Armenia's Economic Pulse

[Haykakan]

Re: Armenia's Economic Pulse

The debt/gdp ratio is a important number to follow. Debt can be big but if the GDP is growing faster then the debt then its not so bad. I think Armenia has done well considering the sanctions situation and the blockade. Having said all that it is so annoyingly old to keep saying dematsek hayer..

[Mher]

Re: Armenia's Economic Pulse

Public debt is at $4.81 Billion
GDP is around $11.12 Billion
public debt is at 43.33% of GDP


A year ago the debt was 8.4% lower, so it stood at $4.41 Billion
GDP was 3% lower, so it was at $10.796 Billion
meaning debt was at 40.85% of GDP

just a 2.48% increase is pretty good news given the significant amount of borrowing this year, and the many doom and gloom articles about government debt


Armenia’s total public debt dropped by 0.3% in late November to $4.813 billion

YEREVAN, January 8. / ARKA /. Armenia’s total public debt at the end of November 2015 stood at $4.813.4 billion, a decrease of 0.3% or $13.5 million from the previous month, and 8.4% higher from the beginning of the year, the National Statistical Service (NSS) said.

According to the NSS, the external debt at the end of November 2015 was 1% down from October standing at $4.061.8 billion. Of that amount $3.578.8 billion were owed by the government, a decline of 1.3%, while the Central Bank's debt stood at $482.9 million, increasing by 1.2% from the previous month).

The internal debt was worth $751.5 million, an increase of 4%. Of that amount about $651.6 million were owed to resident holders of government bonds.

The debt to buyers of foreign currency denominated government bonds stood at $97.9 million. Government’s guarantees were worth $2 million-0-

http://arka.am/en/news/economy/armenia_s_total_public_debt_dropped_by_0_3_in_late_november_to_4_813_billion/

[gokorik]

Re: Armenia's Economic Pulse

Not a very significant development but good news

Iraq Eyes More Armenian Imports Due to Tensions with Turkey

YEREVAN (Azadutyun)— Iraq’s government is reportedly considering importing cooking oil from Armenia instead of Turkey because of its mounting political tensions with Ankara.

The Reuters news agency on Thursday quoted an Iraqi official as saying that that the government will gradually cut imports of Turkish cooking oil that it supplies for free to the population under a food rationing program. “The plan is to replace Turkish oil with locally produced oil and oil from other countries,” the official said.

The measure is meant as a protest against the deployment of Turkish troops in northern Iraq.


http://asbarez.com/143670/iraq-eyes-...s-with-turkey/

[HyeSocialist]

Re: Armenia's Economic Pulse

Armenian IT Boom Continues

Armenia’s information technology (IT) sector continued to grow rapidly in 2015, creating many new jobs and generating about 5 percent of Gross Domestic Product, according to government data.

Preliminary estimates by the Armenian Economy Ministry show that the combined output of some 450 IT firms operating in the country rose by nearly 20 percent to a level equivalent to roughly $550 million.

Ministry officials dealing with IT say that the sector now employs 15,000 or so people -- 13,000 of them software developers and other hi-tech engineers. They put the number of skilled specialists working in the burgeoning industry at 11,600 a year ago.

The IT industry expanded by an average of 22 percent annually from 2008-2014 , making it the fastest-growing sector of the Armenian economy. It accounted for only 1.7 percent of GDP in 2010.

The sector continues to be dominated by local subsidiaries of U.S tech giants like Synopsys, National Instruments, Mentor Graphics and VMware. Several other multinational corporations have established or stepped up their presence in Armenia in the past year.

Armenia - Taiwan's D-Link Corporation inaugurates a research and development center in Gyumri in the presence of President Serzh Sarkisian, 25May2015.
Armenia - Taiwan's D-Link Corporation inaugurates a research and development center in Gyumri in the presence of President Serzh Sarkisian, 25May2015.
Oracle, the world’s second largest software manufacturer, officially opened a branch in Yerevan in November 2014, while Taiwan’s D-Link Corporation, a leading manufacturer of computer networking equipment, inaugurated its newly constructed research and development center in Gyumri in May 2015.

