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Armenian Trade Deficit Continues Growth During H1

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  • Armenian Trade Deficit Continues Growth During H1

    ARMENIAN TRADE DEFICIT CONTINUES GROWTH DURING H1
    by Diego Iscaro

    World Markets Research Centre
    Global Insight
    August 1, 2008

    Latest data show that Armenian external imbalances continued to
    deteriorate during the fist six months of 2008. Indeed, according
    to data from the country's National Statistical Service reported by
    ARMNIFO, the trade deficit stood at $1US.387 billion during the fist
    half of 2008, as exports fell by 0.8% year-on-year (y/y) to $520US
    million and the total value of imports increased by 40.3% y/y to
    $1US.908 billion. Geographical trade data show that Armenia's trade
    deficit with countries from the European Union (EU) was widened by
    57.0% y/y to $331US.0 million, while the deficit with other countries
    of the Commonwealth of Independent States (CIS) rose by 52.5% y/y to
    $433US.0 million. Furthermore, detailed data revealed that exports of
    precious and semiprecious stones waned by 23.3% y/y to $82US.0 million,
    while exports of rough ore rose by 25.9% y/y to $85US.0 million.

    Significance:Strong domestic demand is fuelling import growth, while
    export potential remains mainly dependent on the diamond trade. Global
    Insight believes that these factors are likely to remain in place
    during the rest of 2008. Indeed, the value of imports is set to be
    boosted by a combination of robust demand for investment goods and high
    international oil prices. Nevertheless, strong output growth should
    result in a waning of the deficit-to-GDP ratio in 2008 as a whole.
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