Armenian Central Bank Revises GDP Forecast Downward

ARMENIAN CENTRAL BANK REVISES GDP FORECAST DOWNWARD

Interfax
May 19 2009
Russia

The Central Bank of Armenia said in a new forecast that the nation’s
GDP will decline 5.8% in 2009, according to the bank’s fiscal policy
program for the second quarter of 2009.

The Central Bank previously forecast GDP to decline 3% in 2009.

The forecast includes a 3% contraction in the agricultural sector,
4.5%-7% in industry, and 15%-19% in construction, while the service
sector will expand 2.5%.

Inflation will amount to 4% plus or minus 1.5 percentage points.

That is down from the earlier inflation forecast of 5.9%.

Economic trends at the end of 2009 and early 2010 will depend on
developments in the global economy as well as the pace and scope of
government anti-crisis measures, the document says.

It was reported earlier that Armenian GDP fell 6.1% in the first
quarter of 2009 compared with growth of 8.8% in the same period
of 2008.

The 2009 budget assumes the economy will grow 9.2% in 2009 and
inflation will equal 4% plus or minus 1.5 percentage points. So far
the government has not announced plans to revise those parameters.

The International Monetary Fund forecasts Armenian GDP to contract 5%
in 2009, the largest drop among the Trans-Caucasus and Central Asian
nations (previously the IMF forecast GDP to decline 1.5% in 2009).

Growth will be nil in 2010 and positive in 2011, the IMF said.