European Bank for Reconstruction and Development (EBRD) has upgraded Armenia’s economic growth forecast up to 2.3% and 2.% in 2016.

The EBRD’s latest Regional Economic Prospects report reads this.

It should be recalled that as of May 2015, the organization forecasted 1.5% economic decline for Armenia and 1% economic growth for 2016.

The EBRD noted that as of the first half-year of 2015, Armenia has registered more considerable growth than expected.

“Following a significant depreciation pressure at the end of 2014, the exchange rate stabilised in 2015 amid tight monetary conditions, central bank’s interventions in the beginning of the year and adjustment of the current account. Gross international reserves were on a downward path for most of 2014 and in January-February 2015 before increasing to close to four months of imports by September 2015. Public finances remained generally sound amid limited fiscal space. Regional economic slowdown resulted in lower remittances, lower imports and negative credit growth in the first eight months of 2015”, the EBRD experts noted.

The Bank forecasts that Caucasus countries (Armenia, Azerbaijan and Georgia) will overall be able to maintain the economic growth in 2015-2016 though they are still affected by regional economic and security issues.

The EBRD expects that growth in Georgia will moderate to +2.5 per cent in 2015 and keeps its modest growth forecast of +2.6 per cent for 2016. In Azerbaijan, 3% growth is expected in 2015 and 2.5% in 2016. The same indicators in Turkey make 3% and 2.8% respectively.

The international structure expects the overall growth rates in the region to reduce to 0.2% as compared to 1.8% in 2014. Moderate growth is expected in 2016- 1.6%.

The report cites as risks a sharper than expected slowdown in China, a stronger-than-expected increase in US interest rates, political instability and geopolitical tensions and an uneven implementation of the bailout programme in Greece.

The report notes that the refugee crisis that intensified sharply in 2015 is affecting the economies of a number of countries.