YEREVAN, July 9. /ARKA/. A rather interesting picture of increased foreign investment is emerging in Armenia’s capital market, said Armen Ktoyan, a member of the Board of the Central Bank of Armenia, in an interview with CivilNet.
According to him, in the first five months of this year, non-resident investment in dram bonds nearly doubled compared to the same period last year, reaching 10%.
Ktoyan also noted a decline in the risk premium in Armenia.
“A very important trend that we must document is the decline in the risk premium in the case of the Republic of Armenia. And it is gratifying to note that in the case of the Armenian financial market, so to speak, the behavior of the risk premium has begun to diverge to a certain extent from that of other developing economies,” he noted.
According to Ktoyan, while Armenia previously followed the trajectory of emerging markets, recently the risk premium has become closer to the model of developed countries.
“Certain shock effects, such as the geopolitical negatives that emerged in the Middle East—security issues, so to speak—didn’t impact the risk premium in our case the same way as in a number of other countries in the region. That is, Armenia is assessed somewhat differently, and this creates an important prerequisite for future investment and economic growth,” Ktoyan said.
Speaking about economic diversification, he noted that a more diversified economy with proportionate development across various sectors is preferable.
“Nevertheless, we are dealing with the current reality. High growth rates in construction continue. This is one of the most important drivers of economic activity,” Ktoyan said.
He added that tourism services have seen significant growth in external demand, exceeding 20%, financial services offer significant opportunities, and the IT sector has seen some export activity. “Armenia is also attractive today in terms of portfolio investment,” the Central Bank Council member stated.
