The Asian Development Bank has revised upwards the growth forecast for Armenia in fiscal year 2021 to 5.2%, from 1.8% predicted earlier, according to a fresh report published on Wednesday, September 22.
"Armenia’s economy expanded by 4.9% in the first half of 2021, with gains in all sectors and in both consumption and investment. This marked recovery from a low base but also from multiple economic shocks in the second half of 2020," the report said.
"Its growth projections are thus revised up from 1.8% to 5.2% for 2021 and from 3.0% to 3.5% for 2022."
On the supply side, all sectors contributed to growth. Agriculture expanded by a strong 7.1% on higher crop production. Services grew by 5.3%, with increases in trade, transportation, food, and administrative and real estate services that outstripped declines in recreation, accommodation, and education services. Construction grew by 5.5%, supported by public infrastructure and private construction. Industry grew by 1.3% as gains in mining and quarrying, electricity generation, and water and waste management more than outweighed a 4.4% decline in manufacturing.
On the demand side, private consumption expanded by 5.4% on higher remittances, and public consumption grew by 3.2% with higher spending on social services. Investment, measured by gross fixed capital formation, surged by 9.5% on higher government and private capital spending. With the economy recovering faster than anticipated, this Update raises growth projections for 2021 and 2022.
