By Hrach Melkumian and Emil Danielyan
The Armenian economy grew by an astonishing 20 percent in the first quarter of the year, helped by an even greater increase in exports, according to President Robert Kocharian.
The official figure announced by Kocharian on Tuesday represent the highest ever rate of GDP growth claimed by the government. Kocharian said it will result in at least 25,000 new jobs in the course of 2002.
The Armenian leader did not present a breakdown of the figure by the sectors of the economy, saying only that first-quarter exports were up 40 percent from the same period last year. He said the growth rate will remain unusually strong for the rest of the year which will see “interesting indicators.”
According to government statistics, the Armenian economy expanded by 9.6 percent in 2001. Kocharian said late last year that the robust growth translated into the creation of 40,000 jobs.
Opposition leaders and some economists dispute the credibility of the figures, arguing that living standards in the country remain low. Government officials admit that only a small percentage of Armenia has enjoyed the benefits of recent years’ growth.
The Economist Intelligence Unit, a London-based think tank, has said in a recent annual report that Armenian growth will slow down to 5 or 5.5 percent in 2002 due to a worldwide decline in the prices of refined diamonds: a key Armenian export. “The main risk to Armenia stems from its dependence on sales of precious stones and metals, since this leaves the economy vulnerable to global price and demand fluctuations,” the report said. “Weaker import demand in Russia in 2002-03 will also constrain export growth.”
However, the Armenian diamond industry, which went through a major downturn for much of last year, appears to have rallied strongly since the beginning of the year. The industry accounts for approximately 35 percent of Armenian exports.
Kocharian on Tuesday repeated his argument that economic betterment requires political stability and calm. “This is a pre-election year, and the number of new jobs will somewhat depend on how aggressive the opposition will be,” he said.
The announcement of the 20 percent growth was made during Kocharian’s visit to a textile factory in Yerevan. Critics say his increasingly frequent visits to successful private enterprises, which are heavily covered by local media, are part of his bid to win another five-year term in presidential elections due in early 2003.