The Messenger, Georgia
July 4 2007

Armenian Economy Growing, Inflation a Risk

By M. Alkhazashvili
(Translated by Diana Dundua)

Armenia’s economic indicators are looking better than other states in
the region, although they are also facing inflation increases, stated
IMF representative Marta Castello-Branco in Yerevan July 2, according
to the news agency Regnum.

So far this year, economic growth and tax revenues are exceeding
predictions, while inflation is under control-for now.

In 2007, state tax incomes will amount to 15.2 percent of GDP, writes
Regnum. Inflation is beginning to rear its head-costs on wheat are
rising, and budget expenses will increase in the second half of the
year.

To ensure healthy economic growth with low inflation, Castello-Branco
said, Armenia must continue with structural reforms, improving tax
administration and weeding out corruption.

Research has revealed that the shadow economy in Armenia is worth 30
percent of the real economy.

The national currency, the AMD, is growing stronger. From the
beginning of the year up to July 1, the AMD rose from 357 to the
dollar to 338. Despite harm done to exports, the IMF says there’s no
serious concern, reports Regnum.