Armenia monthly economic update according to the World Bank June-July 2020

eadmin

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Following a good start to 2020, COVID-19 brought economic activity to a halt;

  1. GDP expanded by 3.8 % year-on-year (YOY) in the 1st quarter (Q1) of 2020.
  2. Investment declined by more than 20% in the 1st quarter of 2020.
  3. Economic activity dropped by 17% in April (YOY) following a 4 % growth in the Q1.
  4. The budget registered an AMD 20 billion deficit in April, reducing the cumulative surplus in the first 4 months to AMD 18 billion.
  5. Imports declined by 22% in May (YOY) reflecting lower imports of all product groups, except for food items. Import compression led to a narrowing of the trade deficit from US$ 153 million in April to US$ 120 million in May.
  6. Inflation increased slightly in May, but at 1.2% (YOY) remains low. Inflation continues to edge up and reached 1.7% YOY in June, still below the CBA inflation target band (4+/-1.5 %).
  7. Budgetary expenditures grew by about 40% in April, while revenues declined. This reflects the Government’s COVID-19 response support packages. The same happened in May, 2020. The budget registered an AMD 43 billion deficit in May, turning the cumulative budget balance for the year to deficit at AMD 25 billion. Revenues were declined 23% YOY in May, reflecting lower collection on most taxes. Expenditures were up by 11% YOY due to higher spending on all major categories, except wages and interest payments, reflecting also government’s COVID-19 response support packages

Graph 1. Budget balance in the end of May turned to deficit (in AMD million).

Source:  https://bit.ly/2AG7h4F 

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