DUBAI SYNDROME CONSEQUENCES DON’T THREATEN ARMENIAN ECONOMY

PanARMENIAN.Net
08.12.2009 14:53 GMT+04:00

/PanARMENIAN.Net/ Armenia shows interest in the processes occurring
in UAE, one of RA’s main trade partners, Ph.D. Candidate in Economics
Samvel Avagyan said.

When commenting on information that Dubai World state company requested
its creditors to freeze its debt till May 30, 2010, Samvel Avagyan
noted that UAE total debt comprises USD 80 billion, which exceeds
the county’s GDP. At the same time, the expert added that another
debt payment of the company is due until December 14. Still, after
November 26 the company announced its insolvency.

"A 3-4% slump was registered at international stock market,
constituting the largest slump in 2009. At present, the situation
at US and China’s stock markets became stabilized, what cannot be
said about European stock markets, with them being main investors of
major programs and clients for real estate purchase in Arab Emirates,"
he said.

Arabian crisis is caused by too posh, yet economically unjustified
investment programs, according to Avagyan.

Nevertheless, he noted, the Dubai syndrome consequences do not threaten
the economy of Armenia, having no investment partnership with Dubai
World. Still, some indirect influence is possible, considering
increasing dollarization in Armenia.

Besides, the second surge of crisis is possible, which could influence
Armenia’s economy, specifically, real estate sector. As the expert
explained, Dubai Syndrome should be resolved at local level, allowing
it to prevent a new wave of crisis.