BUSINESS ENVIRONMENT INDEX MAKES 86.7% IN ARMENIA IN SECOND
QUARTER OF 2008 AS COMPARED WITH SAME QUARTER OF 2007
23-06-2008 17:00:00 | Armenia | Economy
YEREVAN, JUNE 23, NOYAN TAPAN. In the second quarter of
2008, Armenia's economic indices made: the business environment
index - 49.1 against 50.5 in the first quarter, the economic
activity index - 79.3 against 65.6 in the first quarter, and the
consumer confidence index - 49.5 against 53.5 in the first
quarter.
NT was informed by the PR service of the Central Bank of
Armenia (CBA) that although in the second quarter of 2008, two
of the indcated indices had a tendency to decline, they were at
a stable level: over 45. The business environment index made
97.1%, as compared with the same quarter of 2007 - 86.7%, the
economic activity index - 120.8% and 114.2% respectively, and
the consumer confidence index - 92.4% and 93.9% respectively.
Since early 2005, the CBA has conducted quarterly surveys
of financial and nofinancial organizations and households for
calculation of the indicated indices. The purpose of surveys to
assess the change in the current economic situation as compared
with the previous period and the economic expectations of
surveyed entities, and to calculate the economic indices based
on the survey results.
494 organizations of industry, construction and service
sectors were studied in the quarter under review. 1,839
households in Yerevan and all Armenian marzes (provinces) were
surveyed by the Internet, phone or letters. The business
environment, economic activity and consumer confidence indices
were calculated based on the survey results. The business
environment index is calculated by averaging the estimates of
the organizations on the risks and changes in the overall
economic situation, the economic activity index - by averaging
the expectations of the organizations on demand and stocks of
production volumes, products and services. The consumer
confidence index is calculated by averaging the index of current
conditions (the average of the estimates on big purchases, the
change in incomes and the current economic condition as compared
with the previous quarter) and the index of future conditions
(the average of the expectations on purchases, a change in
incomes and employment in the coming quarter).
The indices calculated as compared with the same quarter of
the previous year explain most exactly the actual tendencies in
the economy as they rule out the factor of seasonal
fluctuations.
The questions asked for calculation of the indices are of
qualitative character. The answers have the folloing choices:
"growth", "unchanged level", "decline". Based on the answers,
the share of each choice in the total number of answers is
calculated, then the share of the positive answers is added to
half the share of the neutral answers and the balances of the
answers are obtained. The balances range from 0 to 100. The value
0 of the balance shows that all the respondents noted a decline,
the value of 100 shows a growth, while the value of 50 - a
stable state (the number of respondents expecting a growth is
equal to that of repondents expecting a decline). The range of
the balance from 45 to 55 is seen as a stable level. The
relation of the answer balances to the respective indices of the
the base period gives the final indices.