ACTUAL REDUCTION OF ADDED VALUE IN CONSTRUCTION OF ARMENIA TOWARDS END OF 2009 TO BE 40-50% – CENTRAL BANK

ARKA
July 30, 2009

YEREVAN, July 30. /ARKA/. The Central Bank of Armenia has revised
the forecast for such industries as construction and services,
which constitute a substantial share of the GDP, and lowered its
expectations.

Consequently, the actual reduction of added value in construction in
Armenia by the end of 2009 will be 40-50%.

As it was reported in the Program of the Monetary Policy of the CBA
in the 3rd quarter of 2009, this was going to happen despite the
gradual reduction in the rate of decline in construction conditioned
by financial support from the government.

In the first half of 2010, the downturn in the construction will
continue.

However, by the end of half-year there will be a positive growth
indicator.

The revision of the forecast is due to the expected reduction in
capital flows and incomes, as well as a significant decline in
residential construction.

According to CBA’s forecast, a zero real growth of added value is
expected in 2009.

However, in the first half of 2010, it is expected to restore the
services, with a real growth of 1-4%.

The CBA states that such predictions depend on specifying the
forecasted indicators of private and public consumption, which
affect both the volume of turnover and other volumes of the services
provided.