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ARMENIAN GDP, EXPORTS CONTINUE RAPID CONTRACTION DURING OCTOBER
Venla Sipila
World Markets Research Centre
Global Insight
Nov 23 2009
According to the latest national accounts figures from the Armenian
National Statistical Service, the country's economy collapsed by
17.5% year-on-year (y/y) in January-October, ARKA News reports. In
October alone, GDP contracted by 5.1% from September. Coming after
the January-September contraction of 18.3% y/y, these most recent
figures suggest some moderation in the rate of annual output decrease
in October.
However, this does not provide much reason for cheer, especially
compared with the very respectable economic growth rate of 9.2%
y/y seen in the first 10 months of last year. Industrial output in
January-October fell by 11.4% y/y, whereas activity in the construction
sector plummeted by 41.6% y/y. Meanwhile, agricultural production fell
by 0.8% y/y. Further, it was reported that exports from Armenia in the
first 10 moths of the year suffered a fall of 40.7% y/y, amounting
to $551US.6 million, while imports at the same time contracted by
28.5% y/y, totalling $2US.57 billion. Thus, the trade deficit for
the January-October period came in at $2US.018 billion. The figures
suggest some deceleration in the annual exports contraction in October,
whereas the fall in imports slightly accelerated. In October alone,
exports decreased by 1.4% from September, while imports increased by
6.1% from the previous month.
Significance:Whereas the severe collapse of the Armenian economy now
should start to ease, as cautiously suggested by the latest data, the
still worse-than-expected performance in the third quarter justified
yet another downward revision in IHS Global Insight's Armenian GDP
forecast in the November round. We expect 2009 annual contraction to
somewhat exceed the lower end of the government's forecast of a 10-15%
fall. The extreme severity of the current Armenian economic conditions,
including its major liquidity pressures, has been underlined by the
fact that it has had to seek revisions to its stand-by arrangement with
the International Monetary Fund (IMF), which has approved changes to
programme terms and payment schedules (seeArmenia: 3 November 2009:).
Venla Sipila
World Markets Research Centre
Global Insight
Nov 23 2009
According to the latest national accounts figures from the Armenian
National Statistical Service, the country's economy collapsed by
17.5% year-on-year (y/y) in January-October, ARKA News reports. In
October alone, GDP contracted by 5.1% from September. Coming after
the January-September contraction of 18.3% y/y, these most recent
figures suggest some moderation in the rate of annual output decrease
in October.
However, this does not provide much reason for cheer, especially
compared with the very respectable economic growth rate of 9.2%
y/y seen in the first 10 months of last year. Industrial output in
January-October fell by 11.4% y/y, whereas activity in the construction
sector plummeted by 41.6% y/y. Meanwhile, agricultural production fell
by 0.8% y/y. Further, it was reported that exports from Armenia in the
first 10 moths of the year suffered a fall of 40.7% y/y, amounting
to $551US.6 million, while imports at the same time contracted by
28.5% y/y, totalling $2US.57 billion. Thus, the trade deficit for
the January-October period came in at $2US.018 billion. The figures
suggest some deceleration in the annual exports contraction in October,
whereas the fall in imports slightly accelerated. In October alone,
exports decreased by 1.4% from September, while imports increased by
6.1% from the previous month.
Significance:Whereas the severe collapse of the Armenian economy now
should start to ease, as cautiously suggested by the latest data, the
still worse-than-expected performance in the third quarter justified
yet another downward revision in IHS Global Insight's Armenian GDP
forecast in the November round. We expect 2009 annual contraction to
somewhat exceed the lower end of the government's forecast of a 10-15%
fall. The extreme severity of the current Armenian economic conditions,
including its major liquidity pressures, has been underlined by the
fact that it has had to seek revisions to its stand-by arrangement with
the International Monetary Fund (IMF), which has approved changes to
programme terms and payment schedules (seeArmenia: 3 November 2009:).