Finance Minister Vartan Aramian predicted on Friday that new sanctions imposed by the U.S. Congress on Russia will not have significant spillover effects on Armenia’s economy.
“I don’t think that the new sanctions will cause major shocks in Russia’s economy and then have spillover effects on us,” he said.
“Why? Because Russia’s economy is already accustomed to such sanctions. I don’t think that their deepening will lead to major shocks,” Aramian told reporters.
Russia is Armenia’s number one trading partner and main source of multimillion-dollar remittances from Armenians working abroad. The Armenian economy was hit hard after the Russian ruble began rapidly depreciating in 2014 amid falling oil prices. Around that time the United States and the European Union slapped their first sanctions on Moscow because of its annexation of Crimea.
The fresh sanctions almost unanimously approved by the U.S. Senate on Thursday will affect a range of Russian industries. They could therefore further hurt the Russian economy that contracted in 2016 and 2015. The ruble weakened against the U.S. dollar following the passage of the Senate bill.
Aramian insisted that a renewed sharp depreciation of the Russian currency is extremely unlikely.
The ruble regained some of its lost value against the dollar in the course of last year. This is one of the reasons why Armenian exports to Russia soared by over 51 percent in 2016, according to official Armenian statistics. Armenia’s National Statistical Service recorded a further double-digit rise in those exports in the first half of this year.
The Armenian government expects the domestic economy to grow by at least 3.2 percent in 2017. The International Monetary Fund and the World Bank have forecast slightly lower growth rates.