Growth in the export-oriented sector is also increasingly driven by homegrown Armenian companies. More than 250 of them have been set up since 2007. Some have already gained international acclaim.

One such startup, PicsArt, solidified in 2015 its status as one of the world’s most popular mobile photo editing and sharing applications. The Yerevan-based company boasting 60 million monthly users attracted $10 million in funding from Sequoia Capital, a U.S. venture capital firm, before being included on the “Forbes” magazine’s 2015 list of the world’s 50 “hottest startups.” According to “Forbes,” PicsArt is now valued at $250 million, a huge figure by Armenian corporate standards.

Another Armenian mobile application developer, ARLOOPA, was among more than 100 startups from around the world that took part in the 2015 Augmented World Expo held in California in June. ListHunt.co, a U.S. IT news website, rated ARLOOPA among the 9 best participants of the prestigious annual event.

An older Armenian firm, Triada Studio, also made headlines in June after its sophisticated puzzle game called Shadowmatic won one of the Apple corporation’s annual Design Awards. Apple also added Shadowmatic to its App Store distribution platform.

Karen Vartanian, chairman of Armenia’s Union of Information Technology Enterprises (UITE), singled out the growth of Armenian-owned firms when he discussed the sector’s 2015 performance on Monday. Speaking to the A1+ TV station, Vartanian said that they are increasingly developing their own products instead of seeking outsourcing deals with bigger Western companies. “I think this trend will continue in 2016,” he added.

The Armenian government also recognizes the importance of startups for maintaining the high rates of IT growth in the years ahead. In December 2014, it pushed through the parliament a bill that introduced significant tax breaks for new IT firms employing up to 30 people.

The tax breaks, valid until the end of 2019, are granted on a case-by-case basis by a special commission comprising not only government officials but also IT industry executives. According to Naira Nikoghosian, head of an Economy Ministry division dealing with the sector, 61 startups qualified for them in the course of 2015.

“We will strive to make sure that these tax breaks are extended beyond 2019,” Nikoghosian told RFE/RL’s Armenian service (Azatutyun.am). She argued that the number of newly registered firms has increased substantially since December 2014.

IT executives say that the sector would have grown even faster had the quality of education at the computer science departments of Armenian universities been adequate. Most of their graduates are not qualified enough to work for IT companies without undergoing additional training. There are still an estimated 2,000 job vacancies in the sector, a highly unusual phenomenon for a country that has long suffered from double-digit unemployment.

The UITE has been trying to address this problem with extracurricular robotics and other IT classes organized by it in about 80 public schools across the country since 2008. Vartanian insisted that most students attending them will be skilled enough to work for IT firms immediately after finishing school.

Thousands of other Armenian schoolchildren, aged 12 and over, are enrolled in Yerevan’s Tumo Center for Creative Technologies, mainly studying computer programming, robotics and animation. The state-of-the-art center, founded by U.S.-Armenian philanthropist Sam Simonian in 2011, opened branches in Gyumri and Nagorno-Karabakh’s capital Stepanakert in 2015. A Tumo branch is also expected to open its doors in Vanadzor, Armenia’s third-largest city, in 2016.

http://www.azatutyun.am/content/article/27457893.html

Time to pick up the pace, learn to code and some graphic design, and go join in on the boom.

[Mher]

Re: Armenia's Economic Pulse

Sarkisian Touts ‘Macroeconomic Stability’ In Armenia

Emil Danielyan
Հրապարակված է՝ 24.12.2015

President Serzh Sarkisian has praised Armenia’s macroeconomic performance in 2015, arguing that the domestic economy has continued to grow and the national currency has only slightly depreciated over the past year despite adverse external influences.

