Monday, March 1 2021 10:44
Karine Melikyan

WB forecast: Armenia`s GDP in 2021 will reach 3.1% growth,  accelerating to 4.5% in 2022

WB forecast: Armenia`s GDP in 2021 will reach 3.1% growth,  accelerating to 4.5% in 2022

ArmInfo.The World Bank (WB) predicted 3.1% GDP growth in Armenia for 2021 with an acceleration in 2022 to 4.5%, against an actual decline of 7.6% in 2020 (with a  projected 8%). This is stated in the new WB report "Global Economic   Prospects", which contains forecasts for 2021-2022.

GDP of neighboring countries will also grow. In the new forecast, the   WB also improved expectations for the runway of the neighboring   countries with Armenia: in Georgia - growth by 4% in 2021 will  accelerate in 2022 to 6% (against the actual decline in 2020 by  6.1%); in Azerbaijan - growth by 1.9% in 2021 will accelerate in 2022  to 4.5% (against the actual decline in 2020 by 4.3%); Turkey - growth   of 4.5% in 2021 will accelerate in 2022 to 5% (against an estimated   positive 0.5% in 2020).

Kyrgyzstan and Armenia will differ in GDP growth in the EAEU

According to a new WB report, in the EAEU countries, GDP expectations   for 2021 have also improved towards growth, except for Belarus,   whose economy is expected to deepen to 2.7% with a weak 0.9% growth  in 2022.

In particular, Russia's GDP is projected to grow by 2.6% in 2021 with  an acceleration in 2022 to 3% (against an actual 3.1% decline in  2020), Kazakhstan - by 2.5% with an acceleration in 2022 to 3%. , 5%   (against the Actual 2.6% decline in 2020), in Kyrgyzstan - by 3.8%  with an acceleration in 2022 to 4.5% (against the actual 8.6% decline  in 2020). And on the second line, after Kyrgyzstan, according to the  GDP growth projected for 2021 among the EAEU countries, Armenia  appears - 3.1%, but according to the forecast for 2022 they share the  first place with the same 4.5% GDP growth.

The world economy in the forecast of the WB does not look better

Growth in the global economy, according to the new forecast of the   World Bank, will amount to 4% in 2021 with a slowdown in 2022 to   3.8% (against the estimated negative 4.3% in 2020), and in the   region of Europe and Central Asia - 3.3% from acceleration in 2022  to 3.9% (against the estimated minus 2.9% in 2020). The US economy  will grow by 3.5% in 2021 with a slowdown in 2022 to 3.3% (against   the actual 3.5% decline in 2020), the Eurozone - by 3.6% growth with   an acceleration in 2022 up to 4% (versus estimated minus 7.4% in  2020), Japan - by 2.5% growth with a slowdown in 2022 to 2.3% (versus   estimated minus 5.3% in 2020), and China's GDP will accelerate   growth to 7.9% (from an actual 2.3% in 2020) with a slowdown in 2022   to 5.2%.

WB President specifies economic prospects:

“Following the devastating COVID-19 health and economic crisis, the  global economy appears to be emerging from one of its deepest  recessions and embarking on a restrained recovery. Beyond the  short-term economic outlook, this report makes it clear that  policymakers are facing huge difficulties - in health, debt   management, fiscal policy. And central bank policies and ongoing  structural reforms are trying to ensure that this still fragile  global recovery picks up steam and sets the stage for sustainable  growth and development over the long term, "said the President of the  World Bank David Malpass.

He stressed that governments and businesses must all embrace the   changed economic landscape. Protecting the most vulnerable will   require successful policies that allow capital, labor, skills and   innovation to shift towards new targets to create a greener and   stronger economic environment after the coronavirus. Some countries   already moving towards this type of dynamism and resilience will have to redouble their efforts. For the rest, the changes are especially important now, when financial positions are severely stretched by the pandemic, and other drivers of long-term growth have weakened.

Noticing that investment collapsed in 2020 in many emerging market   and developing countries after a decade of weakness, D. Malpass   predicted a resumption of investment growth in 2021.  At the same  time, he noted that the experience of past crises raises another  concern - without an urgent correction of the exchange rate, the  weakness of investments will persist for many years.  “To counter the   investment headwind requires significant efforts to improve the  business environment, increase labor and product market flexibility,  and enhance transparency and governance.

Even before the pandemic, already at record levels, both domestic and   foreign debt burdens have become much heavier due to devastating   income cuts in emerging and developing economies. Addressing the  external debt burden requires a comprehensive set of policy measures:  increased participation of all private and official bilateral  creditors in debt relief efforts; deep debt reduction in countries in  debt distress; Debt transparency practices to overcome limitations in  debt contracts; legislative reforms to accelerate private sector debt  restructuring; and a clearer sequence of these processes, "- he  explained.

D. Malpass clarified that the problem of debt sustainability is   complicated by the possible weighting of the already high public   debt with contingent liabilities from growing private debt. “During  the pandemic, many governments supported lending to firms to address  liquidity constraints, including loan guarantees, payment moratoriums   and regulations.

As the health and economic crisis eases, these policies need to be  periodically reviewed to ensure transparency in asset quality and  avoid undermining bank capitalization. Policymakers also need to  strengthen supervisory assessments of loan quality and improve debt  settlement and collection regimes to address potential problems  associated with rising corporate debt levels. With a rise in NPLs,   faster bankruptcy and domestic debt resolution processes will be   essential to freeing assets from litigation and repurposing them for  new purposes. Adding new investment to existing productive assets  will be vital to sustainable development, ”he said.

With regard to growing climate and environmental issues, he noted   that this reinforces the need for policy action. “Investing in green   economy projects, phasing out fossil fuel subsidies and providing   incentives for sustainable technologies can support long-term  growth, reduce carbon emissions, create jobs and help adapt to the  effects of climate change.

Making the right investments is now vital, both to support economic  recovery and to bolster sustainable growth. The correct response to  the pandemic crisis will determine the common future for many years  to come. and will lay the foundations for a strong, fair and  sustainable global economy, "said D. Malpass.  Note that according to  forecasts of the Central Bank of Armenia for 2021, GDP growth will be  2%.  The state budget of the country for 2021 is based on GDP growth  of 3.2% and inflation of 1.5% (+/- 4%).  According to the Statistical  Committee of the Republic of Armenia, in 2020, Armenia's GDP   decreased by 7.6% (against 7.6% growth in 2019), against the   background of a decline in exports and imports by 3.9% and 17.7%,  respectively. Of the sectors of the economy, only the energy complex  and the agricultural sector showed growth - a scanty 1.2 and 1.4%,  respectively, and the rest fell into recession, and in the deepest -   the service sector and the trade sector - 14.7 and 14%. Consumer  inflation in 2020 was 3.7% (versus 0.7% in 2019).


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Government Bonds

Issue volume

10 billion

Volume of T-bills for placement

200 million

Volume of submitted competitive applications

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Volume of satisfied bids

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Yield at cut-off price

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Maximum yield

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Мinimum yield

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Weighted average yield

 5.8314%

Number of participants

2

The maturity date of T-bills

03.02.2020

ArmEx

 

СПРОС (Покупка)

USD

Средневзв. Цена

482,00

ПРЕДЛОЖЕНИЕ (Продажа)

  USD

Средневзв. Цена

-

СДЕЛКИ

USD

Цена откр.

482,00

Цена закр.

482,00

Мин. Цена

482,00

Макс. Цена

482,00

Ср/взв. Цена

482,00

-0.16

Кол-во сделок

1

Объем (инвал.)

200 000

0бъем (драм)

96 400 000