YEREVAN, June 9. /ARKA/. Economic growth in Armenia is expected to speed up this year thanks to a rally seen in industry and construction sectors.
Armenia’s industry has grown 12.9% over five months of this year, compared with the same period a year before, mainly thanks to mining industry, and reached AMD 242.6 billion by late May.
Agriculture segment showed 5.25% and construction 8.8% year-on-year growth in Jan-May 2010.
According to official statistical reports, Armenia enjoyed 7.2% real year-on-year economic growth in Jan-Apr 2010 and faced 1% inflation in May, compared with April.
In the 2010 government budget, annual GDP growth was planned at 1.2% and inflation at 4% (+/-1.5%).
The country’s foreign trade turnover grew as well.
Armenia’s trade turnover with EU countries has grown 38.5% over four months of 2010, compared with the same period a year earlier, and amounted to $454.5 million by late April.
Money transfers totaled $138.6 million in late April after growing 5.4% over the period between January and April 2010, compared with the same period of the previous year.
It means that not only the economy, but also transfers are recovering now.
Along with that, living standards are improving.
For example, an average monthly salary rose 7.5% in Jan-Apr 2010, compared with the same period a year before, and came close to AMD 104,000.
Paid services grew 6.4% to AMD 231 366 million.
The economic growth was also fueled by personal consumption and fiscal expenses (AMD 520 billion) in late 2009.
Large foreign financing should be singled out as one of important factors as well.
This outside financing has been received from two sources – AMD 1 billion came as foreign assistance intended for being invested in the country’s economy in the coming two years for resisting the crisis, and private transfers, which made up eight to nine percent of GDP.
It is known that foreign capital inflow is one of the key components of economic growth.
That is why any economy’s growth based on investments is better than that based on the population’s incomes, since it propels technological chains, and hence is more intensive.
The attracted financial resources, estimation of current situation and the government’s forecast give ground for optimistic outlooks for this year.
However, some experts are not so optimistic about the future and call the quality of this four-year economic growth into question. They find this growth unreliable.
For example, Bagrat Asatryan, former chairman of the Central Bank of Armenia, thinks that Armenia’s economic growth was due to global developments, first of all rise in prices for mining industry’s products, particularly for copper.
The expert is concerned about the agriculture sector, which shows no progress, despite the government’s statements.
In his opinion, the country’s foreign trade balance gives ground for concern as well.
He thinks the deep decline Armenia has suffered for the last decade is continuing.
At the same time, the main world financial centers’ analysis shows that majority of leading experts view economic recovery as irrefutable fact.
This prompted the International Monetary Fund to reconsider its outlooks and make them more optimistic.
In particular, the IMF said in its “The Economic Outlook” report that the global economy would grow 4.2% and Armenia’s economy would grow 4% in 2010.
The IMF predicts about six-percent inflation in Armenia this year, while in its previous outlook, the IMF predicted 1.8% GDP growth in Armenia for 2010 and 3% for 2011.
These favorable trends encouraged IMF to pledge another $392 million to Armenia.
If financial and economic things in the world develop as the IMF forecasts, economic growth in Armenia will be 2 or 2.5 times higher than that planned by the government in the 2010 budget.
All the countries of Commonwealth of Independent States show economic growth.
So, it can be placed on the record that the CIS economies are on the recovery track now.-0—
