Armenia sees significant drop in foreign trade

/By AzerNews/

By Sara Rajabova

In the background of the economic recession in Russia, the Armenian economy is also experiencing great hardships.

The deepening recession in Russia has exacerbated the already miserable situation of the Armenian economy. Armenia’s foreign trade turnover decreased by 32.3 percent in five months.

Armenia’s National Statistical Service reported that the volume of Armenia’s foreign trade turnover in January-May of this year amounted to about $ 1.56 billion which reflects a32.3 percent drop compared to the same period in 2014.

The volume of exports in January-May 2015 amounted to about $ 488.6 million, falling 15.2 percent, while import volume stood at $ 1,070 billion, showing a 38 percent decrease, according to official data. As a result, the foreign trade deficit amounted to a staggering $ 581.5 million.

Armenia's foreign trade turnover with the Commonwealth of Independent States countries in the same period amounted to approximately $305.7 million (19.6 percent share and a 51.8 percent decline), with trade with Russia amounting to $ 242.7 million (54.6 percent decline), $ 50 million (32.7 percent decline) with Ukraine, and about $ 1.4 million (89.8 percent decline) with Belarus.

In meantime, Armenia’s trade volume with European Union countries in January-May totaled approximately $ 462.2 million (29.7 percent share and 28.6 percent decline), and trade with other countries stood at $ 790.8 million (50.7 percent share and 22.4 percent decline).

The country's economic indicators are deteriorating by the day. Recession in Russian economy has been accelerating Armenia's worsening economic situation, since the country relies heavily on money transfers from its “big brother.” The strongest impact carried by the Russian recessions has been seen in the sharp decline of money transfers sent by labor migrants.

Forecasts for the Armenian economy are far from favorable for the next few years. Any positive developments in the Armenian economic depend on Russia coming out of recession.

The global financial crisis in previous years and a hardship that began in late 2014 have once again proved that the fragile Armenian economy depends strongly on regional developments - as reflected by falling foreign investments, remittances, and domestic trade.