Monday, May 23 2022 15:24
Karine Melikyan

Armenia`s GDP growth in Q1 2022 exceeded pre-Covid rates by 8.6% per  annum 

Armenia`s GDP growth in Q1 2022 exceeded pre-Covid rates by 8.6% per  annum 

ArmInfo.Armenia's GDP grew by 8.6% per annum in Q1 2022  from a 3.3% decline in the same period of 2021, thereby exceeding the 7.5% growth of the comparable pre- Covid period (Q1 2019), reaching 1.5 trillion drams ($3.1 billion).

The GDP deflator index in Q1 2022 compared to the same period a year ago  increased to 106.9% from 104.7% in Q1 2021, while more noticeably  exceeding the pre-Covid indicator of Q1 2019 at 103.8%. This is  evidenced by the data of the RA Statistical Committee published on  May 23.

In Q1 2022, the dynamics of GDP, as in previous years, was negative -  recording a 36% decline against a 34.8% decline in the Q1 2021 and a  13.3% growth in Q4 2021. As a comparison, we note that in pre-Covid  2019, the quarterly dynamics of GDP in this period was also negative  with an almost similar pace of 36.2%.

YOY GDP growth in Q1 2022 was mainly from the service sector - by  22.2%, the energy complex - by 16.7%, and to a slightly lesser extent  from the trade sector - by 7.6% and the construction sector - by 6  .2%.  Against this background, the growth of the industrial sector by  3.1% looked more modest. And only the agricultural sector was in  decline - by 5.4%. In pre-Covid 2019, in the first quarter, the  largest y-o-y growth was also shown by the service sector - by 17.3%,  followed by the construction sector - by 10.8%, the trade sector - by  10.1% and the industrial sector - by 2%, and the energy complex and  the agricultural sector were in decline - by 14% and 0.2%  respectively. And in Q1 2021, , only the construction sector showed  y-y growth - by 4.7% and the energy complex - by 1.4%, while other  industries were in decline: the service sector - by 8.1%, the trade  sector - by 5.6%, the industrial sector - by 3.9%, the agricultural  sector - by 1%.  At the same time, Armenia's foreign trade turnover  reversed its y-o-y dynamics from a 4.4% decline in Q1 2021 towards a  38.5% growth in Q1 2022. 

In its structure, the volume of exports accelerated y-o-y growth from  3.4% to 26.9%, when the import trend increased by 45.6% from a  decline of 8.7%:. In pre-Covid 2019, in the first quarter, these  indicators were in decline: foreign trade turnover - by 5%, in  particular, exports - by 8.6% and imports - by 3.1%.  

It should be noted that according to the May forecast of the  International Monetary Fund, Armenia's GDP growth in 2022 will slow  down to 1.5%, mainly due to lower consumption and reduced trade.   According to the April forecast of the World Bank, Armenia's GDP  growth in 2022 will slow down to 1.2%, and the World Bank calls for  strengthening macroeconomic policy buffers. And the March forecast of  the Central Bank of the Republic of Armenia forecasts a slowdown in  the country's GDP growth to 1.6%, in connection with the growth of  geopolitical risks in the region and the general uncertainty  associated with the Russian- Ukrainian military-political conflict  and the unprecedented sanctions applied by the West against Russia.  

According to the RA Statistical Committee, Armenia's GDP in 2021  reached a 5.7% growth from a 7.4% decline in 2020, against the  pre-Covid 7.6% growth in 2019. (The average settlement rate of the  dram in January-March 2022 was 486.40 AMD/$1). 

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