Vardan Aramyan: With the current quality and level of investments,  there is no need to talk about the growth of the economy`s potential

ArmInfo.With the current quality and level of investment, there is no need to talk about the growth of the economy's potential. Former Minister of Finance of  Armenia Vardan Aramyan expressed a similar opinion in an interview  with the Public Television.

He explained that the modernization of the economy is carried out  through reforms and investments.  Speaking about the latter, Aramyan  noted that at the end of 2022, the real growth in investments  amounted to 5%, and in the context of the last 4 years (excluding  2022), the volume of investments increased by only 3.5%. He drew  attention to the fact that in the context of investments, the lion's  share falls on housing construction.

The former minister stated that the potential of the Armenian economy  is estimated at 4-5%. At the same time, he indicated that the growth  in economic activity by 14.4% was supported by 3 factors - a  significant increase in transfers of individuals from the Russian  Federation due to the Russian-Ukrainian conflict, relocation and  re-export.

In this regard, Aramyan noted that export growth was registered at  the level of about 70%, which is an unprecedentedly high figure. "But  we need to understand whether we have such a potential. What do we  export? . In this context, Aramyan also recalled that Russia decided  to maintain the mechanism of parallel exports within the EAEU due to  sanction restrictions by the West on the supply of certain types of  products to the Russian Federation.

"Economic growth is good. But you need to understand the following,  that while the sun is shining, you need to repair roofs and install  windows, because the sun won't always shine," he said.  It should be  noted that according to the RA Statistical Committee, in  January-November 2022, economic activity in Armenia increased by  14.4% per annum, with a decline of only 4% in November. The volume of  Armenia's foreign trade turnover for 11 months amounted to $12.5  billion with a y-o-y  growth of 67.8%, due to an increase  in both  exports and imports by 75.2% and 63.6%, respectively - up to $4.7  billion and $7.7. billion.  According to the Central Bank of the  Republic of Armenia, the net inflow of transfers from individuals in  January-November 2022 jumped 2.8 times - up to $2.3 billion, while a  year earlier the growth was more modest (58.5%). In particular, the  inflow of transfers increased by 2.4 times - to $4.6 billion - this  is a new record level, mainly due to a significant increase in  remittances from the Russian Federation - by 4.1 times to $3.2  billion. As a result, the share of the Russian Federation in inflow  jumped to 69% from 41.2% a year earlier.  Experts and financial  authorities in Armenia attribute this to the influx of a huge number  of immigrants from Russia, most of whom moved here along with the  transfer of their capital. The first flow began against the backdrop  of large-scale unprecedented anti-Russian sanctions due to the  Russian-Ukrainian war, and later there was a new influx of immigrants  due to the partial mobilization announced in the Russian Federation.

It should be noted, according to the latest estimates, since the  beginning of March 2022, about 120 thousand foreign citizens  (immigrants) have moved to Armenia, the vast majority of which are  citizens of the Russian Federation.