The volumes of Armenian product exports continue to decline: the 'LUYS' Fund | Finport.am
In January-July 2026, the growth of economic activity in Armenia remained at a high level, but in recent months there has been a gradual slowdown and deepening imbalance in the growth structure.
This is stated in the analytical material on the socio-economic development of the RA economy for January-July 2026, prepared by the 'LUYS' Fund.
According to the fund's analysts, the cumulative growth for January-July was 7.7%, with the main sources being the service sector, industry, and construction.
At the same time, against the backdrop of high growth rates in the service and construction sectors, industrial growth has slowed, and trade growth has remained almost zero.
The decline in exports, acceleration of imports, reduction of capital expenditures, and inflation levels above the target range also indicate that the current high growth has not yet fully transformed into balanced and sustainable long-term growth.
Therefore, experts from the Fund believe that it is important not only to maintain growth rates but also to improve its structure and quality, especially by increasing the role of productive, investment, and export-oriented sectors.
It is noted that in the country's foreign trade, the dynamics of exports and imports continue to move in opposite directions.
In July, the annual decline in exports somewhat eased to 15.7%, but the cumulative decline for January-July deepened to 7.9%.
At the same time, import growth accelerated in July to 21.5%, and cumulative growth reached 7.7%.
This divergence increases pressure towards worsening the foreign trade balance.
Notably, the recorded decline in the export of plant products by 25.7% may contain the first signs of the impact of restrictions imposed by the Russian Federation since June, although the degree of their separate influence cannot yet be clearly assessed as the available detailed commodity data only covers the initial period of the application of restrictions.
In the fiscal (budgetary-tax) sector, high revenue growth continues, but the structure of expenditures remains a concern.
In January-July 2026, current expenditures increased by 17.2%, while capital expenditures decreased by 26.6%.
The reduction in capital expenditures continues to be due to the issue of their underperformance, which negatively affects the development of economic potential.
Meanwhile, the net inflow of remittances from abroad has become an additional factor supporting domestic demand and the currency market.
In January-June 2026, the net inflow of remittances from individuals through RA banks amounted to about $1.38 billion compared to $587.6 million for the same period last year, increasing by 2.34 times, or by 134.4%.
This significant net inflow coincides with the ongoing strengthening (revaluation) of the Armenian dram against the US dollar. Thus, in the context of increasing cash inflow, the Armenian dram continued to strengthen, which may negatively affect export competitiveness, according to experts from the 'LUYS' Fund.
