Yerevan /Mediamax/. Moody’s Agency published the annual report, which reads that Armenia's Ba2 ratings with stable outlook balance its low economic resiliency and high government financial strength.

Mediamax reports that according to Moody’s, dependence on remittances, which fuelled an ultimately unsustainable construction boom, is one of the main reasons Armenia’s economic resiliency is judged low.

"Armenia faced significant challenges in 2009. Although it was not directly affected by the global financial crisis as its banking sector is relatively small, it was exposed to the subsequent global downturn, principally a collapse in remittances that led to a near 15% decline in GDP," says Anthony Thomas, Vice President -- Senior Analyst in Moody's Sovereign Risk Group.

The report reads that the authorities of Armenia responded with a comprehensive and ambitious package of counter-cyclical measures including an easing in fiscal and monetary policies. Moody's analysts state that although these measures succeeded in limiting the downside in GDP, the result was a severe deterioration in the government's debt metrics.

At the same time, Moody’s notes that Armenia introduced its policies within an IMF framework which, if followed, should allow the government to reverse the deterioration in its debt metrics.

"But if Armenia fails to implement the IMF agreement in full, the country's rating could come under pressure," noted Anthony Thomas.