Former Armenian central bank head forecasts ten-percent economic decline in 2009

YEREVAN, March 12. /ARKA/. On Thursday, Bagrat Asatryan, representative of opposition Armenian National Congress and former chairman of Central Bank of Armenia, speaking at a news conference, said Armenia will record ten-percent economic decline in 2009. 

“2009 will be one of the most difficult and complicated year in Armenia’s economic record, since some signs of it are already seen. This year we’ll face quite high inflation and economic decline exceeding ten-percent benchmark”, he said.

World Bank predicts zero economic growth and IMF 1.5% growth slowdown in Armenia in 2009. Armenian Government planned 9.2% GDP growth in the 2009 state budget, but officials expect a slight economic growth.

Asatryan grounded his forecast on 20-percent economic decline of the fourth quarter of 2008. He also pointed out considerable, 40-percent decline in construction sector in the 4th Q 2008.

He thinks the same will go on also in 2009. The former head of the Central Bank singled out services as another sector to be stricken badly in 2009.

This sector along with construction makes 50% of the country’s GDP. Asatryan also predicts reduction in import. He views it as positive factor for domestic manufactures, but says this will lead to reduction in services and trade area.

“Industry is now under grave threat because of fall in prices in mining industry, despite they slightly climbed recently”, he said. He said that copper concentrates were exported at $8,000 per ton in 2008, while in the future, up to 2015, the price will range from $3,000 to 4,000, as experts predict.

Hence, Armenian business will fin itself in disadvantage. Asatryan said the real estimation of inflation would depend on the steps to be taken by the authorities.

He thinks the authorities should curb monopolists. But as a whole, Armenia will reach a deadlock or be close to it, and relevant officials should take vigorous measured to prevent that. M.V.-0--