Sun, 7 September
25.1 C
Yerevan
USD: 384.03 RUB: 4.80 EUR: 443.29 GEL: 142.29 GBP: 510.11

Fitch affirms Armenia’s credit rating at ‘B+’ and forecast slightly higher economic growth

YEREVAN, July 27. / ARKA /. The Fitch credit rating agency said today in a note that Armenia’s exposure to Russia — particularly as a source of remittances by expatriate Armenian workers — appears to be a key risk for Yerevan’s economy.

“Armenia’s large exposure to Russia increases risks to its growth prospects and balance of payments and weighs on the rating as a result. Russia is an important source of Armenia’s net receipts of workers’ remittances (80 percent, 2014) and export revenues (20 percent, 2014).

“Remittances, which accounted for 13 percent of Armenia’s GDP in 2014 and are a key driver of private consumption, fell 40 percent year-on-year in the first five months of 2015,” the note reported.
Fitch also expressed concern about Armenia’s external finances, which the agency said are weaker than those of its rating peers: “Net external debt to GDP is high (42.6 percent), and the current account deficit plus net foreign direct investment is large (-4.6 percent).”

However, Fitch affirmed the country’s credit rating at ‘B+’ and forecast slightly higher economic growth than had previously been predicted:

“We have revised upwards our real GDP forecast for 2015 to +1.5 percent from -0.5 percent, to be followed by growth of 2.5 percent and 2.9 percent in 2016 and 2017, respectively. Growth will be mainly constrained by weak private consumption against a lower trend in net remittance receipts.”

A rising government deficit for 2015 is a drag on the economy, the note said: “It is likely to come in at 3.5 percent of GDP, compared with the objective of 2.3 percent of GDP in the original budget, reflecting the weakening of the economy.

“A major objective is to increase government revenues, which are currently low, and an increase in excise duties is currently before parliament. However, tax increases and similar measures will likely face strong social and political challenges, as the recent protests against higher consumer electricity charges demonstrate,” Fitch said.-0-

spot_img

POPULAR

Insurance market of Armenia is in embryonic state

Insurance market of Armenia is in embryonic state

Cryptocurrency in Armenia: Stringent Regulations and Elevated Expectations

The future of cryptocurrencies in Armenia was a topic of discussion among participants at the Armenian Cryptocurrency Assets Forum, which recently took place in Yerevan.

“We want the word ‘investor’ in Armenia to mean normality, not elitism” – Freedom Broker Armenia

ARKA news agency spoke with Freedom Broker Armenia Director Ovak Ovakimian about the transformation of investment thinking, company strategy and trust as an economic value.

Ranking of Armenia’s most profitable banks in 2024

ARKA news agency has released a ranking of the most profitable commercial banks in Armenia in 2024.

Ranking of the most profitable banks in Armenia based on results of second quarter of 2025

ARKA news agency publishes the ranking of the most profitable commercial banks in Armenia based on the results of the second quarter of 2025.

LATEST NEWS

spot_imgspot_imgspot_img