Armenia needs 7-10% annual growth to secure sustainable economic expansion
30.01.2017,
16:18
To ensure a sustainable economic growth Armenia needs an annual economic expansion of at least 7-10%, a former chairman of Armenia’s Central Bank, Bagrat Asatryan, told a news conference today.
YEREVAN, January 30. /ARKA/. To ensure a sustainable economic growth Armenia needs an annual economic expansion of at least 7-10%, a former chairman of Armenia’s Central Bank, Bagrat Asatryan, told a news conference today. According to him, the economic growth in 2016 will hardly exceed 1%, and a similar low growth is projected for 2017.
Describing the past year as ‘gray and colorless’ that gave Armenia nothing in terms of economic growth, Asatryan said the drop in such sectors as construction and agriculture, which are important in terms of employment is a serious concern, while growth was reported by industry, which is not accompanied by a proportionate increase in jobs.
According to Asatryan, these negative developments can trigger a new wave of out-emigration, which in turn has a negative impact on the overall economic situation. Asatryan said the economic downturn last year was caused also by an unprecedented surge in violence in the Nagorno-Karabakh conflict zone and the seizure of a police station in Yerevan by a group of rebels.
The positive economic developments in 2016, according to Asatryan, included the growth of exports and a drop in imports.
"In general, the past year was a logical continuation of the policy, conducted by the authorities in recent years, a policy that has led to an 11.5% decrease in GDP in the last 8 years (2008-2016) if calculated in US dollars, while the national debt has increased by 311% and the poverty rate rose from 26.4% to 29.8%, " Asatryan said.
He also said that the government’s spending calculated in the national currency, increased by 165% in eight years, while the money allocated for the maintenance of the state apparatus increased by 265%. For comparison, the education sector’s budget increased by only 23.3%.
"Despite the change of prime minister there is still no clear-cut solution to the general situation, " - Asatryan said.
With regard to projections for 2017, Asatryan said this year is going to be a little easier, because of mitigated effect of external factors on Armenia. According to him, the global crisis resulted in a significant reduction in foreign investment in the country last year, however, the situation is expected to improve a little in 2017.
"The expected positive changes in the Russian economy, which is projected to grow by 1.5% this year may to some extent have a positive impact on Armenia," Asatryan said.
According to Armenia’s National Statistical Service, Armenia’s economic activity index in 2016 grew by 0.5%, down from the government projection of 2.2%. --0 ---
Describing the past year as ‘gray and colorless’ that gave Armenia nothing in terms of economic growth, Asatryan said the drop in such sectors as construction and agriculture, which are important in terms of employment is a serious concern, while growth was reported by industry, which is not accompanied by a proportionate increase in jobs.
According to Asatryan, these negative developments can trigger a new wave of out-emigration, which in turn has a negative impact on the overall economic situation. Asatryan said the economic downturn last year was caused also by an unprecedented surge in violence in the Nagorno-Karabakh conflict zone and the seizure of a police station in Yerevan by a group of rebels.
The positive economic developments in 2016, according to Asatryan, included the growth of exports and a drop in imports.
"In general, the past year was a logical continuation of the policy, conducted by the authorities in recent years, a policy that has led to an 11.5% decrease in GDP in the last 8 years (2008-2016) if calculated in US dollars, while the national debt has increased by 311% and the poverty rate rose from 26.4% to 29.8%, " Asatryan said.
He also said that the government’s spending calculated in the national currency, increased by 165% in eight years, while the money allocated for the maintenance of the state apparatus increased by 265%. For comparison, the education sector’s budget increased by only 23.3%.
"Despite the change of prime minister there is still no clear-cut solution to the general situation, " - Asatryan said.
With regard to projections for 2017, Asatryan said this year is going to be a little easier, because of mitigated effect of external factors on Armenia. According to him, the global crisis resulted in a significant reduction in foreign investment in the country last year, however, the situation is expected to improve a little in 2017.
"The expected positive changes in the Russian economy, which is projected to grow by 1.5% this year may to some extent have a positive impact on Armenia," Asatryan said.
According to Armenia’s National Statistical Service, Armenia’s economic activity index in 2016 grew by 0.5%, down from the government projection of 2.2%. --0 ---
