RUSSIAN EXPERT HAILS ARMENIA’S FLOATING EXCHANGE RATE POLICY, SAYS INFORMATION SUPPORT NECESSARY

ARKA
March 6, 2009

YEREVAN, March 6. /ARKA/. Armenia made a right choice returning to the
policy of floating exchange rate, but the changes should have been
better covered, said Prof. Dmitry Sorokin, first deputy director of
the Economy Institute, RAN (Russian Academy of Sciences).

The expert said Armenia has always followed the floating exchange
rate policy, adding it was strange to hear the country had shifted
to that policy.

"Overall, the policy is efficacious for Armenia with $3bln imports
and $1mln exports," Sorokin said.

In contrast to Russia, the situation in Armenia changed abruptly,
with economic criteria and other factors playing a crucial role,
according to the Russian expert.

"It is difficult to say whether the country needed gradual or abrupt
changes. However, any change must be explained to public. Neither
Russia, nor Armenia explained the situation to people," Sorokin said,
pointing out poor coverage of the situation both in Armenia and Russia.

During the Tuesday special session, the CBA Board decided to return to
the floating exchange rate policy, in view of the ongoing aggravation
of trade conditions and the global financial and economic crisis,
as well as the slowdown in capital inflow.

With the Armenian dram devaluating sharply due to the retrieval of
the CBA floating exchange rate policy, the U.S. dollar exchange rate
this year is expected to range from AMD 360 to AMD 380 per $1.