World Bank has lowered its forecast for Armenia's economic growth in 2026 from 5.9% to 5.3% due to the conflict in the Middle East
29.07.2026,
12:03
The World Bank forecasts Armenia's economic growth to be 5.3% in 2026 and 5.1% in 2027, said Armine Manukyan, Senior Economist at the World Bank office.
YEREVAN, July 29. /ARKA/. The World Bank forecasts Armenia's economic growth to be 5.3% in 2026 and 5.1% in 2027, said Armine Manukyan, Senior Economist at the World Bank office.
"Before the escalation of the situation in the Middle East, our forecast for Armenia's economic growth in 2026 was 5.9%. However, given the ongoing uncertainty and the possible moderate impact of the conflict, it has been lowered to 5.3%," Manukyan said during the presentation of the World Bank's Armenia Economic Development Report.
According to her, the current forecast was prepared in April. The World Bank plans to re-analyze macroeconomic indicators in September, after which the assessment may be revised based on recent events.
Manukyan noted that after exceptionally high growth rates in previous years, Armenia's economy is gradually returning to a more moderate pace. GDP growth in 2022 was 12.6%, and by the end of 2025, it was 7.1%, exceeding the World Bank's forecast.
"The trend is moving toward normalization. Growth of 7.1% was also quite high, so in the medium term, we expect the economy to gradually approach its potential growth rate," she said.
Main Growth Drivers
Responding to questions from ARKA, Manukyan stated that the services sector will remain the main driver of the Armenian economy in 2026-2027. Financial and insurance services, information technology, and professional activities provide the most significant contributions. Construction, which has demonstrated high activity in recent years, continues to play a significant role. The contribution of industry, particularly mining, also increased in 2026.
"The structure of Armenia's economy is such that consumption traditionally plays a very significant role. At the same time, investment is beginning to increase, which is also becoming an important factor in economic growth," Manukyan said.
She noted that economic activity is largely concentrated in sectors that require qualified specialists. However, the skills shortage remains one of the main problems in Armenia's labor market.
"There are jobs, but many of them require highly qualified professionals. Therefore, it is necessary to strengthen the link between education, professional skills development, and labor market needs," the economist said.
Armenian Economic Figures and Forecasts
The 2026 state budget projects economic growth in Armenia at 5.4%. According to the National Statistical Committee, preliminary data from Armenia's economic activity index (EVI) for January-June 2026 showed an increase of 7.9% compared to the same period in 2025.
According to the Central Bank's monetary policy report for the second quarter of this year, Armenia's GDP growth is expected to be 4.5-4.1% by the end of 2026, 4.7-3.7% in 2027, and 5-6.2% in 2028, depending on scenarios (A-B).
Armenian economic growth forecasts from international financial institutions for 2026: World Bank - 5.3%; IMF - 5.25%; ADB - 5.5%; EBRD - 5.5%; EDB - 6%; S&P Global Ratings - 5.3%; Fitch Ratings - 5.2%.
"Before the escalation of the situation in the Middle East, our forecast for Armenia's economic growth in 2026 was 5.9%. However, given the ongoing uncertainty and the possible moderate impact of the conflict, it has been lowered to 5.3%," Manukyan said during the presentation of the World Bank's Armenia Economic Development Report.
According to her, the current forecast was prepared in April. The World Bank plans to re-analyze macroeconomic indicators in September, after which the assessment may be revised based on recent events.
Manukyan noted that after exceptionally high growth rates in previous years, Armenia's economy is gradually returning to a more moderate pace. GDP growth in 2022 was 12.6%, and by the end of 2025, it was 7.1%, exceeding the World Bank's forecast.
"The trend is moving toward normalization. Growth of 7.1% was also quite high, so in the medium term, we expect the economy to gradually approach its potential growth rate," she said.
Main Growth Drivers
Responding to questions from ARKA, Manukyan stated that the services sector will remain the main driver of the Armenian economy in 2026-2027. Financial and insurance services, information technology, and professional activities provide the most significant contributions. Construction, which has demonstrated high activity in recent years, continues to play a significant role. The contribution of industry, particularly mining, also increased in 2026.
"The structure of Armenia's economy is such that consumption traditionally plays a very significant role. At the same time, investment is beginning to increase, which is also becoming an important factor in economic growth," Manukyan said.
She noted that economic activity is largely concentrated in sectors that require qualified specialists. However, the skills shortage remains one of the main problems in Armenia's labor market.
"There are jobs, but many of them require highly qualified professionals. Therefore, it is necessary to strengthen the link between education, professional skills development, and labor market needs," the economist said.
Armenian Economic Figures and Forecasts
The 2026 state budget projects economic growth in Armenia at 5.4%. According to the National Statistical Committee, preliminary data from Armenia's economic activity index (EVI) for January-June 2026 showed an increase of 7.9% compared to the same period in 2025.
According to the Central Bank's monetary policy report for the second quarter of this year, Armenia's GDP growth is expected to be 4.5-4.1% by the end of 2026, 4.7-3.7% in 2027, and 5-6.2% in 2028, depending on scenarios (A-B).
Armenian economic growth forecasts from international financial institutions for 2026: World Bank - 5.3%; IMF - 5.25%; ADB - 5.5%; EBRD - 5.5%; EDB - 6%; S&P Global Ratings - 5.3%; Fitch Ratings - 5.2%.
