Forbes Highlights Armenia's GDP Growth Ahead of Other CIS Countries Amid Ukraine Conflict

Due to a mass influx of Russians, the GDP of Georgia and Armenia may grow at double-digit rates this year, while the Georgian lari and the Armenian dram have already strengthened by 20% and 30%, respectively, from the low levels of 2022. The influx of Russian money has also impacted neighboring countries, but to a lesser extent.

Amid the Ukrainian conflict, Armenia has outpaced all other CIS countries in GDP growth thanks to a significant influx of Russian citizens. This year's economic growth in Armenia could reach 14%, despite initial forecasts estimating it at 5%, according to the reputable Forbes magazine, referencing a study by Renaissance Capital investment company.

As noted by Sofia Donets, the chief economist for Russia and the CIS at Renaissance Capital, Armenia has become the main beneficiary of Russian inflow due to the Ukrainian conflict. The analyst suggests that the GDP growth in the country may reach up to 14% this year, contrary to the initial 5% forecast.

The influx of highly qualified Russian specialists in the IT sector into Armenia will also impact the improvement of GDP growth forecasts. However, other sectors of the economy may benefit as well, claims Sofia Donets. “We see that the IT sector is not yet large in terms of GDP, but the state is promoting the relocation of IT specialists and the localization of businesses in Armenia, which is advantageous for the country's economy. In this sector, we will observe double-digit growth. Currently, the hotel, restaurant, service, and retail sectors have recorded growth of up to 30%,” she concluded.