World Bank forecasts weak or negative 2015 growth in Armenia

The World Bank forecasts weak or even negative economic growth this year in Armenia, where the economy is battered by a plunge in Russia's rouble and the Ukraine as well as declining exports and remittances. Reuters reports.

"Economic growth in Armenia might be very low, possibly with a positive dynamic of around 0.8 percent," Laura Bailey, the bank's country manager in Armenia, told journalists on Tuesday.

"However, this small positive indicator could shift towards being negative ... if the economy experiences major external shocks," she added. Economic problems among its trading partners, especially Russia, could have such an effect.

The government forecasts 4.1 percent growth this year, up from 3.4 percent in 2014, although the central bank governor has said the forecast might be revised.

Armenia, a former Soviet state of 3.2 million people, is closely tied to Russia through trade and remittances. It also belongs to Russian President Vladimir Putin's Eurasian Union, a bloc he hopes will rival the European Union.

Bailey said the World Bank planned to give Armenia a $52 million credit to modernise its electrical power stations and hoped to have $17 million in co-financing from the government for the 25-year joint project.

Russia controls the only electricity distribution company in Armenia and its large Razdan power station.