Tuesday, August 6 2019 14:28

ArmInfo.During 2018, remittances remained of strategic importance for stimulating the  consumer and investment components of domestic demand, as well as for  the balance of payments of Armenia as a whole, compensating for the  significant foreign trade deficit.

This is stated in the report

, prepared by the Center for Integration Studies of the Directorate for  Analytical Work of the EDB.As noted in the report, given the  geographical structure of revenues, private transfers remain an  important integration channel connecting Armenia with the EAEU  countries, mainly Russia, whose share in total revenues in 2018 was  58.8% (60.6% a year earlier).Nevertheless, experts of the Bank note  that it should be noted that the value of remittances for the economy  continues to decline. At the end of 2018, the value of remittances  slightly decreased to 14.4% of GDP from 15.2% of GDP for the same  period of the previous year. In total, $ 1,785.6 million was  attracted in 2018, which is only 1.7% more compared to the same  period in 2017 ($ 1,756.5 million a year earlier).

The dynamics of money transfers from abroad to Armenia slowed down  from quarter to quarter during the year and in the second half of  2018 turned out to be negative (-3.6% YoY in the III quarter and  -2.9% in the IV quarter), which became one of the factors in the  slowdown of Armenia's economic activity over this period.The decrease  in revenues in the second half of the year was caused solely by a  decrease in remittances from Russia (-8.2% y / y in the III quarter  and -12.5% in the IV quarter against the background of an  accelerating growth in remittances from other countries) and is  explained by adverse changes in exchange courses during the period,  as well as internal political processes.An indirect confirmation of  the influence of this factor is a noticeable increase in the outflow  of funds from Armenia, as well as a reaction to the initiative of the  government to introduce taxes on money transfers. The actively  negative position of the population on the possibility of an  additional tax burden led to the fact that the decision on this issue  was postponed.