Armenia's GDP may decline by 1 billion US dollars in 4th quarter of 2020 - FORECAST
In January-August 2020, Armenian economy decreased by 6.4 percent. In Armenia, included in the list of countries implementing the most ineffective fight against the coronavirus (COVID-19) pandemic, in the first 8 months of this year, exports and imports have decreased, and the economic downturn has intensified.
According to the Statistical Committee of Armenia, amid the coronavirus crisis, the industrial sector, which was previously the driving force behind the country's economic growth, has faced stagnation. In the first eight months, the construction sector recorded a decline of 19.1%, trade - 11.5%, and the service sector - 10.8%. It can be predicted that Armenian economy is going to face the biggest catastrophe. So, the Armenian side, which violated the ceasefire and invaded Azerbaijan on September 27 this year, faced a counterattack by our country. The actions of the Azerbaijani army to liberate the lands and punish the enemy became a serious challenge for Armenia.
The evaluation of the Center for Analysis of Economic Reforms and Communication shows that Armenia has lost military equipment and ammunition worth US 2 billion US dollars. However, the country's losses cover not only military equipment and ammunition. The continuation of the war also increases the losses of the Armenian economy. According to the information provided, the occupying state has announced mobilization and started the process of recruiting citizens into the army. Complying with initial information, Armenia is trying to mobilize 210 thousand of its citizens and send them to the occupied territories. If number of economically active population of Armenia is 913 thousand people, this means that 23 percent of them will be out of work and go to war. The matter is that, the mobilized persons do not work and do not create added value. As a result, during the 4th quarter of 2020, the decline in Armenia's GDP will increase. Such course of processes increases the likelihood of economic recession in Armenia for the next year as well. It should be noted that in 2019, Armenia's GDP amounted to 6569 billion drams, or about 13.7 billion US dollars. Following the country's statistical information, 30.4 percent of GDP, or 1998.7 billion drams (4.2 billion US dollars) accounts for the 4th quarter.
We can predict that in the 4th quarter Armenia's GDP will face serious decline precisely under the influence of the ongoing war. According to our initial calculations, if 210 thousand citizens of Armenia are mobilized and sent to fight, then during the 4th quarter of 2020 the level of GDP may decrease daily by 10.7 million US dollars, or by 1 billion US dollars for the entire quarter. It should also be noted that when the war ends, it would take a long time to return citizens who were called to serve back to production. The resumption of suspended production will face new challenges (loss of customers, etc.).
Our best scenario calculations demonstrate that against the loss of workforce in economic sectors and corresponding reduction in capital, production capacity of Armenia’s economy will weaken. As a result, due to the aggressive war, daily GDP will increase by 3,4 million US dollars. According to our worst scenario calculations, the situation in Armenia will become even more depressing. As we can see, the calculations for two scenarios (good and average) show that in any case, war will lead to the collapse of the Armenian economy. We forecast that within two weeks of the war, Armenia’s GDP as a whole will decrease within 47.6-149.8 million US dollars.
Our calculations show that against the background of these events, a reduction in exports will be inevitable for Armenia. For information, it is worth noting that the value of Armenia's exports for 8 months of this year amounted to 1.57 billion US dollars and exports decreased by 6 percent. We should also take into account the news about the suspension of work in the export-oriented mining industry in Armenia. This means that the occupational war will be succeeded by an acceleration of exports reduction, and as a result, the deficit in Armenia's trade balance will increase.
On the other hand, the reduction in domestic production will force Armenia, which has limited foreign exchange resources, to increase imports, especially food.
If Armenia does not back down from its occupation policy and wages a longer war, then the country will face even more drastic economic consequences. Along with 2020, Armenia will experience serious economic problems in 2021 as well. Consequently, these losses may increase with the intensification of the coronavirus pandemic and war. As a result, this will lead to the increase of the poverty of the population and bankruptcy of the state.
