Central bank of Armenia revises its economic decline forecast
27.10.2020,
18:29
Armenia's Central Bank has revised its previous 2020 economic decline forecast saying it expects a 7% drop, according to Central Bank chairman Martin Galstyan.
YEREVAN, October 27. /ARKA/. Armenia's Central Bank has revised its previous 2020 economic decline forecast saying it expects a 7% drop, according to Central Bank chairman Martin Galstyan.
Speaking at a news conference today he said the economic activity in the third quarter was low, falling by 7, 5% in September compared to the same month last year. The drop was expressed in a significant reduction in the services, he said.
He said despite the fiscal stimulus policy, domestic demand was slightly weaker than expected during the quarter due to a deeper decline in private consumption.
"The large-scale military offensive by Azerbaijan along the entire line of contact against Artsakh since September 27, as well as the rapid spread of the coronavirus in the first half of October, have created a negative environment in terms of both supply and demand," Galstyan said.
He said the Central Bank estimates that along with some reduction in production, uncertainty about the prospects for economic growth will increase, which will slow down the recovery of economic activity and domestic demand. According to him, in this situation, the government envisages an expanding fiscal policy.
“In general, the impact of the war in the context of economic growth is estimated at around 1%. Consequently, the decline, which we predicted, will increase and make about 7% by the end of the year,”Galstyan said.
According to the National Statistical Committee, the country's economic activity in January-September 2020 registered a decline of 6.6% compared to the same period in 2019.
On April 29, the National Assembly of Armenia approved a revision of 2020 budget indicators, prompted by the spread of COVID-19. The budget forecast for GDP was reduced to a decline of 2%, down from the originally projected growth of 4.9%. The budget deficit was increased to 340 billion drams, or 5% of GDP, up from previous projection of 2.3%. 0
Speaking at a news conference today he said the economic activity in the third quarter was low, falling by 7, 5% in September compared to the same month last year. The drop was expressed in a significant reduction in the services, he said.
He said despite the fiscal stimulus policy, domestic demand was slightly weaker than expected during the quarter due to a deeper decline in private consumption.
"The large-scale military offensive by Azerbaijan along the entire line of contact against Artsakh since September 27, as well as the rapid spread of the coronavirus in the first half of October, have created a negative environment in terms of both supply and demand," Galstyan said.
He said the Central Bank estimates that along with some reduction in production, uncertainty about the prospects for economic growth will increase, which will slow down the recovery of economic activity and domestic demand. According to him, in this situation, the government envisages an expanding fiscal policy.
“In general, the impact of the war in the context of economic growth is estimated at around 1%. Consequently, the decline, which we predicted, will increase and make about 7% by the end of the year,”Galstyan said.
According to the National Statistical Committee, the country's economic activity in January-September 2020 registered a decline of 6.6% compared to the same period in 2019.
On April 29, the National Assembly of Armenia approved a revision of 2020 budget indicators, prompted by the spread of COVID-19. The budget forecast for GDP was reduced to a decline of 2%, down from the originally projected growth of 4.9%. The budget deficit was increased to 340 billion drams, or 5% of GDP, up from previous projection of 2.3%. 0
