IMF Forecasts 1.5% Economic Growth for Armenia in 2022

• 03.17.2022, 19:23
•  World,  Armenia

An International Monetary Fund (IMF) team, led by Thanos Arvanitis, conducted discussions during March 1–16, 2022 for the sixth review of Armenia’s economic program, which is supported by an IMF Stand-By Arrangement (SBA). The SBA was approved on May 17, 2019 and will expire on May 16, 2022, the IMF said in a statement.

The Armenian economy has continued to recover, posting 5.7 percent growth in 2021, and continuing to grow strongly in early 2022. Annual CPI inflation has steadily declined to 6.5 percent in February supported by monetary policy tightening. Fiscal policy helped to cushion the impact of the shocks on the economy in the last two years, but remains anchored on the broader objective of debt sustainability, and tax policy and administration reforms continue to broaden the tax base. The fiscal deficit is estimated to have narrowed to 4.7 percent of GDP in 2021, largely on the back of lower government spending. The external position has strengthened, especially in 2021, as the current account deficit narrowed during the Covid-19 pandemic while remittances stayed strong, and the Eurobond issuance and the SDR allocation added to international reserves. The banking system has remained adequately capitalized and liquid, and asset quality has improved.