ArmInfo.In Q1 2022, the inflow of transfers from individuals to Armenia increased by 38.2% per annum or by $155 million, reaching $561 million, Deputy Executive Director of the Union of Banks of Armenia Arman Sargsyan said during a press conference on May 13.
At the same time, the lion's share traditionally falls on the Russian market (42.6%), followed by the United States (25.5%). Very small volumes of transfers come from France, Germany, Kazakhstan, UAE, Ukraine, Spain, China.
The outflow of remittances from Armenia increased by 35% or $97 million in y-o-y terms, amounting to $374 million. Moreover, transfers were mainly directed to Russia (33.2%) and the USA (16.3%), as well as to the UAE (6.4%), China (4%), Germany (2.9%), and to a lesser extent to France, Spain, Ukraine, Kazakhstan. As a result, the net inflow of transfers, having increased by 45% or $58 million year-on-year, reached $187 million in Q1 2022.
In Q1 2021, both the inflow and outflow of private transfers also showed growth, but much more modest - 14.7% and 4% per annum, respectively, as a result of which the net inflow has registered a 48% increase. The share of Russia in the inflow then decreased to 38% (from 46.5% a year earlier), while the United States, on the contrary, increased to 29.1% (from 17.8% a year earlier), which was also observed in the outflow - a decrease in the share of Russia to 31.1% with an increase in the US share to 16% from 32.6% and 13%, respectively, a year earlier. According to the March forecast of the Central Bank of the Republic of Armenia for 2022, the net inflow of remittances in dollar terms will decrease by 20% to 6.7% of GDP. It should be noted that the Armenian economy is gradually reducing its high dependence on the "transfer needle". According to the analysts of AmRating CRA, in the current conditions of aggravation of the external background and sanctions against the Russian Federation, a possible reduction in remittances from Russia will have little effect on the decline in domestic demand due to the structure of transfers that has changed in recent years. Thus, over the past few years, the share of transfers in the formation of the country's GDP has decreased from 14% to 8.9% by 2022. The geographical structure of private transfers has also changed: the share of transfers from Russia in the total volume has decreased in recent years from 75% to 41% by 2022.
At the same time, as the agency's analysts noted, the reduction in private transfers can be fully compensated not by the seasonal, as it was before, but by the constant, all-season, significant increase in "immigration" and tourist flow to the country, including from Russia, citizens of which, due to Western sanctions, will be limited in the choice of inexpensive places for recreation and remote work, one of the comfortable destinations of which is Armenia.
