ArmInfo.The Central Bank of Armenia forecasts GDP growth for 2019 in the range of 4.6-6.1%. This is set out in the Central Bank's Monetary Policy Program for the Q1 of 2019, published at the end of March.
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The GDP growth expected by the Central Bank in 2019 mainly causes private consumption to increase by 5.1% and private investment by 0.3%. In the medium term, according to the forecasts of the Central Bank of Armenia, the expansion of production capacities, the sequence of structural reforms implemented by the Government and the potential for expected economic growth in the partner countries of Armenia will serve as the main factor of GDP growth.
For imports, the Central Bank predicts an increase of 2-4% for 2019, and 4-6% for exports. According to the expectations of the Central Bank of Armenia, the net inflow of remittances in 2019 will increase by 5- 7%, in line with the predicted development of the Russian economy, from where Armenia receives the dominant volume of private transfers (about 60%).
To note, according to the World Bank's forecast for 2019 updated in March 2019, Armenia's GDP growth will be 4.3%, with acceleration in 2020 to 4.6%. In the state budget of Armenia for 2019, GDP growth of 4.9% is laid. According to the IMF forecast updated in February 2019, Armenia's GDP growth in 2019 will be 4.5%.
According to the Central Bank of Armenia, the inflow of individuals' transfers to Armenia slowed down the growth in 2018 to 1.7% from 14.6% in 2017, making $ 1.786 billion. At the same time, the growth rate of outflow of transfers slowed slightly from 21.2% in 2017 to 20.1% in 2018, reaching $ 1.188 billion. This worsened the dynamics of net inflow of transfers from 7.1% growth in 2017 to 22.1% decline in 2018, forming at the level of $ 597.2 million. In the inflow, Russia's share decreased for 2018 to 58.8% from 60.6% in 2017, and in the outflow, on the contrary, increased to 39.7% from 38% in 2017. The influx of transfers from Russia to Armenia in 2018 turned the trend vector down by 1.4% from 18.7% growth in 2017. At the same time, the increase in money outflow in Russia accelerated in 2018 to 25.4% from 12.8% in 2017. This worsened the dynamics of net inflow of transfers from Russia from a 22.2% growth in 2017 to a 16.1% decline in 2018.
According to the RA Statistical Committee, GDP growth in Armenia slowed down in 2018 to 5.2% from 7.5% in 2017, reaching 6.003 trillion drams ($ 12.4 billion). The GDP deflator index in 2018 was 102.5%, against 102.2% in 2017. The service sector, the commercial sector and the industrial sector retain a dominant value in terms of GDP, but for the y-o-y growth alone the service sector remained in the drivers. In particular, the service sector accelerated growth rates from 14.4% in 2017 to 18.8% in 2018, while the commercial sector, by contrast, slowed growth from 14% to 8.7%. The industrial sector also slowed growth from 12.6% to 4.3%, and the construction sector accelerated growth from 2.2% to 4.5%. The power complex slowed down its growth rate from 6.1% to 0.2%. The agricultural sector, lingering in a downturn, accelerated the pace to 7.6% from 3% in 2017. In 2018, Armenia's foreign trade turnover grew by 16.4%, in particular, exports - by 7.8% and imports - by 21.1%. A year earlier, in 2017, foreign trade turnover increased by 26.9% due to growth in exports by 25.2% and imports by 27.8%.