ArmInfo.A more impressive decline in imports than exports reduced Armenia's foreign trade deficit in the first half of 2020 by 20.1% per annum. At the same time, in June alone, the decline in this indicator accelerated to 54% from 23.1% in May, against the backdrop of a slowdown in export growth and accelerated import growth. And in June 2020, compared to June 2019, the foreign trade deficit decreased by 34.2% as a result of a significant decline in imports with a negligible decline in exports.
According to the preliminary data of the RA Statistical Committee, Armenia's foreign trade turnover in the first half of 2020 turned towards a decline of 10.7% from 0.1% growth a year earlier, which is due to the acceleration of the y-o-y decline in exports from 0.5% to 6.5% and a reversal of the dynamics of imports from 0.5% growth towards a 12.9% decline. As a result, Armenia's foreign trade turnover amounted to 1514.1 billion drams ($ 3134.2 million), in particular, exports - 535.6 billion drams ($ 1108.7 million), imports - 978.5 billion drams ($ 2025.5 million), which formed a foreign trade deficit at 442.9 billion drams ($ 916.8 million).
In June 2020 alone, foreign trade turnover slowed down to 13.7% from 15.2% in May due to a significant slowdown in export growth from 31.2% to 14.7%, with a tangible acceleration in import growth from 7.3% to 13. 1%. As a result, Armenia's foreign trade deficit amounted to 68.3 billion drams ($ 141.8 million) in June 2020, this time decreasing impressively (by 54%) against growth in the same month of 2019 (by 14.1%). A year earlier, in June 2019, foreign trade turnover grew by 5.5% due to the upward dynamics of both imports (7.5%) and exports (1.6%).
In y-o-y terms (June 2020 versus June 2019), the decline in foreign trade turnover by 10.2% was to a greater extent provoked by a decline in imports by 15.2% than in exports by 0.5%. A year earlier, in June 2019 to June 2018, both import and export were in growth - 8.4% and 1.2%, respectively, which kept the foreign trade turnover in growth by 5.9%.
According to statistics, the economic activity of Armenia in the first half of 2020 decreased by 4.7% per annum, against growth by 6.5% in the same period of 2019. In June 2020 alone, economic activity increased by 14.8%, after growing by 13.3% in May and against growth by 8.2% in June 2019. In y-o-y terms (June 2020 to June 2019), economic activity decreased by 7.5% (against an increase of 3.4% in June 2019 to June 2018).
To note, the World Bank (WB) in June updated its forecast for Armenia's GDP for 2020, expecting a decline of 2.8% (against the previously predicted slowdown in growth to 1.7%). There are no recent WB forecasts for Armenia's foreign trade yet, but in the May forecast for 2020, a decline of 1.5% and 2.6%, respectively, was already expected for exports and imports. In its April forecast, the IMF expected a 1.5% decline in GDP for Armenia in 2020, but the revision of forecasts in the direction of a greater deterioration in the global economy and Russia's GDP in June foreshadows a deepening decline in Armenia's GDP. According to the forecasts of the RA Government for 2020, the GDP decline will be 2%. The new forecast of the Central Bank of Armenia for 2020 (June) has been revised towards a 4% decline in GDP (against an actual 7.6% growth in 2019), and a 15-17% decline in imports is expected in foreign trade (against an actual growth in 2019. by 9.1%) and exports - by 12-15% (against actual growth in 2019 by 10.3%).
To recall, in Armenia since March 16, in connection with the coronavirus pandemic, a State of Emergency has been introduced, which is extended for the fourth time - now until August 13. As part of measures to prevent the spread of the pandemic, a temporary ban was imposed on many activities in the first month of the emergency (including restaurants, cafes, bars, casinos, hotels, canteens, shopping facilities and industries not related to food and medical products). As part of the ban, the work of public transport (including the metro) was suspended in the republic and the movement of other vehicles (except for taxis) was limited, international aviation, rail and bus services were limited. The ban was partially lifted in the second half of April, then from May 4, the list of permitted types of economic activity was further expanded in order to ensure the vital activity of the economy, and from May 18 the ban was lifted almost completely. From the same day, public transport (including the metro) and many public catering and services facilities began to work, but so far the activities of international air, rail, and bus communication have been limited.
