ArmInfo.Armenia's GDP for the first 9 months of 2024 exceeded 6.9 trillion drams or $17.7 billion, showing a 12.8% year-on-year increase. This growth rate is similar to the previous year, when a slowdown from 21% to 12% was observed. This is evidenced by the data from the RA Statistical Committee, released on November 20, presenting the GDP at market prices. The GDP dynamics for the year showed a negative trend only in the first quarter with a decline of 36.1%. This was followed by a positive growth of 16.1% in the second quarter and a further acceleration to 25.6% in the third quarter. This pattern mirrored the quarterly dynamics of 2023, where a 36.3% decline in the first quarter was followed by a growth of 16.5% in the second quarter and a further acceleration to 27.2% in the third quarter.
The GDP deflator index for the 9 months of 2024 showed minimal annual growth: 100.8% in the first quarter, 100.6% in the second quarter, and 101.1% in the third quarter. In comparison, during the same period in 2023 there was a noticeable slowdown in growth from 107.3% in the first quarter to 103.1% in the second quarter and further down to 101% in the third quarter. Quarterly GDP per capita increased steadily over the first 9 months of this year: from 637,651,000 drams ($1,581 thousand) in the first quarter to 750,902,000 drams ($1,931 thousand) in the second quarter and further to 894,328,000 drams ($2,306 thousand) in the third quarter. This trend was also observed in 2023, with GDP per capita increasing from 600,249,000 drams ($1,529,000) in the first quarter to 716,830,000d drams ($1,852,000) in the second quarter and reaching 862,991,000 drams ($2,233,000 in the third quarter.
This growth in per capita GDP is recorded against the background of an increase in Armenia's population by 112.7 thousand people - to 3.067 million people by October 1, 2024. In the same period of 2023, per capita GDP growth was observed despite a population decrease of 16 thousand people (from 2.971 million to 2.955 million people - according to updated data). It is important to note that this time, population growth is not primarily due to natural growth but rather due to the citizens of Artsakh forcibly displaced to Armenia during the tragic events of September 2023. Annual GDP growth was mainly supported by the trade sector - 19.5%, the construction sector - 15.9% and the industrial sector - 12.6%. To a lesser extent by the services sector - 5.9%, the energy complex - 3% and the agricultural sector - 1.8%. For comparison, we note that a year earlier, the industrial sector and the energy complex were in decline - 0.6% and 2.8%, respectively, while other sectors demonstrated higher growth rate: trade - 23.3%, construction - 17%, services - 13.4%, and the agricultural sector showed the smallest growth at 1.7%.
Armenia's foreign trade turnover continued to accelerate in growth, increasing from 45.8% in the first 9 months of 2023 to 73.5% in the first 9 months of 2024. This growth was mainly due to a 2.1-fold jump in exports and a 54.2% increase in imports. This was a significant improvement compared to the previous year, which saw similar growth rates in exports and imports at by 44.8% and 46.4%, respectively. It is worth noting that a substantial growth (6.1-6.3 times) in both exports and imports came from precious metals and stones. Given the low production volumes in the jewelry industry, this indicates re-export and re-import activities, which still have high volumes based the data for the first 9 months of 2024. This is further supported by semi-annual customs data, showing that gold is primarily imported from Russia (95.9%) and exported to the UAE (84.2%). Additionally, the majorityof diamonds come from India (45.2%), Russia (21.4%) and Hong Kong (19.7%) and are also exported to the UAE (82.7%).
It should be noted that the Central Bank's September forecast for GDP growth in 2024 (6.5-5.8%) now differs little from the updated forecasts of the IMF and WB. They predict that Armenia's GDP growth in 2024 will slow down to 6% and 5.5%, respectively. International rating agencies also predict a similar slowdown in Armenia's GDP growth in 2024: S&P Global Ratings expects up to 6.2%, Fitch Ratings - up to 6% and EBRD expects 6.2% growth in Armenia's GDP in 2024. For 2025, the Central Bank's forecasts for GDP growth (5.9-3.7%) also align closely with the expectations of EBRD, IMF, and WB - 4.8%, 4.9% and 5%, respectively. The draft budget for 2024 includes a GDP growth of 7%, while the draft budget for 2025 sets a lower bar of 5.6%. According to statistics, Armenia's GDP growth in 2023 slowed to 8.3% (from 12.6% in 2022).
