Developed countries have allocated funds equal to 8-10% of GDP for fight against coronavirus, and Armenia – 2.2% – economist

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YEREVAN, August 19. /ARKA/. Developed countries have allocated funds equal to 8-10% of GDP for the fight against the coronavirus, and Armenia – 2.2%, Hrant Margaryan, an economist and an expert at the Center for Economic Development Initiatives, said Tuesday at a press conference.

He said that the center’s study has targeted about 18 countries, including Great Britain, France, Denmark, Germany, and has singled out common characteristics in the programs of all countries.

“First of all, assistance is provided to the unemployed, secondly to small and medium-sized businesses. The third thing, which we do not have, is the provision of credit holidays to the most affected areas, for example, tourism, the construction sector. This, in my opinion, is the top priority [measure – ed.], which has not been taken. And the last one is rendering assistance to the healthcare sector,” Margaryan said.

The economist said that in a number of countries, expenditures on programs even exceed the mentioned level, for example, Italy allocated 50% of GDP.

“In my opinion, allocation of large amounts is not enough, because, first of all, it is necessary that the expenditures be targeted,” he said.

Answering the clarifying question of Novosti-Armenia agency about whether Armenia has enough resources to counteract the predicted second wave of the coronavirus, Margaryan noted that if we take into account the fact that Armenia has currently spent only about 2% of GDP, it can be assumed that resources are available.

“However, the collision with the second wave complicates the performance of the entire economy. It is possible to confidently declare whether there are enough amounts or not only on the basis of the available indicators, which, in my opinion, allow [allocate additional funds – ed.],” the economist said.

About anti-crisis programs of the government

In total, the Armenian authorities have approved 24 programs to counter the social and economic consequences of the coronavirus. Some of them imply economic support for business (agriculture, tourism, SMEs, microbusiness, IT and other industries), and others are aimed at social support for various groups of the population. Another program is purely ecological (planting coastal forest belts using willow seedlings).

A number of programs have already been completed, some are still in the process, and the government is discussing new opportunities for assistance for the citizens of the republic and is already adopting long-term development programs.

About GDP

In absolute terms, Armenia’s GDP by the end of 2019 will amount to 6 trillion 551 billion drams. It was originally planned that by the end of 2020, GDP will reach 7.1 trillion drams, but later the projected indicator was reduced to 6.5 trillion drams. According to the National Statistical Committee, Armenia’s GDP grew 3.8% in the first quarter of 2020, compared to the same period in 2019, reaching 1.2 trillion drams.

According to the latest forecast by the Central Bank of Armenia, economic growth in 2020 will be minus 4%, against an earlier forecast of 0.7% growth. The central bank previously predicted that economic growth will mainly recover in 2021, amounting to 7.2%.

On April 29, the National Assembly of Armenia approved a revision of budgetary indicators to counter COVID-19. Taking into account the unfavorable impact of the situation with coronavirus, the budget forecast for GDP was lowered to a decline of 2% (previously, the budget had laid down an increase of 4.9% for the current year), and the deficit was increased to 340 billion drams, or 5% of GDP ( previously 2.3%).

About COVID-19

A state of emergency was declared in Armenia on March 16, 2020 in order to suppress the spread of COVID-19, and then it was extended five times. Thus, according to the government’s decision of August 12, the state of emergency is in effect in Armenia until 17:00 on September 11.

At the same time, restrictions on free movement and some types of economic activity introduced from March 24 were lifted on May 4, and, public transport, gyms, kindergartens and catering facilities resumed operating from May 18. From August 12, foreigners’ entry to the country was allowed. Holding meetings and rallies was allowed as well, but with wearing masks and observing social distance.

As of the morning of August 17, 41,701 confirmed COVID-19 infection cases, 824 deaths and 34,655 recovered patients were recorded in Armenia.

According to the latest daily report released Tuesday morning, there are 41,846 confirmed COVID-19 infection cases, 832 deaths and 34,982 recovered patients in Armenia. ($1 – AMD 484.65).

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