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STRENGTH OF ARMENIAN GROWTH AND EXPORTS PERSISTS IN SEPTEMBER
Venla Sipila
Global Insight
November 1, 2011
According to the latest estimates from the Armenian National
Statistical Service, economic activity in September soared by 9%
year-on-year (y/y), ARKA News reports, marking some moderation from the
August growth rate of 9.6% y/y. In month-on-month (m/m) terms, growth
reached 17%. These rates brought expansion for the January-September
period to 6.4% y/y. Annual industrial growth in September registered
16.6%, but construction activity fell by over a fourth from September
last year. Meanwhile, agricultural output increased by 18.6% y/y,
while it swelled by nearly 40% from August.
Further, the Statistical Service also reported on foreign trade data.
Goods exports in January-September increased by 33.5% y/y, amounting
to USD970 million, whereas import growth was clearly more modest, at
12% y/y. With imports totalling USD2.980 billion, the trade deficit
for the first three quarters of the year totalled around US2.0
billion. Most important export good groups included mining products,
non-precious metals, and precious and semiprecious stones. Key import
goods consisted of mining products and machinery and equipment,
among other things.
Significance:The latest estimates of Armenian economic performance
testify to persistent strength of economic expansion, while pointing
to some improvement in external balances. Encouragingly, annual
export growth somewhat accelerated from August while import growth
moderated clearly. This probably partly reflects lower growth of
food product imports, due to better domestic harvest than last year,
when agricultural output was badly hit by drought. Export value has
also benefited from high metal prices. While the Armenian economic
recovery recently has been surprisingly strong, it is now likely to
lose momentum. Moreover, risks increase going forward, given that the
global economic outlook is very uncertain, and any marked external
growth slowdown would restrict availability of crucially important
remittance inflows to Armenia.
Venla Sipila
Global Insight
November 1, 2011
According to the latest estimates from the Armenian National
Statistical Service, economic activity in September soared by 9%
year-on-year (y/y), ARKA News reports, marking some moderation from the
August growth rate of 9.6% y/y. In month-on-month (m/m) terms, growth
reached 17%. These rates brought expansion for the January-September
period to 6.4% y/y. Annual industrial growth in September registered
16.6%, but construction activity fell by over a fourth from September
last year. Meanwhile, agricultural output increased by 18.6% y/y,
while it swelled by nearly 40% from August.
Further, the Statistical Service also reported on foreign trade data.
Goods exports in January-September increased by 33.5% y/y, amounting
to USD970 million, whereas import growth was clearly more modest, at
12% y/y. With imports totalling USD2.980 billion, the trade deficit
for the first three quarters of the year totalled around US2.0
billion. Most important export good groups included mining products,
non-precious metals, and precious and semiprecious stones. Key import
goods consisted of mining products and machinery and equipment,
among other things.
Significance:The latest estimates of Armenian economic performance
testify to persistent strength of economic expansion, while pointing
to some improvement in external balances. Encouragingly, annual
export growth somewhat accelerated from August while import growth
moderated clearly. This probably partly reflects lower growth of
food product imports, due to better domestic harvest than last year,
when agricultural output was badly hit by drought. Export value has
also benefited from high metal prices. While the Armenian economic
recovery recently has been surprisingly strong, it is now likely to
lose momentum. Moreover, risks increase going forward, given that the
global economic outlook is very uncertain, and any marked external
growth slowdown would restrict availability of crucially important
remittance inflows to Armenia.