PREMIER: ADDITIONAL CASH INJECTIONS IN ARMENIA’S CONSTRUCTION SECTOR CAN MITIGATE ADVERSE IMPACT OF GLOBAL CRISIS

/ARKA/
July 1, 2009
YEREVAN

YEREVAN, July 1. /ARKA/. Additional cash injections in Armenia’s
construction sector will mitigate adverse impact of the global crisis
on the country’s economy, Armenian Prime Minister Tigran Sargsyan said
Wednesday at the ceremony of credit agreement signing by European
Bank for Reconstruction and Development and Elite Group, Armenian
construction company.

"Important is that EBRD believes that construction programs will
be successful and keeps crediting them despite adverse impact of
the crisis.

Credits will help us to mitigate consequences of the crisis", he said.

Under the agreement, European Bank for Reconstruction and Development
lends $5.5 million to Elite Group and provides â~B¬130,000 in grant
to encourage energy-saving innovations.

Sargsyan stressed the importance of the agreement saying it is
significant for several reasons.

First, this is the bank’s second cash injection in Armenian economy.

Earlier, the EBRD extended unprecedented credit to Armenia’s energy
sector.

The premier said that $5.5 million would be given to one of the
largest construction companies in Armenia.

On July 4, Armenian Government provided budget guarantee of 2.5 million
to Elite Group to enable the company to complete construction of some
buildings in Yerevan.

Tigran Sargsyan attache s special importance to governmental programs
in construction area, since construction sector’s share in GDP is
greatest, and construction sluggishness affects all the sectors of
the national economy.

In his words, Armenian Government makes every effort to pump funds
into construction.

He said that the government must do whatever necessary to attract
funds.

"Important is to restore private sector’s confidence in construction",
the premier said.

National Statistical Service of Armenia says 15.7% economic decline
was recorded in the country in Jan-May 2009, compared with the same
period of the previous year.

According to the statistical report, GDP in current prices amounted
to AMD 839356.6 million in Jan-May 2009, and GDP index-deflator was
101.4%, compared with the same period a year earlier.

Armenian construction sector’s 56.6% decline in Jan-May 2009 drove
GDP 10.3 percentage points down, while at the same period of 2008,
construction added 2.9 points to GDP.

The sector’s share in GDP was 10.8% in Jan-May 2009.