“I have no number to give you, but what I am hearing from different analysts is that the shadow economy in Armenia could be an equivalent of as much as 35 or 40 percent of GDP,” Aristomene Varoudakis, head of World Bank Yerevan Office told a news conference. “And of course, it is a very important challenge to formalize this informal economy so as to increase tax revenues and be able to pay for much needed social services. The shady economy must be brought to legal field,” he said my emphasizing that the shadow is especially large in the mining sector. Speaking at the news conference, Aristomene Varoudakis said based on the dynamic of the economic expansion in the first four months of the year one can say that the growth will be distributed among different sectors equally, except for agriculture. By stating that during the first 4 months of the current year the economic growth was 7.2% Varoudakis mentioned, “It seems that the anti-crisis program of the government gives its results and the growth is equally distributed on all the branches of economy, except for agriculture.” By the way, according to the WB estimation the activation in the construction sector is also stipulated by the funds provided by international donor organizations. The Armenian government has projected a 1.8% economic growth, while the International Monetary Fund has projected a 4% growth and a 6% inflation. According to Mr. Varoudakis, the growth in some sectors, particularly, in construction is the aftereffect of the government’s anti-crisis program. The sector posted an 8.8% growth in the first four months year-on-year. He mentioned that Armenia’s full-year GDP growth may amount this year to 4-5%. He also added, “During the 3.5 years when I was here I witnessed the dual-digit growth and dual-digit slump, when Armenia was called a Caucasian tiger. Armenia needs deep structural reforms.”
