Armenia and Georgia's Currencies Become Global Growth Leaders Due to Influx of Russians, Bloomberg

Due to the escalation of conflict in Ukraine, the mass relocation of Russian citizens to Armenia and Georgia has led to these countries' national currencies recording the largest growth among all global monetary units. Since the beginning of the year, the Armenian dram has increased by more than 22%, while the Georgian lari has risen by 16%. The Tajik somoni is also among the leaders in strengthening against the US dollar, reports Bloomberg, citing its own calculations.

“Since the beginning of the year, the Armenian dram has increased by more than 22% against the dollar, showing the largest increase among world currencies. The Georgian lari and Tajik somoni have appreciated by more than 16% and 10%, respectively, surpassing the Russian ruble, which is no longer a freely traded currency due to extraordinary capital controls that have led to its collapse,” stated the report.

One of the main reasons for the strengthening of former Soviet republics' currencies against the US dollar has been the arrival of tens of thousands of Russians in Georgia and Armenia. Since the end of February, they have transferred “savings equivalent to billions of dollars” to these countries.

“It is precisely the Russians, having relocated to these countries for a long time due to geopolitical issues, who are keeping their money in such currencies and driving up the exchange rate,” noted the leading analyst at Freedom Holding Corp.

On November 19, Forbes reported, referencing a study from Renaissance Capital investment firm, that Armenia's economic growth could reach up to 14% this year, despite initial forecasts of a 5% increase. Due to the mass influx of Russians resulting from the escalation of conflict in Ukraine, the country has become the main beneficiary among CIS countries in terms of GDP growth.