is  7 billion USD. The Member States of the Bank are the Republic of  Armenia, the Republic of Belarus, the Republic of Kazakhstan, the  Kyrgyz Republic, the Russian Federation and the Republic of  Tajikistan.

POST A COMMENT
Input digits     


News
ADB signed sale and purchase agreement with Bank of Georgia in  respect of its shares in AmeriabankADB signed sale and purchase agreement with Bank of Georgia in  respect of its shares in Ameriabank
Founder of ABBYY Group, David Yang, to Speak at Armenia`s First  Investment and Financial ForumFounder of ABBYY Group, David Yang, to Speak at Armenia`s First  Investment and Financial Forum
Armenia`s economic activity increased by 10.7% per annum in Jan 2024Armenia`s economic activity increased by 10.7% per annum in Jan 2024
Gevorg Mantashyan: High-Tech Ministry makes consistent efforts for  emergence and progress of startups in ArmeniaGevorg Mantashyan: High-Tech Ministry makes consistent efforts for  emergence and progress of startups in Armenia
S&P affirms Armenia`s sovereign rating at `BB`; Outlook Stable,  projectting GDP growth of 6.2% in 2024 S&P affirms Armenia`s sovereign rating at `BB`; Outlook Stable,  projectting GDP growth of 6.2% in 2024
Food Safety Inspectorate  did not reveal any violations at Jermuk  Group enterprise after inspectionFood Safety Inspectorate  did not reveal any violations at Jermuk  Group enterprise after inspection
Erik Tintrup: Germany will continue to assist Armenia in tourism  developmentErik Tintrup: Germany will continue to assist Armenia in tourism  development
Privileged conditions with the Business Prime packagePrivileged conditions with the Business Prime package
Armenia`s government to establish G Solution organization using  facilities of Ministry of Finance, State Revenue CommitteeArmenia`s government to establish G Solution organization using  facilities of Ministry of Finance, State Revenue Committee
Armenia ideally positioned to offer India alternative sea trade  route, especially with Europe - Armenian minister Armenia ideally positioned to offer India alternative sea trade  route, especially with Europe - Armenian minister 
Armenia`s government kept election pledge -premier Armenia`s government kept election pledge -premier 
Armenia`s authorities suspend taxation of labor migrants Armenia`s authorities suspend taxation of labor migrants 
Motor Insurers` Bureau informs about need to indicate bank account  number in CMTPL agreements from April 1, 2024; what foreigners should  do not yet reportedMotor Insurers` Bureau informs about need to indicate bank account  number in CMTPL agreements from April 1, 2024; what foreigners should  do not yet reported
In terms of GDP per capita, Armenia is in first place in South  Caucasus - Pashinyan In terms of GDP per capita, Armenia is in first place in South  Caucasus - Pashinyan
Russia ready to develop technological cooperation with Armenia -  ambassador Russia ready to develop technological cooperation with Armenia -  ambassador 
Team Telecom Armenia announces sale of eSIM cards Team Telecom Armenia announces sale of eSIM cards 
Ria Money Transfer has recognized Ardshinbank Partner of the YearRia Money Transfer has recognized Ardshinbank Partner of the Year
Tourism Committee, SDA to cooperate in tourism development in Lori,  Tavush, Vaiots Dzor, Syunik Tourism Committee, SDA to cooperate in tourism development in Lori,  Tavush, Vaiots Dzor, Syunik 
Armenian authorities` GDP forecasts for 2024 seem overstated - expert Armenian authorities` GDP forecasts for 2024 seem overstated - expert 
Expert on Armenia`s international trade growth against Expert on Armenia`s international trade growth against "miserable  trade pattern"  
Tatul Manaseryan: In case of utilization of competitive advantages,  Armenia`s business activity growth could be within 7-8% by end of  2024Tatul Manaseryan: In case of utilization of competitive advantages,  Armenia`s business activity growth could be within 7-8% by end of  2024
Rustam Badasyan: until issue of taxation of labor migrants is finally  resolved, no coercive measures will be usedRustam Badasyan: until issue of taxation of labor migrants is finally  resolved, no coercive measures will be used
Armenia`s GDP growth slowed to 8.7% in 2023Armenia`s GDP growth slowed to 8.7% in 2023
UBA Head: Armenian banking system RoE became comparable to countries  with similar economiesUBA Head: Armenian banking system RoE became comparable to countries  with similar economies
Decision that was made in 10 days - UBA chairman on HSBC Bank`s exit  from ArmeniaDecision that was made in 10 days - UBA chairman on HSBC Bank`s exit  from Armenia
Daniel Azatyan: in Armenia, highest lending growth was registered in  construction sector, with decrease in industrial sector Daniel Azatyan: in Armenia, highest lending growth was registered in  construction sector, with decrease in industrial sector 
Entry of bank with international brand into financial market of  Armenia always desirable and important - UBA chairmanEntry of bank with international brand into financial market of  Armenia always desirable and important - UBA chairman