“The key indicators of economic developments in the first eleven months of 2015 suggest that thanks to our efforts we have succeeded in making our country’s economic environment practically immune to major shocks resulting from negative trends coming from the outside world,” he told leading Armenian businesspeople at a year-end reception hosted late on Wednesday.

Sarkisian argued that the Armenian economy is on course to expand by more than 3 percent this year on the back of major production gains in agriculture and manufacturing, contrary to gloomy forecasts made by international lending institutions this spring. He said the growth has helped to push up the average monthly salary in the country by 8.5 percent to roughly 185,000 drams ($385). Year-on-year inflation stood at less than 2 percent in November, he stressed.

Sarkisian went on to note the relatively stable exchange rate of the Armenian dram. The national currency weakened by 17 percent against the U.S. dollar in November-December 2014 amid a sharp fall in dollar-denominated remittances from Armenian migrant workers in Russia. The dram has only slightly depreciated since January despite a continued fall in oil prices that plunged the Russian economy into recession.

“Of course, many countries would be happy to have such indicators, but our figures are not high in absolute terms and we therefore cannot be satisfied with them,” cautioned the president. “Armenia needs faster, long-term and sustainable growth that would not be vulnerable to negative external factors.”

Citing the economic situation in Russia, Armenia’s leading trading partner, the International Monetary and the World Bank said early this year that the Armenian economy will barely grow or may even contract in 2015. Both institutions revised their projections upwards in the following months.

The head of the World Bank office in Yerevan, Laura Bailey, said on Wednesday that Armenia’s Gross Domestic Product will increase by at least 3.2 percent in real terms in 2015. She forecast that growth will slow down to 2.2 percent in 2016.

The Armenian government set the same growth target in its 2016 budget proposal approved by the parliament two weeks ago. It says that that the slower growth will translate into a slight drop in state revenue next year. And although government spending is projected to rise by over 5 percent next year the state budget does not envisage increases in public sector salaries, pensions and poverty benefits.

Prime Minister Hovik Abrahamian admitted last month that the socioeconomic situation in Armenia is unlikely to markedly improve next year. “In view of tense geopolitical developments, promising an immediate betterment of all aspects of social welfare would be a populistic but not honest approach,” he told lawmakers in Yerevan.

Opposition politicians and other critics of the government say that economic conditions have actually worsened this year despite the official growth figures. In particular, they point to a 7 percent drop in retail and wholesale trade recorded by the National Statistical Service (NSS) in January-November.

This explains why imports of goods to Armenia plummeted by over 26 percent in the same period. The NSS also reported a nearly 5 percent fall in Armenian exports. That was mainly attributable to the collapse of the Russian ruble and decreased international prices of copper, molybdenum and gold, a key Armenian export.

http://www.azatutyun.am/content/article/27447360.html

you would have a real hard time convincing the average person in Armenia that there is any good economic news at all, but then again the average taxi driver doesn't really understand macroeconomics. A year ago it seemed like the bottom was about to fall out on our tiny republic and that Armenia might be facing economic collapse. It seemed a little ridiculous to trust the government's economic forecast of 4-5% growth versus every international institution which all predicted a recession. I don't know how much credit the government gets here. There was a lot of borrowing, and we got fortunate with the climate and the agriculture production this year, but it almost seems miraculous to see where things stands, compared to what was expected a year ago on this week after the dram had dropped 25% in a matter of days

[Shant03]

Re: Armenia's Economic Pulse

Mo Money, Mo Problems

http://www.armradio.am/en/2015/12/23/wb-approves-us55-million-loan-for-armenias-local-economy-development-project/

WB approves US$55 million loan for Armenia’s Local Economy Development Project

The World Bank Board of Executive Directors approved today a US$55 million loan for the Local Economy and Infrastructure Development Project (LEIDP) for Armenia to improve infrastructure services and institutional capacity for increased tourism contribution to the local economy in five selected regions of the country. Developing a rich variety of tourism destinations across the country in a sustainable way is part of the Government’s vision of improving the maintenance of Armenia’s natural and cultural heritage while also stimulating regional economic activity.

