Economic activity in Armenia increased by 14.3% year-on-year in January-March 2024, according to the Weekly Macroeconomic Review by analysts of the Eurasian Development Bank (EDB).
As stated in the report, the industry, which grew by 30.4%, continues to account for a significant portion of economic activity. According to the bank's data, the share of industry accounted for about 5.8% of the growth structure in the first quarter. This was "due to the expansion of production and export of gold jewelry," EDB analysts note.
The increase in economic activity was also provided by the trade sector (+26.5% y/y) and services (+5.0% y/y). "Goods exports increased by 2.7 times y/y, while imports increased by 75.8% y/y in January-March, mainly due to the expansion of foreign trade and processing of gold products," the report said.
Earlier, BMG reported that experts note that the sharp increase in economic activity is largely driven by the strong performance of the industrial sector, which in turn is explained by the re-export of Russian gold and precious stones from Armenia to the United Arab Emirates and Hong Kong.
This raises concerns about the sustainability and long-term nature of economic growth, as it is largely dependent on external factors and its stability may be threatened by changes in external conditions.
However, the sharp rise in economic activity was recorded in conditions of deflation. In March, prices in the consumer market decreased by 1.2%. This decrease corresponds to deflation on a quarterly basis.