Armenia`s commercial banks to be authorized to issue guarantees for  participation of Armenian companies in procurement in EAEUArmenia`s commercial banks to be authorized to issue guarantees for  participation of Armenian companies in procurement in EAEU
Net inflow of transfers to Armenia decreased by 36% in 2023Net inflow of transfers to Armenia decreased by 36% in 2023
Economist: Outflow of remittances from Armenia to continue to grow in  2024Economist: Outflow of remittances from Armenia to continue to grow in  2024
Transavia to start operating flights on route Lyon - Yerevan - Lyon Transavia to start operating flights on route Lyon - Yerevan - Lyon 
Ameriabank set to join BOGG, a London Stock Exchange (LSE) listed financial group as a standalone entityAmeriabank set to join BOGG, a London Stock Exchange (LSE) listed financial group as a standalone entity
Bank of Georgia announces proposed acquisition of Ameriabank for  $303.6 millionBank of Georgia announces proposed acquisition of Ameriabank for  $303.6 million
Former MP on economic situation in Armenia: Former MP on economic situation in Armenia: "What is brought by water  will go with water"
Armenia, Iran discuss possibilities of strengthening logistics ties  between  two countriesArmenia, Iran discuss possibilities of strengthening logistics ties  between  two countries
Which Book to Choose as a Gift for the Book Giving Day? A Piece of Advice from Idram and IDBankWhich Book to Choose as a Gift for the Book Giving Day? A Piece of Advice from Idram and IDBank
SRC: individuals-residents of Armenia must pay tax on income received  abroadSRC: individuals-residents of Armenia must pay tax on income received  abroad
Expert: SRC should have taxed labor migrants only after large-scale  information campaign for them, which was not doneExpert: SRC should have taxed labor migrants only after large-scale  information campaign for them, which was not done
Global economic growth to slow -EDBGlobal economic growth to slow -EDB
EDB expects fiscal policy to stimulate Armenian economy in 2024 EDB expects fiscal policy to stimulate Armenian economy in 2024 
Armenian Card: arca.am application to stop operating from Apr 15,  2024Armenian Card: arca.am application to stop operating from Apr 15,  2024
Bank of Georgia Group PLC announces possible transaction to acquire  Ameriabank CJSCBank of Georgia Group PLC announces possible transaction to acquire  Ameriabank CJSC
Armenian insurance sector profit decreased by 33% in 2023Armenian insurance sector profit decreased by 33% in 2023
With HSBC`s withdrawal, Armenia loses last transnational  institutional investor - analystsWith HSBC`s withdrawal, Armenia loses last transnational  institutional investor - analysts
Armenia amends Gyumri Urban Roads Project agreement with EBRDArmenia amends Gyumri Urban Roads Project agreement with EBRD
Moody`s assigns B2 rating to Electric Networks of ArmeniaMoody`s assigns B2 rating to Electric Networks of Armenia
Electric Networks of Armenia CJSC bonds successfully placed Electric Networks of Armenia CJSC bonds successfully placed 
Food Safety Inspection Authority of Armenia responds to  Rospotrebnadzor`s decision to suspended sale of Jermuk mineral waterFood Safety Inspection Authority of Armenia responds to  Rospotrebnadzor`s decision to suspended sale of Jermuk mineral water
Within year, TUMO Center for Creative Technologies to open in Los  AngelesWithin year, TUMO Center for Creative Technologies to open in Los  Angeles
S&P Global Ratings upgrades Ardshinbank to `BB-`; outlook S&P Global Ratings upgrades Ardshinbank to `BB-`; outlook "Stable"
Ministry of Economy: Armenia almost doubled industrial and natural  diamonds` export in 2023Ministry of Economy: Armenia almost doubled industrial and natural  diamonds` export in 2023
How to Celebrate Love Days? A Piece of Advice from Idram and IDBankHow to Celebrate Love Days? A Piece of Advice from Idram and IDBank
Armenian official, ADB reps discuss construction, management projects  Armenian official, ADB reps discuss construction, management projects  
Emphasis in export strategy must be placed on markets not yet open to  us - Armenia`s economy minister Emphasis in export strategy must be placed on markets not yet open to  us - Armenia`s economy minister 
Fitch upgrades ACBA Bank to `BB-`; Outlook stableFitch upgrades ACBA Bank to `BB-`; Outlook stable
EEC: it is necessary to develop the initiative to establish EAEU  trading houses in IranEEC: it is necessary to develop the initiative to establish EAEU  trading houses in Iran
Visa Travel card - your best friend of the roadVisa Travel card - your best friend of the road
Armenia yet to decide on NPP construction companies Armenia yet to decide on NPP construction companies 
Armenia`s authorities trying to solve problem of lack of nuclear  energy personnel Armenia`s authorities trying to solve problem of lack of nuclear  energy personnel 
Impact of re-exports on GDP growth within 1% in 2023Impact of re-exports on GDP growth within 1% in 2023
Read more


Exchange rates
26.02.2024
RUB4.380.03
USD404.420.07
EUR438.630.96
GBP512.600.13
CAD299.17-0.64
JPY26.850.03
CNY56.190.02
CHF459.880.81