Monday, August 7 2023 15:24

ArmInfo.In Armenia, the growth of economic activity in H1 2023 slowed down to 11.4% per annum (from 11.8% in H1 2022), while significantly exceeding the pre-Covid upward  pace of 6.5% in H1 2019.

This is starting to affect export and import  rates. In June of this year by June 2022, the growth of economic  activity slowed down more - to 6.8% (from 18.5% a year earlier,  against 3.4% growth in 2019), while in June 2023 alone moderately  accelerating growth to 9.9% from 7.4% in May (against a more visible  acceleration of growth in June 2022 from 6.1% to 17%, and a slight  slowdown from 8.4% to 8.2% in June 2019). This is evidenced by the  final data of the RA Statistical Committee.

The growth of economic activity in H1 2023 was largely determined by  the trade sector - by 23.6%, to a slightly lesser extent by the  construction sector - by 17% and the service sector - by 16.8%, in  parallel with which there was a slowdown in the growth of the  industrial sector to 1% and reaching a 2% growth in the agricultural  sector, and the energy complex moved down from double-digit growth to  a 2.7% decline. A year earlier, in H1 2022, all these areas, with the  exception of the agricultural sector, which was in a 5.5% decline,  showed growth: the service sector - by 26.9%, the energy complex - by  14.8%, the construction sector - by 12.7%, trade sector - by 10.7%,  industrial sector - by 5.8%.

The price index of industrial products in H1 2023 compared to the  same period in 2022 decreased by 1%, in June 2023 compared to June  2022 it increased by 2.2%, and on a monthly term, it registered a 3%  increase in June from the 3.5% decline in May. A year earlier, in  similar periods, multidirectional dynamics were also recorded: the  price index of industrial products in January-June 2022 compared to  the same period in 2021 increased by 7.8%, in June 2022 compared to  June 2021-decreased by 1.2%, and  in June 2022 alone they lingered in  the decline with a slowdown to 2.9% from 3.1% in May.

On a monthly term (for June 2023), the construction sector gave a  decisive impetus to the growth of economic activity, accelerating the  pace to 20.1% from 19.7% in May, thereby maintaining last year's June  pace, but then there was an imperceptible slowdown from 21% to 20.1%.  Then, the following sectors are followed by growth rates: the energy  complex f - 8.3% (with an improvement from May's 5.1% decline), the  trade sector - 5.5% (against the May 9.6% growth), the industrial  sector - 2.8% (against the May 9.9% growth) and the services sector -  0.7% (with an improvement from May's 1.3% decline). As a comparison,  we note that in June 2022, the industrial sector showed a  double-digit 17.1% growth, trade - 12.8% growth, the service sector -  8% growth, and the energy complex - 6.4% growth, which, in addition  to the latter, in other areas indicates the current slowdown in the  upward pace.

On  y-o-y terms(June 2023 to June 2022), an increase in economic  activity was observed in all sectors, with the exception of the  industrial sector and the energy complex, which were in decline - by  7.4% and 0.3%, respectively. Thus, the turnover of the trade sector  increased by 20.3%, the volume of the construction sector - by 18.1%,  the service sector - by 4%. Moreover, of the listed sectors, only the  trade and construction sector provided some growth acceleration,  while the service sector largely stagnated, and the manufacturing and  energy complex turned from double-digit growth to a full decline. For  clarity, it is worth noting that a year earlier, in June 2022 by June  2021, double-digit growth was observed in all industries:  the  service sector - 35.5%, the energy complex - 25.4%, the industrial  sector - 19%, the trade sector - 18.2%, construction sector - 16.2%.

According to statistical data in H1 2023, the leadership in absolute  terms is held by the trading sector with a volume of 2.3 trillion  drams ($5.9 billion). The services sector recovered to the second  place - 1.4 trillion drams ($3.7 billion), displacing the industrial  sector to the third place - 1.2 trillion drams ($3 billion). The  fourth place is traditionally occupied by agriculture - 278.6 billion  drams ($714.7 million), and the fifth place is occupied by the  construction sector - 174.2 billion drams ($446.8 million). The  volume of electricity generation in H1 2023 amounted to 4270.1  million kWh, of which - 639.8 million kWh in June alone.

In the consumer market of Armenia, inflation slowed down in H1 2023  to 4.2%, in June alone deflationary 1.4% was recorded, and compared  to June 2022, deflation was 0.5%, while last year in the considered  periods, relatively high inflation was recorded: in H1 2022 - at the  level of 8.1%, - at the level of 0.3% in June alone and compared to  June 2021 - it reached double-digit 10.3%.

Against this background, Armenia's foreign trade turnover continues  to demonstrate high growth rates, increasing sharply by 72.9% per  annum in H1 2023, reaching 3.5 trillion drams ($8.9 billion). In its  terms, equally high growth was observed both in imports and in  exports. In particular, the volume of exports increased in y-o-y  terms by 72.8% to 1.3 trillion drams ($3.3 billion), and imports - by  73% to 2.2 trillion drams ($5.6 billion). In June 2023 alone, foreign  trade turnover decreased by 7.9% due to a decrease in both: exports  by 13.1% and imports by 4.8%, while in May this year, these figures  were on the rise - by 7.4%, 9% and 6.4% respectively. In June 2023,  compared to June 2022, the growth of foreign trade turnover slowed  down to 21%, mainly supported by the growth of imports by 33.8% than  exports by 2.5%, while a year earlier (in June 2022 compared to June  2021) these indicators showed a high growth. A year earlier, in  January-June 2022, foreign trade turnover increased by 44% per annum  due to the growth of exports by 36.3% and imports by 48.7%, and the  June growth of foreign trade turnover by 20.2% was provoked by the  upward dynamics of exports by 38.2% with an increase in imports by  10.4%, compared to June 2021, the 71% increase in foreign trade  turnover is mainly caused by the 73.1% increase in imports and a  little less by the 68.1% increase in exports.

It should be noted that the average settlement rate of the dram in  June 2022 was 386.67 AMD/$1, and in January-June 2022 - 389.79  AMD/$1, against 422.69 AMD/$1 in June 2022 and 468.24 AMD/$1 in  January-June 2022 -