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Armenia’s Economic Growth in 2020 Will Be Negative Due to COVID-19, New CBA President Says

According to the estimations of the Central Bank, Armenia’s economic growth is forecast to be negative based on the results of 2020 due to the novel coronavirus (COVID-19) pandemic, CBA President Martin Galstyan said at the session of the parliamentary standing committee on financial-credit and budgetary affairs.

"According to our estimations, Armenia’s economic growth based on the results of 2020 will be negative, significantly lower from our previous prediction. The most affected sectors from the pandemic are housing and public food, transportation, tourism agencies, other services and construction. But the pandemic almost had no effect on agriculture", he said, Armenpress reports.

Due to this uncertainty, reduction in private consumption and private investments will be recorded. As it was expected by the action plan, a low inflationary environment has been maintained, the 12-month inflation comprised 1.2% in May. Although there were some uncertainties with the relative pace of restoration of supply and demand, but the CBA’s current analysis shows that the restoration of the demand is taking place at slower rates due to the expected slow pace of external demand and the current uncertainty.

According to the January forecasts of the International Monetary Fund, the global economic growth in 2020 was expected to 3.3%, but in April the IMF already presented its forecasts stating that the impact of COVID-19 on economies will be painful. According to the report presented recently by the World Bank, 5.2% decline is expected.

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