Armenian central bank revises downward its economic growth forecast

YEREVAN, December 14. /ARKA/. Armenia’s Central Bank expects the economy to grow by 4.2% in 2021, the chairman of Central Bank Martin Galstyan told a press conference today.

The regulator’s latest economic growth forecast is down from 5.4% prediction that had been announced by it in mid-September.

Galstyan told reporters that the economic activity is estimated to be lower than the forecast made in mid-September due to a slowdown in the agricultural and industrial sectors.

"Nevertheless, the positive impact of demand persists, which is currently supported by the impact of external demand due to higher-than-expected tourism growth," he said.

Armen Nurbekyan, the head of the Central Bank's Macroeconomic Department, added that the structure of economic growth has changed significantly.

"Before the third quarter we were seeing a significant increase in domestic private consumption. Our latest forecast has been revised downward after we saw that domestic consumption was not growing ahead of schedule, but there was a significant increase in external demand," he explained.

Armenia's GDP grew by 2.7% in the third quarter of 2021 compared to the same period of 2020, according to the National Statistical Committee (NSC). The GDP at market prices at the end of the reporting quarter amounted to a little over 1.9 trillion drams. Compared to the second quarter of 2021 the GDP grew by 25.2%.

The International Monetary Fund (IMF) said in its latest World Economic Outlook report for October 2021 that it expects Armenia's economy to grow 6.5% in 2021 and 4.5% in 2022.

The forecast is up from 1% growth forecast made by the IMF in its previous report released in April, which predicted also a 3.5% growth for 2022.

The World Bank has revised its forecast for Armenian economic growth to 6.1 percent, up from 3.4 percent in April 2021. Earlier, Armenia's government also revised upward its previous forecast of 3.2% to 6 %. -0-