ARMENIAN TRADE DEFICIT REMAINS DEEP IN FEBRUARY
by Venla Sipila
Global Insight
March 25, 2008
According to the Armenian National Statistical Service, Armenia’s
exports for January-February totalled 44.2 billion dram ($143US.6
million), rising by 6.2% year-on-year (y/y), ARKA News reports. At
the same time, imports soared by 30.2% y/y, reaching $543US.4
million. Thus, the trade balance posted a deficit of $399US.8 million
for the two-month period. Further, it was reported that exports without
precious stones rose by 9.3% y/y, amounting to $123US.5 million,
while imports soared by 34.6% y/y totalling $522US.3 million. Thus,
the January-February trade gap excluding trade in precious stones
came in at $398US.8 million.
Significance:Armenia’s trade deficit for 2007 as a whole came in at
over $2US billion, widening by a massive 73% compared with 2006 (see
Armenia: 25 January 2008: ), and this year has not started on a very
promising note regarding the possibility of a turnaround. Indeed,
the trade gap is expected to remain fairly wide over this year, as
export demand stays weak and the sector to an extent remains dependent
on the diamond trade. In addition, import growth is likely to remain
vigorous. However, import growth should moderate somewhat, together
with overall growth and domestic demand. Then again, domestic demand
seems to be holding up more persistently than previously thought, and
this is further reflected in persistently very high import growth. In
any case, the Armenian trade deficit should gradually moderate as a
percentage of GDP over the coming years.