Accessibility links

Breaking News

Armenian Prime Minister Downplays Steep Inflation Rise

Armenian Prime Minister Tigran Sarkisian (file photo)
Armenian Prime Minister Tigran Sarkisian (file photo)
YEREVAN -- Armenian Prime Minister Tigran Sarkisian has called higher-than-expected inflation for the first quarter of the year an indication of the country's accelerating economic recovery, RFE/RL's Armenian Service reports.

Official government statistics released on April 1 showed the consumer price index for January-March this year was up 8.4 percent from the same period in 2009, and is nearly double the full-year maximum inflation target set by the authorities.

The inflation rate was pushed up mainly by double-digit increases in the price of various services, fuel, and other consumer goods.

The steadily rising inflation forced Armenia's central bank to tighten its monetary policy and raise its refinancing rate.

Sarkisian said at a weekly cabinet meeting on April 1 that "we have entered a period of high inflation...[but] by the end of the year we will manage to slightly restrain inflationary pressures and these indicators will decrease."

Andranik Tevanian, head of the private think tank Politekonomia, told RFE/RL that the government and central bank have done little to stimulate economic activity during the recession.

He said the authorities have toughened tax administration, further cutting the already shrinking revenues of companies and, especially, small businesses.

Government data show the economy expanding by 3.1 percent in January-February 2010 after a steep fall registered last year.

Finance Minister Tigran Davtian told RFE/RL on March 31 that growth may well continue in the coming months.

Previously, Davtian had said he expects a full economic recovery for Armenia to be "a matter of about one or 1 1/2 years."