Inflation accelerated in January-June, and public debt increased, but according to Finance Minister Vahe Hovhannisyan, all indicators are manageable.
Economic environment and external factors
According to the minister, during the reporting period, the economic growth of Armenia’s partner countries continued to remain in the positive range. In the US and Russia, growth slowed down sharply due to weakening consumer demand, while in China and the eurozone, growth was mainly due to increased consumption and industrial production.
Changes in exports and imports
“Exports in the Republic of Armenia decreased by 52.8 percent, which was mainly contributed to by a sharp decrease in the re-export of gold, silver and platinum, while exports of goods of Armenian origin increased by 10.3 percent,” Hovhannisyan noted.
Imports decreased by 38.6 percent during this period, which is also due to a decrease in re-exports.
Economic activity and sectoral developments
The economic activity index increased by 6.3 percent in the first half of the year, mainly due to the growth of services. Progressive increases were recorded in the agriculture and construction sectors.
The number of officially registered unemployed decreased, and the number of hired workers increased by 5 percent. This increase was mainly recorded in the trade, construction, public administration and defense sectors.
Inflation accelerated in January-June, approaching the Central Bank’s 3 percent target.
Public debt
The annual adjusted revenue indicator amounted to 2 trillion 848 billion drams, and expenditures – 3 trillion 466 billion drams. The deficit amounted to 39.2 billion drams, instead of the planned 325 billion.
In the first half of 2025, public debt increased by 4.5 percent in dram terms, and by 7.9 percent in dollar terms. Government debt increased by 4.8 percent, while Central Bank debt decreased by 2.2 percent. Total public debt amounted to 5 trillion 323 billion drams or 13 billion 852 million dollars.
The risk indicators of the debt portfolio remained within their limits. The weighted average interest rate remained at the level of 7.2 percent. Domestic debt exceeds external debt, amounting to 52 percent. Domestic debt also accounts for 51 percent, compared to 49 percent of foreign currency debt.