WB improves Armenia's economic growth forecast for 2023, but worsens it for 2024

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Economy

10.01.2024, 09:51

According to World Bank’s Global Economic Prospects, January 2023 report, Armenia's economy is expected to grow by 7.1% in 2023.

WB improves Armenia's economic growth forecast for 2023, but worsens it for 2024

YEREVAN, January 10. /ARKA/. According to World Bank’s Global Economic Prospects, January 2023 report, Armenia's economy is expected to grow by 7.1% in 2023.

In an earlier report published last June, the WB forecasted that the Armenian economy would grow by 4.4% in 2023.

At the same time, WB analysts expect Armenia's GDP to grow by 4.7% in 2024 (the forecast has been worsened by 0.1 p.p. compared to the June forecast), and by 4.5% in 2025 (down 0.5 p.p.).

According to the WB report, the global economy will grow by 2.6% in 2023, up from the previous estimate of 2.1%. In 2024, economic growth will slow to 2.4%, and in 2025 it will recover slightly to 2.7% on the back of lower inflation and monetary policy easing.

The World Bank estimates that global economic growth between 2020 and 2024 is the weakest start to a decade in 30 years.

In the South Caucasus, growth is projected to hold steady at 3.3 percent a year over 2024-25. While further unwinding in money transfer inflows from Russia is expected, re-exports and tourism will continue to support economic activity.

However, long-term growth will remain hampered by commodity dependence, weaknesses in connectivity and logistics, and possible continuing geopolitical tensions between Armenia and Azerbaijan.

The World Bank raised its GDP growth forecast for Russia for 2023 to 2.6% against 1.6% in October, which, according to analysts, is due to significant budget support. At the same time, economic growth will slow down to 1.3% in 2024 and 0.9% in 2025. Experts attribute this to the tightening of the Central Bank's policy.

Armenian government’s growth projection for 2023 is 7%. According to the Central Bank's December forecast, the growth will be 8.3%. -0-

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