YEREVAN, August 14. /ARKA/. The current devaluation of the yuan will have adverse impacts on Russia’s economy and, as consequence, also on Armenia’s economy, Vardan Bostanjyan, an economist, said in an interview with Sputnik-Armenia portal.
China’s central bank devalued the yuan by nearly 2 percent on Tuesday saying it was a one-time step. The yuan midpoint was set at 6.2298 per dollar, compared with the 6.1162 mid-point on Monday, with the central bank to now base the yuan’s midpoint on market makers’ quotes and the previous day’s closing price.
Bostanjyan said cheaper Chinese goods will come to Russia’s market aggravating domestic industries’ troubles.
“Russia’s worsening things will strike at Armenia’s economy – individual money transfers will be shrinking threatening with grave consequences,” he said. “It means any adverse impact on Russia’s economy inevitably affects Armenia.”
The economist said that the dollar has entered a stage of another expansion, and this influences the yuan stability.
“The current devaluation of the yuan is due to another surge in long years of standoff between Chinese and US currencies,” Bostanjyan said in his interview.
In his opinion, the yuan devaluation sends negative impetuses to Russian and Armenian economies, but this situation is beneficial to the Chinese domestic industry.
“Unlike Russia, whose economy heavily depends on export of raw materials, China can take advantage of the situation by building up its exports, and this will spur growth in domestic industry and will lead to takeover of new markets,” he said.
Bostanjyan thinks China can resist the fall of the yuan better than Russia once resisted the ruble devaluation.
“Chinese businesses both inside and outside the country will try to use every chance to stabilize the currency,” he said. “If the yuan takes a sharp dive against the dollar, as it is now happening to other currencies, this will be not so desirable either for the global economy or for the Russian ruble and will indirectly affect also Armenia.” —-0—–
