ECONOMY

Vaagn KHACHATRIAN

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Vaagn Khachatrian, Research associate, Center for Political and Economic Studies (Erevan, Armenia)

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In line with the trends of the past four years, the country’s economy in 2006 continued to grow rapidly: according to the National Statistical Service, at an annual rate of 13.4%. In absolute terms, annual GDP reached 2,665 billion drams (AMD), and the GDP deflator increased by 4.8%. But whereas in 2005 growth was accompanied by deflation (0.2%), in 2006 inflation exceeded the projected 3% and approached 5.5%. The national currency continued to strengthen against the world’s major currencies. As regards the prospects of economic development, let us note that, unfortunately, the past year failed to become a period of qualitative growth: of course, the achievements of the past few years are obvious, but quantitative GDP growth was not accompanied by qualitative growth, because the share of the “new economy” based on innovation and high technology is insignificant.

Real Sector

According to preliminary estimates, the country’s GDP in 2006 was AMD 2,665 billion ($6,406 million). GDP per capita was $2,002.0 (see Table 1) or $5,100 at……….

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