Tuesday, June 9 2020 12:38
Karine Melikyan

In Armenia, economic activity decreased by 1.7% per annum by May 2020

In Armenia, economic activity decreased by 1.7% per annum by May 2020

ArmInfo.  In Armenia, economic  activity in January-April 2020 fell by 1.7% per annum (against 7%  growth a year earlier), against the backdrop of a decline in exports  and imports by 8.1% and 11.5%, respectively. According to the final  data of the Statistical Committee of the Republic of Armenia, the  industrial sector, the services sector and the energy sector  demonstrated growth while, the trade and construction sectors were in  decline, and the data on the agricultural sector are published in the  statistical report only quarterly.

Thus, in January-April 2020, the industrial sector slowed down y-o-y  growth from 4.5% to 4.2%, the service sector slowed down growth from  17% to stagnant 0.1%, and the energy complex from the 9.2% decline  registered 10 3% growth. The trading sector and the construction  sector worsened the annual dynamics with the vector turning from  ascending 9.8% and 8% to the downward, respectively, by 8.6% and  21.9%.

In April 2020, compared to April 2019, economic activity decreased by  17.2%, against an increase of 9.2% in April 2019 compared to April  2018. And in April 2020 alone, economic activity decreased by 13.5%,  against a decline of 0.3% in April 2019.

The industrial production price index increased in January-April 2020  compared to the same period in 2019 by 0.1%, in April 2020 compared  with April 2019 - by 0.8%, and in April 2020 alone it decreased by  1.2%.  A year earlier, a similar dynamics was observed in the  industrial products price index: in January-April 2019 compared to  the same period in 2018 - an increase of 0.4%, in April 2019 compared  to April 2018 - an increase of 0.6%, and in April 2019 alone- a  decline of 3.5%.

In the monthly terms (April 2020), all industries were in decline:  construction - 40.6%, trade - 29.4%, services - 11.2%, industrial  sector - 9.2% and energy sector - 5.6%. Moreover, four of them are  accelerating downward, as evidenced by a comparison with last year's  April dynamics. So, a year earlier, in April 2019, growth was  recorded only in the services sector - by 0.5%, and other sectors  remained in decline:  construction - by 10.8%, energy complex - by  3.3%, industry - by 3% and trade - by 1.8%.

In y-o-y terms (April 2020 to April 2019), there was also a decline  in all sectors: construction - 51%, trade - 33.1%, services - 15.9%,  industrial sector - 8.6% and energy sector - 3.3% . A year earlier,  in April 2019 compared to April 2018, these areas were growing: the  services sector - 16.2%, the industrial sector - 13.2%, trade - 9%,  the energy complex - 8.9% and the construction sector - 1.8%.

According to statistical data, in January-April 2020, the trade  sector holds the leadership in absolute terms with the volume of  816.1 billion drams ($ 1.7 billion). The services sector is on the  second place, 585.4 billion drams ($ 1.210 billion), the industrial  sector is the third - 585.2 billion ($ 1.209 billion), and the  construction sector was on the fourth place, due to the lack of data  on the agricultural sector - 54.03 billion drams ($ 111.7 million).  The volume of electricity generation in January-April 2020 amounted  to 2670.7 million kWh, of which in April alone- 587.4 million kWh.

At the same time, the foreign trade turnover of Armenia in  January-April 2020 amounted to 974.2 billion drams ($ 2015.9 million)  with an acceleration of the y-o-y decline to 10.4%. In its structure,  exports lagged in decline - 8.1% to 334.6 billion drams ($ 692.5  million) and imports - 11.5% to 639.6 billion drams ($ 1323.4  million). In April 2020 alone, foreign trade turnover decreased by  15.3%, due to almost the same decline in exports and imports - by  15.5% and 15.2%, respectively, and compared with April 2019, a  decrease in foreign trade turnover by 28.4% was caused by decline of  exports by 30.3% and imports by 27.4%. A year earlier, in  January-April 2019, the foreign trade turnover of Armenia decreased  by 4.2% per annum, in particular, exports - by 8.6% and imports - by  1.9%, in April 2019 alone the growth of foreign trade turnover by  25.8% was triggered by the growth of exports by 21% and imports by  28.2%, compared with April 2018, these indicators were in growth -  15.9%, 9.9% and 18.9%, respectively.

The average settlement rate of dram in April 2020 was 488.66 AMD/ $  1, and in January-April 2020 - 483.90 AMD / $ 1, against 484.29 AMD /  $ 1 - in April 2019 and 486.49 AMD / $ 1 - in January-April 2019.

According to new (June) forecasts of the World Bank, the decline in  Armenia's GDP in 2020 will be 2.8%.  In terms of Armenia's foreign  trade, the WB in the previous forecast (May) expected for 2020 a  decline in exports and imports by 1.5% and 2.6%, respectively. In its  April forecast, the IMF expected a 1.5% drop in GDP in Armenia for  2020. According to the forecasts of the RA Government for 2020, the  decline in GDP will be 2%. The forecast of the Central Bank of the  Republic of Armenia (March) portends a slowdown in GDP growth in 2020  to a stagnant 0.7% (from the actual 7.6% growth in 2019). 

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