EBRD has improved its forecast for Armenia's economic growth in 2026, but points to risks
26.02.2026,
15:26
The European Bank for Reconstruction and Development (EBRD) expects Armenia's GDP growth to be stable at 5.5% in 2026 and 2027.
YEREVAN, February 26. /ARKA/. The European Bank for Reconstruction and Development (EBRD) expects Armenia's GDP growth to be stable at 5.5% in 2026 and 2027. This forecast is contained in the EBRD's report "Regional Economic Prospects. February 2026."
In its previous similar forecast, published in May of last year, the forecasts for Armenia's economic growth in 2026 and 2027 were also identical – 4.5%.
"Growth potential is driven by regional trade and transport opportunities, including the opening of the border with Turkey, the Trump Route for International Peace and Prosperity (TRIPP) program, and expanded cooperation with the EU, but delays in implementing the peace agreement could negatively impact the outlook," the report states. It is noted that economic growth slowed in the first nine months of 2025, as temporary growth drivers beyond 2022 weakened.
"After averaging 8.9% in 2022-2023 and 5.9% in 2024, real GDP grew by 6.0% year-on-year in the first nine months of 2025. Economic activity was supported by strong growth in the financial services, construction, and information and communications technology sectors," the study states.
EBRD analysts note that after low levels in 2024, headline inflation approached the Central Bank of Armenia's target range of 3% ±1 percentage point, averaging 3.3% in 2025.
"With inflation within the target range, the Central Bank of Armenia cut the policy rate by a total of 50 basis points in February and December 2025," the report states.
The EBRD forecasts the government budget deficit to widen to around 5.0% of GDP in 2025, but expects it to follow a growth-friendly consolidation trend from 2026 onward.
"Public debt stabilized at around 50% of GDP by September 2025. Exports and imports declined sharply in 2025 as re-export flows declined. Armenia's international reserves increased to $5.1 billion by December 2025, providing more than three months of import cover, partially supported by the issuance of sovereign Eurobonds in March 2025," the report states.
Armenian Economic Figures and Forecasts
According to Armstat, Armenia's economic growth in 2025 was 7.2%, while inflation was 3.3%. The 2026 state budget projects economic growth at 5.4%. According to the Central Bank's monetary policy report for the fourth quarter of last year, Armenia's GDP growth is expected to be 6.3-4.1% by the end of 2026, depending on scenarios (A-B), and 4.9-5.3% in 2027.
International financial institutions' economic growth forecasts for Armenia for 2026: EDB - 5.3%; WB - 4.9%; IMF - 5.5%; EBRD - 5.5%; S&P Global Ratings - 5.3%; Fitch Ratings - above 5% (for 2026-2027).
In its previous similar forecast, published in May of last year, the forecasts for Armenia's economic growth in 2026 and 2027 were also identical – 4.5%.
"Growth potential is driven by regional trade and transport opportunities, including the opening of the border with Turkey, the Trump Route for International Peace and Prosperity (TRIPP) program, and expanded cooperation with the EU, but delays in implementing the peace agreement could negatively impact the outlook," the report states. It is noted that economic growth slowed in the first nine months of 2025, as temporary growth drivers beyond 2022 weakened.
"After averaging 8.9% in 2022-2023 and 5.9% in 2024, real GDP grew by 6.0% year-on-year in the first nine months of 2025. Economic activity was supported by strong growth in the financial services, construction, and information and communications technology sectors," the study states.
EBRD analysts note that after low levels in 2024, headline inflation approached the Central Bank of Armenia's target range of 3% ±1 percentage point, averaging 3.3% in 2025.
"With inflation within the target range, the Central Bank of Armenia cut the policy rate by a total of 50 basis points in February and December 2025," the report states.
The EBRD forecasts the government budget deficit to widen to around 5.0% of GDP in 2025, but expects it to follow a growth-friendly consolidation trend from 2026 onward.
"Public debt stabilized at around 50% of GDP by September 2025. Exports and imports declined sharply in 2025 as re-export flows declined. Armenia's international reserves increased to $5.1 billion by December 2025, providing more than three months of import cover, partially supported by the issuance of sovereign Eurobonds in March 2025," the report states.
Armenian Economic Figures and Forecasts
According to Armstat, Armenia's economic growth in 2025 was 7.2%, while inflation was 3.3%. The 2026 state budget projects economic growth at 5.4%. According to the Central Bank's monetary policy report for the fourth quarter of last year, Armenia's GDP growth is expected to be 6.3-4.1% by the end of 2026, depending on scenarios (A-B), and 4.9-5.3% in 2027.
International financial institutions' economic growth forecasts for Armenia for 2026: EDB - 5.3%; WB - 4.9%; IMF - 5.5%; EBRD - 5.5%; S&P Global Ratings - 5.3%; Fitch Ratings - above 5% (for 2026-2027).