Russia records 28 145 coronavirus cases over past day
Azerbaijani Defense Minister meets with Commander of the peacekeeping forces deployed in the Nagorno-Karabakh region of Azerbaijan
Ex-Liverpool goalkeeper Andy Lonergan joins Stoke City on short-term deal
SOCAR’s proven gas condensate reserves increases by 26%
Examples of material culture belonging to ancient time found in Aghdam
Technical and economic justification works launched for the supply of gas to the liberated territories of Azerbaijan from occupation
Number of coronavirus cases grows by 1,277 in a day in Armenia, 26 deaths recorded
Japan considers banning the sale of fuel vehicles in 2035 to promote zero greenhouse gas emissions
Moody's: Azerbaijain to be first to cover loan losses in CIS
Over 1,000 Chinese researchers leave US amid tech theft crackdown
Georgia reports 45 coronavirus related deaths over past day
Social-psychological services provided to wounded servicemen and those who suffered from Patriotic war
5.2-magnitude quake hits 120 km ESE of Antofagasta, Chile
Grounded 737 Max could take first step toward being cleared to fly this week
OPEC + intends to gradually resume oil production
Azerbaijani oil prices approach USD 49
Prominent Azerbaijani Advocate Adil Ismayilov dies
5.0-magnitude quake hits Turkey
Australia plans to start COVID-19 vaccination in March 2021
Ministry of Defense releases video footage of the Lachin city - VIDEO
US oil reserves decrease - OFFICIAL
Two people died in central Moscow hospital fire
Oil prices continue to decrease
US records 2nd-highest daily death count ever
Former French President Giscard d'Estaing dies at 94
OPEC+ resumes talks on 2021 oil policy amid disagreements
France: COVID-19 infections spike midweek
The demining operation of the road planned to construct to Sugovushan completed
Turkey expects COVID-19 vaccines to arrive after Dec 11
U.S. says U.N. COVID-19 meeting is stage for Chinese 'propaganda'
Iran okays plan to speed nuclear program
World needs more than 3 or 4 vaccines: UN health body
The Foreign Ministers of Azerbaijan and Russia had a telephone conversation
Turkey reports nearly 32,000 new COVID-19 cases
An earthquake hits the Caspian Sea
Turkey sees its future in EU: Top diplomat
Azerbaijani MoD: Other logistic support assets brought for the peacekeeping contingent were delivered to the destination point - VIDEO
SOCAR Polymer inreased export up to 25%
Azerbaijan Defense Ministry expressed condolences to the Iranian side
First Vice-President of the Brazilian Federal Senate sends letter to Azerbaijani President
Brazil bank heist: Armed men take hostages in attack on Cametá
Agenda of special session of UN GA on COVID-19 to be held at initiative of Azerbaijani President announced
EU Commission ready for new cooperation with US
WHO recommends that people wear masks in shops, workplaces, schools if ventilation isn't adequate
Center for Analysis of Economic Reforms and Communication: Military equipment losses of Armenia amount to 3.8 billion dollars - PHOTO
Boris Johnson stresses COVID vaccination should be voluntary
Ukraine reports over 13,000 daily COVID-19 cases
Peskov: Russians first to get domestic vaccines
BioNTech: US, EU vaccine approval possibly in mid-December
Chairman of the Confederation of Azerbaijani Diaspora Organizations of Russia adressed a letter to İlham Aliyev
Liberation of Lachin from occupation celebrated in Takhtakorpu - VIDEO
Azerbaijani flag raised up in the liberated from occupation Lachin region - VIDEO
Units of the Azerbaijan Army entered the Lachin region - VIDEO
The other logistic support assets for the peacekeeping contingent were delivered - VIDEO
Armenians target Azerbaijan's residential settlements, civilian population, and civilian facilities - PHOTOSESSION
Azerbaijani MP suggests to establish shelters for beggars
Azerbaijan commemorates Khojaly genocide - PHOTOSESSION
14 years pass since establishment of the Ministry of Emergency Situations: They always come to your aid in any difficult moments - PHOTOSESSION - VIDEO
First Vice-President Mehriban Aliyeva attended opening ceremony of rebuilt Azerbaijan pavilion at Exhibition of Achievements of National Economy in Moscow - UPDATED
UEFA banned Nurlan Ibrahimov from football for life
Azerbaijani Parliament adopts a statement protesting the resolution adopted by the French Senate - FULL TEXT
Hikmat Hajiyev: "Diplomatic corps have witnessed consequences of Armenia's brutal rocket and artillery attacks" - VIDEO
Azerbaijan's State Security Service brought Lebanese terrorist mercenary to justice who fought in Karabakh - VIDEO