Armenia's economy: bluff due to weakness

By AzerNews

The Armenian government has recognized that it will not be able to realize its economic predictions for 2014.

Armenia's state budget for 2014 estimates economic growth at 5.2 percent, but the government says the risks that will make economic growth be lower this year have increased.

The Armenian authorities' economic forecasts have not justified in recent years; the government ensured only a 3.5 percent economic growth in 2013, instead of the predicted six percent.

The government explains the risks mainly with the degradation of the economic situation in Russia, which is a major market for many Armenian goods. In addition to that, most of the investments and transfers in Armenia come from Russia. Any change for the worse in the Russian economy will be unfavorable for the Armenian economy.

These explanations are the foolish economic and political mistakes of the Armenian authorities, MP Grant Bagratyan, former Prime Minister, wrote on his Facebook page.

"Four months ago, the former prime minister linked the slowdown in economy with the global slowdown. It turned out that it was wrong," he wrote. "If it continues, the authorities can always say that the Russian, or European, or the World economy limps."

Bagratyan has many doubts about the economic indicators for the first three months of 2014, recently published by the National Statistics Service.

"The largest increase at 5.2 percent was recorded in agriculture, while the late frosts that occurred on March 30-31 were unprecedented in the last few years," he noted.

The Armenian authorities are blaming others for the deteriorated economic situation, while international organizations are reducing economic prognoses for the country.

The International Monetary Fund (IMF) has reduced Armenia's economic growth forecast in 2014 by about half a percentage. Economic growth in Armenia will be 4.3 percent, the fund's recent "World Economic Outlook" report specified.

The IMF's report published in October 2013 predicted that economic growth in Armenia would be recorded at 4.8 percent in 2014.

Meanwhile, Armenia's external debt increased by 4.4 percent and exceeded $4 billion in 2013 compared to the previous year, the central bank reported.