The World Bank helped the Government in 2014 to assess the regional development disparities and opportunities and prepared a Tourism Strategy for the country’s South Corridor. The analysis has identified opportunities for regional development by studying the profile of each region (marz) in Armenia and identifying key policy and investment needs in the most competitive sectors that drive private sector-led growth and job creation, most notably tourism, agro-tourism and agri-business. It also recommended an integrated approach to development of tourism corridors and circuits for diversifying and improving Armenia’s tourism products, which could increase spending and deliver a more robust tourism-led local economic development.

“As demonstrated around the world, with careful strategic planning and relatively modest public investments, tourism activities can be nurtured into a critical source of economic and employment growth at the local level,” says Laura E. Bailey, World Bank Country Manager for Armenia. ”I would like to highlight that one of the major strengths of the proposed project is that it motivates the communities to preserve their unique Armenian cultural heritage and helps benefit from integrating tourism in wider local economic development.”

With over 4000 historical monuments throughout the country dating from pre-historic to Hellenistic and early Christian eras – three of which are UNESCO World Heritage Sites – Armenia is often referred to as an open air museum. The Project activities are expected to benefit the residents, tourists and enterprises in three marzes in the south – Ararat, Vayots Dzor and Syunik, and two marzes in the north – Kotayk and Lori.

More specifically, the first component – Heritage Hub Regeneration and Tourism Circuit Development – will finance urban regeneration activities in the old towns of Goris and Meghri, and in the heritage villages Areni, Tatev and Tandzatap. This includes restoration of public infrastructure, building facades and roofs, public spaces, museums, access roads, water and sanitation, drainage and street lighting.

This component will also finance an integrated approach to cultural heritage preservation and improved site management plans of the most attractive cultural and natural heritage sites located along the main tourism circuit in Armenia: Garni (Temple and Gorge), Geghard Monastery, Dvin Museum, Khor Virap Monastery, Areni marketplace and cave, Mozrov cave, Zorats Qarer (Karahunge/Stonehendge), Khndzoresk and the two UNESCO Sites of Haghpat and Sanahin.

“In addition to the expected growth in the tourism sector and of under-developed areas, this project will enable public infrastructure to attract private investments. It will attract private entities in Project areas that demonstrate interest and capacity to invest in tourism or agribusiness through participating in rehabilitation of complementary public infrastructure to ensure the viability of their investments,” says Ahmed Eiweida, World Bank Task Team Leader of the Project.

The second – Institutional Development component – will increase the institutional capacity and performance of the Development Foundation of Armenia (DFA), the Ministry of Economy (MoE), responsible for overall coordination and policy support of the Project, the Historical and Culture Heritage Protection Agency (HCHPA), and the Armenia Territorial Development Fund (ATDF), as the implementing entity, to carry out tourism related activities at the various levels in a sustainable manner.

The first year investment program will capture numerous activities for improvements at Khor Virap Tourism Facility; Garni Gorge with rehabilitation of 1.6 km road leading from Garni Temple to the Stone Symphony monument, located in Azat River Gorge; Zorats Qarer (Stonehenge) Tourism Facility with improvement of the road leading to the monument.

Total financing of this project is US$68 million, of which US$13 million will be the Government’s contribution. The World Bank will provide a US$55 million IBRD loan of variable spread with a 14.5-year grace period and the total repayment term of 25 years.

[Haykakan]

Re: Armenia's Economic Pulse

ARMENIA AND CHINA LOOKING FOR SCHEMES TO FINANCE CONSTRUCTION OF RAILWAY LINK TO IRAN

YEREVAN, December 17. /ARKA/. Deputy transport and communications
minister Artur Arakelyan said today that Armenia and China are
discussing possible financing schemes for the construction of a
railway link from Armenia to Iran.

He said both countries have been looking into ways of intensifying
bilateral relations and boosting trade, discussing also China's
possible participation in the construction of the railway that would
allow direct delivery of goods from China to Armenia.

