Head of World Bank Yerevan Office Predicts a 1.5-Percent GDP Growth in 2010
At a press conference today Head of the WB Yerevan Office Aristomene Varoudakis presented the analysis of the 18.2 percent economic decline in Armenia in 2009, and the economic prospects of the country in 2010.
The Head of the World Bank’s Yerevan Office warns that in 2011 the foreign debt of Armenia will reach 50 percent of the GDP, taking into consideration the fact that this year along with the two-digit economic decline registered in the country, the state debt has totaled 37 percent of GDP, whereas before it was 13 percent.
According to him, an abrupt fall was registered in Armenia this year, because the economy of the country is based on two main sectors – construction and mining. As a result, the most evident decline was registered in the sphere of social maintenance.
Despite these indices, Varoudakis feels positive about 2010. “If everything is well organized, we believe that a 1.5-percent GDP growth will be registered in 2010, and the inflation will be moderate, not exceeding 5.5 percent,” said Varoudakis.
He mentions three conditions for reaching this result and overcoming the crisis. The first is the creation of a competitive economy. “It is necessary to take into consideration that the investors of the countries overcoming crisis, became more scrupulous while choosing a country; and if Armenia does not get rid of oligopolies, and if there is no fair competition here, investors will hardly come to Armenia,” he said.
Varoudakis believes that it is also necessary to regulate the sphere of social expenditures, and by securing correct tax collection to manage the foreign debt of the country.
The World Bank is planning to invest $280 million (107 billion 800 million drams) in eight main programs; among them are the reconstruction of the Yerevan-Vanadzor-Bagarashen road, development of rural programs, etc.
Source: ArmRadio – Original Article
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