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Overview

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ARMENIA

2021

Population, million

3.0

GDP, current US$ billion

13.9

GDP per capita, current US$

4,670.2

Poverty Rate (US$5.5/day 2011 PPP terms) (2019)

44.7

Life Expectancy at birth, years (2018)

75.1

Prudent macroeconomic policies supported by an active inflation targeting regime, an effective fiscal rule, sound financial sector oversight, and continued pro-competition reforms helped Armenia weather the twin crises of 2020 (the COVID-19 pandemic and the military confrontation with neighboring Azerbaijan) with a lower-than-expected increase in poverty rates. 

After a long period of low and stable inflation, price levels started to pick up at end-2020 and accelerated further in 2021, reaching their peak at 9.6 percent in November 2021, mostly driven by 17 percent food inflation.

Direct geopolitical risks and domestic political uncertainty have subsided, as the agreed ceasefire between Armenia and Azerbaijan in November 2020 has held and snap elections in mid-2021 helped stabilize internal political tensions. However, geopolitical challenges continue to weigh on Armenia’s growth prospects, with closed borders and no economic relations with two of its four neighbors and blocked regional communication networks. Moreover, the Armenian economy is expected to be adversely impacted by the war in Ukraine, given its strong trade, remittances, foreign direct investment (FDI), and financial links to Russia, and by higher global food and fuel prices. 

Armenia still faces significant structural challenges, such as the need for further improvement in the business and investment environment, persistent high unemployment, lingering labor skills mismatches, and weak firm competitiveness.

Last Updated: Apr 11, 2022

LENDING

Armenia: Commitments by Fiscal Year (in millions of dollars)*

*Amounts include IBRD and IDA commitments

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Yerevan, Armenia
9 Grigor Lousavorich St., Yerevan 0015, Armenia
+374-10-52-09-92