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World Bank says Armenian government's economic growth forecast unrealistic

06 March 2015 [12:40] - TODAY.AZ

/By AzerNews/


By Mushvig Mehdiyev

The World Bank has come up with a new report on Armenia that promises no significant economic growth in the country this year.

Referring to the latest economic indicators, WB excluded any considerable breakthrough in Armenia's economy which currently is suffering from a major slowdown, very similarly to Armenia in 2009 crisis.

"Armenia's economy will remain in stagnation this year as well," World Bank Country Manager in Yerevan, Laura Bailey said.

Bailey explained that the slowdown observed in Armenia's economic growth in 2014 is tied to a Yerevan's dependence on Russia as its main economic and trade partner as well as a global slowdown in Europe in general.

"Problems emerged in Russia based primarily on a drop in oil prices and to some extent on Western sanctions. For Armenia, we forecast a stagnated economy in 2015," she said.

Armenian government expects a 4.1 percent growth in country's economic skills this year. However, Bailey believes that the provided forecast is unrealistic given the ongoing difficulties the country is facing. She even went as far as saying she expects Yerevan to lower its forecast this month.

"The government's 4.1 percent growth expectation could have been realistic six months ago when it was drawing its state budget. We are sure that the authorities will introduce new figures for economic growth rate in the upcoming meeting this month," Bailey said.

The World Bank's very recent prediction for Armenia’s economic growth in 2015 stood at 3.3 percent after the world's top banker had to lower its expectation from an earlier forecast of 5 percent.

The current economic atmosphere in Armenia is viewed as reminiscent of 2009 crisis as the gross domestic product in this former Soviet country grew by 3.4 percent in 2014, disproving the expected target announced by the government earlier last year.

Local experts, including Artak Manukyan say Armenia's economy is observing a free fall, characterized by year-on-year worsening life conditions in the country. Social indicators in 2013 were more positive than in 2014. Experts believe that 2015 and 2016 will see a worsening of all social indicators.

Based on the aforementioned stagnation, Armenia got bad mark also from Fitch and Moody's as both have downgraded their outlooks for the former Soviet nation's economic growth. The European Bank for Development and Reconstruction has even zeroed out its forecast on economy for Armenia in 2015.

URL: http://www.today.az/news/regions/139066.html

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