Armenian government forecasts on economic growth rates are close to  forecasts of CBA

ArmInfo. The forecasts of the Armenian government on economic growth rates are close to the forecasts of the Central Bank of Armenia. On October 28, presenting  the conclusion of the Central Bank on the draft state budget for  2020, said CB Chairman Artur Javadyan.

According to him, next year the process of structural reforms aimed  at increasing productivity will continue. The sector of industry and  services will continue to dominate the basis of GDP growth, due to  which it is envisaged to ensure GDP growth of 4.9%. Higher rates will  be largely due to increased demand in the consumer market and  improved external factors. Moreover, the increase in demand in the  consumer market to be provided due to the growth of revenues in  private companies.

 Investment growth is planned to be provided both at the expense of  state and private injections, which will lead to increased economic  activity. It is expected that next year the trend of reducing  imbalances in foreign trade will continue. Thus, the processes that  began in 2019 will be supported.

Moreover, the increase in demand in the consumer market will,  according to forecasts, be provided due to revenue growth in private  companies.

Most of the state budget expenditures will be aimed at the  implementation of capital expenditures, the share of which in the  country's GDP will increase by 2.2% to 5%. Public investment will  have a significant impact on infrastructure development.

The Head of the Central Bank also said that, according to the  medium-term spending program for 2020- 2023, inflation is projected  at 4% (+ - 1.5%). At present, it amounts to about 1.8%, and there are  practically no inflationary processes in the domestic market.

To recall,, according to the inflation report of the Central Bank of  the Republic of Armenia for the third quarter of 2019, the inflation  rate in Armenia at the end of the year will be lower than the target  mark.  According to the regulator's report, this year a weak  inflationary environment was formed under the influence of a number  of external and internal factors, as a result of which the Central  Bank continued to pursue a restrained monetary policy.

At the same time, the Central Bank believes that low inflation  currently helps to curb long-term inflation expectations and maintain  income solvency. In this regard, the regulator prefers to pursue a  policy aimed at the gradual recovery of inflation. According to  experts of the Central Bank, the main reason for low inflation in the  medium term is mainly the low aggregate demand and the restrained  fiscal policy of the government. According to the state budget of  Armenia, the average annual inflation planned for 2019 is 2.7%.