REDUCTION OF DOLLARIZATION TO BE STRATEGY OF ARMENIAN CB IN NEAR 3 YEARS

Arka News Agency, Armenia
June 5 2006

YEREVAN, June 6. /ARKA/. Reduction of dollarization in the country
will become the strategy of the Central Bank of Armenia in the near
three years, Chairman of the Central Bank of Armenia Tigran Sargsyan
told reporters.

According to him, dollarization of economy decreases Armenia’s credit
rating. “One of the signals to reduction of dollarization will be
AMD revaluation. That is why economic entities and Armenian citizens
should give preference to AMD,” he said.

According to Sargsyan, reduction of dollarization of economy will
result in the improvement of Armenia’s economic situation and growth
of the independent credit rating of the country.

At the same time, Sargsyan pointed out that the Central Bank of Armenia
urges Armenian citizens to plan incomes and expenses in AMD and watch
the prices, not the exchange rate.

“The thinking of the Armenian population is extremely dollarized. We
need radical changes. We need to understand: if we keep our savings
in USD it means that we support the US economy,” he said.

Sargsyan said that the fact that the Armenian population does not
keep their savings in AMD means delaying the country’s economic growth.

4.35% AMD revaluation against USD was recorded in Armenia in May
2006. During the first five days AMD increased by more 0.28%. As of
June 5, the CBA set USD 1 – AMD 426.37 exchange rate.

As compared to the beginning of 2006 AMD revaluated by 5.75%.