He said the importance of diversification of cargo transportation
routes is recognized both by the governments of Armenia and Iran.

According to the deputy minister, the railway project was discussed
with the Chinese side that expressed interest in its implementation.

He said work is underway to develop a financing scheme for the project,
estimated to cost $3-$4 billion.

The Armenian government upheld the 300-kilometer railway construction
project on August 7, 2014. The project implies construction of
64 bridges of total extent of 19.4 kilometers, 60 tunnels (102.3
kilometers) and 27 stations as part of the infrastructure. The
construction is expected to be completed in 2022. Annual freight
traffic will be 25 million tons.

The project of the railroad has been developed by China's CCCC
International, and Chinese banks have expressed willingness to finance
60% of the project.

According to Armenian National Statistical Service (NSS), the trade
with Iran in the first 9 months of 2015 dropped by 4.4% from the year
earlier to $104.4 million.-0-

http://arka.am/en/news/economy/armenia_and_china_looking_for_schemes_to_finance_construction_of_railway_link_to_iran/

[Haykakan]

Re: Armenia's Economic Pulse

MINISTRY SIGNS AGREEMENT WITH CHINESE COMPANY ON CONSTRUCTION OF SECTION OF NORTH-SOUTH TRANSPORT CORRIDOR

YEREVAN, December 9. /ARKA/. Armenia's ministry of transport and
communications signed today an agreement with Chinese CinoHydro
Corporation on construction of a section of North-South Transport
Corridor. The section is stretching from Lanjik community to Armenia's
second largest town of Gyumri. The cost of this section is estimated
at 74 million euros, the ministry said in statement today.

The Chinese company is to build this 27.5 km-long section as part of
the 3rd tranche of the investment program.

The section's construction will be financed by a loan from the European
Investment Bank, a European Commission grant and Armenian government's
co-financing. The construction is to kick off in 2016 March and end
in 3 years.

Under the agreement, the Chinese company will use locally-manufactured
building materials. Some 70% of labor force will be Armenian workers,
the ministry said.

The goal of North-South Transport Corridor project is to upgrade
Armenia's main corridor road as part of a broader thrust to improve
connectivity, and boost trade, growth and livelihood opportunities
in the Caucasus and Central Asia sub-regions.

Funds are being released by the Asian Development Bank periodically
through a multitranche financing facility. The transport corridor
will stretch from the southern Armenian town of Meghri, on the border
with Iran, to Bavra in the north on the border with Georgia. The
North-South transport corridor will enable Armenia to mitigate the
effects of the blockade imposed by Azerbaijan and Turkey.

Currently the construction of the road is underway from Artashat
to Ashtarak and from Ashtarak to Talin. The ministry plans also the
implementation of separate smaller projects at various sections of the
road in order to end the construction both in southern and northern
directions by 2019.-0-

http://arka.am/en/news/economy/ministry_signs_agreement_with_chinese_company_on_construction_of_section_of_north_south_transport_co/

[Haykakan]

Re: Armenia's Economic Pulse

Here is a interesting article. http://www.globalresearch.ca/the-imf...russia/5494751
The implications are very important as this sets a precedent of nonpayment of debt.

[Shant03]

Re: Armenia's Economic Pulse

Russia, Iran eye gas swap deal for deliveries to Armenia: Gazprom

The Russian energy giant Gazprom is in talks with Iran over gas exchange operations for gas supplies to Armenia, CEO Alexey Miller said, Sputnik News reports.

On Tuesday, Miller met Georgian Energy Minister Kakhaber Kaladze for negotiations.

“Yes, we did discuss this issue, currently we are working on the issues of exchange operations with our Iranian colleagues,” Miller said, when answering a question whether he and Kaladze discussed supplies of gas to Armenia from Iran.

At the moment, the Russian gas is supplied to Armenia via Georgia.

In November, Iranian Petroleum Minister Bijan Zangeneh said Tehran was already in talks with Moscow on oil and gas swaps agreement.