Thursday, February 8 2024 16:41
Alina Hovhannisyan

Impact of re-exports on GDP growth within 1% in 2023

Impact of re-exports on GDP growth within 1% in 2023

ArmInfo.The impact of re-exports on GDP growth in 2022 was about 1%, and in 2023 - even  lower, which was associated with changes in the sanctions environment, a new reality replacing traditional directions, Deputy Minister of Economy Rafael Gevorgyan TOLD Armenia's Public TV. 

He explained that the added value of goods that enters Armenia for  re-export has an insignificant impact on the economy, since it is  used only by a certain group of businesses. Only a couple of branches  that contained an additional services component had a significant  impact, he said. In this regard, Gevorgyan, as an example, pointed to  the re-export of inexpensive, damaged cars that needed repairs and  other services.  "This component of additional services created the  result," said the deputy minister.

However, he emphasized that good results were achieved at the end of  the year. In particular, Gevorkyan recalled that the indicator of  economic activity in Armenia in 2023 exceeded 9%, and GDP growth,  according to estimates by the Ministry of Economy, will be about  8.5%.

According to statistical data, in Armenia the growth of economic  activity in January-December 2023 slowed down to 9.4% per annum (from  14.2% in 2022). The dynamics are driven largely by the trade sector -  with an acceleration of annual rates from 17% to 25.7%, and to a  slightly lesser extent by the construction sector - with an  acceleration of rates from 12.5% to 14.8% and the service sector -  with a slowdown in rates 28.2% to 10.3%, against which the growth of  the industrial sector turned out to be modest, slowing from 7.8% to  4.1%.

According to the updated forecasts of the Central Bank (CB of RA),  the International Monetary Fund (IMF), the World Bank (WB), the  European Bank for Reconstruction and Development (EBRD), GDP growth  in Armenia in 2023 was expected at 8.3%, 7%, respectively. , 7.1% and  6.5%. Moreover, for 2024 they predict a slowdown in the growth rate  of Armenia's GDP: according to the expectations of the Central Bank  of the Republic of Armenia, up to 6.1%, according to the expectations  of the IMF, up to 5%, according to the expectations of the World  Bank, up to 4.7%, according to the expectations of the EBRD, up to  4.5%.

Armenia's foreign trade turnover at the end of 2023 exceeded US  $20.7bln, with growth slowing to 46% (from 68.6% in 2022). In  particular, a slowdown in volume growth rates was observed both for  exports - from 77.7% to 55.3% to US $5.4bln, and for imports - from  63.5% to 40.2%, the absolute value of which amounted to US $8.4bln  and US $12.3bln. As a result, the negative balance of foreign trade  of Armenia for 2023, having slowed down from 47.8% to 14.7%, reached  US $3.9bln.   

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