Armenia’s real GDP to decrease by 3.9% in 2020 - ACSES
28.04.2020,
13:24
Armenia’s real GDP will decrease by 3.9% in 2020, according to the consensus forecast of economic indicators and an assessment of government assistance programs to counter COVID-19, provided by ACSES, Armenian Center for Socio-Economic Studies.
YEREVAN, April 28. /ARKA/. Armenia’s real GDP will decrease by 3.9% in 2020, according to the consensus forecast of economic indicators and an assessment of government assistance programs to counter COVID-19, provided by ACSES, Armenian Center for Socio-Economic Studies.
16 Experts
On April 15 to 20, ACSES Analytical Center conducted an expert survey on economic indicators and evaluation of government assistance programs to counter the Covid-19, in which 16 economists took part. They are Bagrat Asatryan, Vardan Bostanjyan, Ruben Gevorgyan, Armen Yeghiazaryan, Julieta Tadevosyan, Vahagn Khachatryan, Vilen Khachatryan, Manuk Yergnyan, Tatul Manaseryan, Heghine Manasyan, Atom Margaryan, Hrant Mikaelyan, Suren Parsyan, Tigran Jrbashyan, Edward Sandoyan and Haykaz Fanyan.
All the experts presented their forecasts for changes in real GDP in 2020, the 12-month inflation and the average exchange rate of dram to dollar in December 2020. The experts also evaluated the productivity of the social and economic components of government assistance programs to neutralize the adverse consequences of COVID-19, and also expressed their positions on individual mechanisms of economic assistance.
Macroeconomic Forecasts
According to the consensus forecast, the real GDP in Armenia in 2020 will decrease by 3.9%, which is lower than the recent forecasts of the Central Bank, as well as the latest outlook of the ministry of finance, international financial institutions and rating agencies.
At the same time, economic analysts predict that 12-month inflation will be 1.8%, which, although higher than the previous year, is below the central bank’s projected indicator, 4% (± 1.5%).
In addition, experts think that the dram is expected to go down against the dollar. They say the dollar in December 2020 is thought to be traded at 499 drams, which is 4.3% more than in December 2019.
Government Assistance Funds
According to a consensus assessment of experts, the government’s assistance for cushioning COVID-19 adverse impacts is thought to total AMD 395 billion.
Experts also gauged the effectiveness of the social and economic components of government assistance programs. In their opinion, on a 5-point scale, the average score of the social component is estimated at 3.1, and the economic at 2.5 points.
In other words, government assistance programs are more effective in terms of stimulating full-scale demand (social programs) than full-scale supply (economic programs).
Assessment of Assistance Mechanisms
Experts were also invited to express their views on the following mechanisms of economic assistance:
• reduction or zeroing of certain types of tax rates for the most affected types of economic activity,
• tax deferral for business entities of separate segments of the economy,
• lending to certain business entities without intermediaries and subject to repayment,
• participation in the establishment of new companies on the equity participation principle,
• Definition of shorter depreciation periods for new capital investments.
Of the mechanisms mentioned above, experts most approved the following:
• tax deferral for business entities of separate segments of the economy,
• participation in the establishment of new companies on the principle of equity participation.
About ACSES
ACSES (Armenian Center for Socio-Economic Studies is an analytical center whose goal is to assist in the development of a public policy through conducting socio-economic studies. --0—
16 Experts
On April 15 to 20, ACSES Analytical Center conducted an expert survey on economic indicators and evaluation of government assistance programs to counter the Covid-19, in which 16 economists took part. They are Bagrat Asatryan, Vardan Bostanjyan, Ruben Gevorgyan, Armen Yeghiazaryan, Julieta Tadevosyan, Vahagn Khachatryan, Vilen Khachatryan, Manuk Yergnyan, Tatul Manaseryan, Heghine Manasyan, Atom Margaryan, Hrant Mikaelyan, Suren Parsyan, Tigran Jrbashyan, Edward Sandoyan and Haykaz Fanyan.
All the experts presented their forecasts for changes in real GDP in 2020, the 12-month inflation and the average exchange rate of dram to dollar in December 2020. The experts also evaluated the productivity of the social and economic components of government assistance programs to neutralize the adverse consequences of COVID-19, and also expressed their positions on individual mechanisms of economic assistance.
Macroeconomic Forecasts
According to the consensus forecast, the real GDP in Armenia in 2020 will decrease by 3.9%, which is lower than the recent forecasts of the Central Bank, as well as the latest outlook of the ministry of finance, international financial institutions and rating agencies.
At the same time, economic analysts predict that 12-month inflation will be 1.8%, which, although higher than the previous year, is below the central bank’s projected indicator, 4% (± 1.5%).
In addition, experts think that the dram is expected to go down against the dollar. They say the dollar in December 2020 is thought to be traded at 499 drams, which is 4.3% more than in December 2019.
Government Assistance Funds
According to a consensus assessment of experts, the government’s assistance for cushioning COVID-19 adverse impacts is thought to total AMD 395 billion.
Experts also gauged the effectiveness of the social and economic components of government assistance programs. In their opinion, on a 5-point scale, the average score of the social component is estimated at 3.1, and the economic at 2.5 points.
In other words, government assistance programs are more effective in terms of stimulating full-scale demand (social programs) than full-scale supply (economic programs).
Assessment of Assistance Mechanisms
Experts were also invited to express their views on the following mechanisms of economic assistance:
• reduction or zeroing of certain types of tax rates for the most affected types of economic activity,
• tax deferral for business entities of separate segments of the economy,
• lending to certain business entities without intermediaries and subject to repayment,
• participation in the establishment of new companies on the equity participation principle,
• Definition of shorter depreciation periods for new capital investments.
Of the mechanisms mentioned above, experts most approved the following:
• tax deferral for business entities of separate segments of the economy,
• participation in the establishment of new companies on the principle of equity participation.
About ACSES
ACSES (Armenian Center for Socio-Economic Studies is an analytical center whose goal is to assist in the development of a public policy through conducting socio-economic studies. --0—
