World Bank2013-10-022013-10-022013-04https://hdl.handle.net/10986/16032By 2013, the Armenian economy has left behind most of the hangover from the global financial crisis and a look at medium-to long-term growth drivers is therefore in order. Real Gross Domestic Product (GDP) growth reached 7.2 percent in 2012, and the current account deficit narrowed, although it remained high. Macroeconomic buffers have been rebuilt to some extent, although the public debt-to-GDP ratio, at 44 percent, remains too high to relax fiscal restraints. The central tenet of this report is that the government's job creation agenda requires a different growth model than the one followed before the global crisis. Reaching the goals of the government's strategy will require a combination of four factors: 1) higher investment and better financial intermediation between savers and investors; 2) better utilization of the labor force, including the largely untapped resource of Armenians abroad; 3) stronger competitive pressures in the markets for goods and services, which will improve incentives for companies to innovate, adopt new technologies, and become more efficient; and 4) enhanced connections of the landlocked Armenian economy with world markets, including through land, air, and through internet and communication technologies. This report's theoretical framework emphasizes structural reforms to drive growth. Economic growth theory distinguishes between accumulation of the factors of production and enhancing the productivity with which these factors are employed.en-USCC BY 3.0 IGOACCESS TO INFORMATIONAGGREGATE DEMANDAGRICULTURAL OUTPUTAGRICULTURAL PRODUCTIONBARRIERS TO COMPETITIONBARRIERS TO ENTRYBARRIERS TO GROWTHBEHAVIOR OF PRICESBOND MARKETBONDSBUSINESS ENVIRONMENTCAPITAL ACCUMULATIONCAPITAL FLOWCAPITAL FLOWSCAPITAL FORMATIONCAPITAL INFLOWSCAPITAL MARKETCAPITAL MARKETSCARTELSCENTRAL BANKCENTRAL DEPOSITORYCOALCOLLATERALCOLLATERAL BACKINGCOMMERCIAL BANKSCOMMODITYCOMMODITY PRICESCOMMUNICATION TECHNOLOGIESCOMMUNICATION TECHNOLOGYCOMMUNICATIONS TECHNOLOGYCOMPETITION FRAMEWORKCOMPETITION POLICYCOMPETITIVE MARKETSCOMPETITIVENESSCONCEPTUAL FRAMEWORKCONFIDENTIALITYCONNECTIVITYCONSUMER PRICE INDEXCORPORATE CLIENTSCOUNTRY DEVELOPMENTCPICREDIT FACILITYCREDIT INSTITUTIONSCREDIT PRODUCTSCRITICAL MASSCURRENCYCURRENT ACCOUNT BALANCECUSTOMER SERVICEDEBTDECISION MAKINGDEPOSITDEPOSIT RATEDEPOSITSDOMESTIC COMPETITIONDOMESTIC ECONOMYDOMESTIC INVESTORSDOMESTIC MARKETECONOMIC CRISISECONOMIC DEVELOPMENTECONOMIC DEVELOPMENTSECONOMIC DYNAMISMECONOMIC GROWTHECONOMIC INTEGRATIONELECTRICITY GENERATIONEMERGING ECONOMIESENTRY POINTEXCHANGE RATEEXPENDITURESEXTERNAL TRADEEXTERNALITIESFACTORS OF PRODUCTIONFEDERAL RESERVEFINANCIAL CRISISFINANCIAL INFRASTRUCTUREFINANCIAL MARKETFINANCIAL MARKET DEVELOPMENTFINANCIAL PRODUCTSFINANCIAL SECTORFINANCIAL SECTOR DEVELOPMENTFINANCIAL SERVICESFINANCIAL SYSTEMFISCAL DEFICITFIXED COSTSFIXED INCOMEFOOD PRICESFOREIGN CAPITALFOREIGN DIRECT INVESTMENTFOREIGN DIRECT INVESTMENTSFOREIGN EXCHANGEFOREIGN INVESTMENTSFOREIGN INVESTORSFORESTRYFUND INFORMATIONGDPGLOBAL MARKETGLOBAL MARKETSGOVERNMENT BONDGOVERNMENT DEBTGOVERNMENT INTERVENTIONSGOVERNMENT SECURITIESGROSS DOMESTIC PRODUCTGROWTH RATEGROWTH RATESHIGH UNEMPLOYMENTHOME COUNTRYHUMAN CAPITALINCOMESINFLATION DYNAMICSINFLATION TARGETINGINFORMATION TECHNOLOGYINFRASTRUCTURE INVESTMENTSINFRASTRUCTURE PROJECTSINNOVATIVE TECHNOLOGYINSURANCEINTANGIBLEINTELLECTUAL PROPERTYINTERNATIONAL MARKETSINTERNATIONAL RESERVESINTERNATIONAL TRADEINVESTMENT CLIMATEINVESTOR CONFIDENCEIRRATIONAL EXUBERANCEJOB CREATIONLABOR COSTSLABOR FORCELABOR MARKETLABOR PRODUCTIVITYLAW ENFORCEMENTLEGAL FRAMEWORKLIBERALIZATIONLIVING CONDITIONSMACROECONOMIC MANAGEMENTMACROECONOMIC STABILITYMARGINAL COSTSMARKET ACCESSMARKET BEHAVIORMARKET COMPETITIONMARKET CONDITIONSMARKET DISTORTIONSMARKET DOMINANCEMARKET PARTICIPANTSMARKET POWERMARKET REGULATIONMARKET REGULATIONSMARKET SECURITIESMARKET STRUCTUREMARKET STRUCTURESMARKET TRENDSMETALSMICROFINANCEMONOPOLYMORTGAGEMORTGAGE COMPANYMULTINATIONAL CORPORATIONNATIONAL INCOMENATURAL MONOPOLIESNEW MARKETNEW PRODUCTSOILOVERHEAD COSTSPENSIONPOLICY MAKERSPORTFOLIOPRICE DIFFERENCESPRICE FIXINGPRIMARY MARKETPRIVATE EQUITYPRIVATE SAVINGPRIVATIZATIONPRODUCTION TECHNOLOGYPRODUCTIVITY GROWTHPUBLIC DEBTPUBLIC SAVINGRAPID DEVELOPMENTREAL ESTATEREAL GROWTH RATERECYCLINGREGULATORREGULATORSREGULATORY AUTHORITYREGULATORY FRAMEWORKREGULATORY RESTRICTIONSRESOURCE ALLOCATIONRETAINED EARNINGSSAFETY NETSAVINGSSECURITIESSECURITIES MARKETSSECURITIES REGULATIONSECURITY INTERESTSHAREHOLDERSKILL SHORTAGESSKILLED WORKERSSMALL COUNTRYSOLAR GENERATIONSTOCK MARKETSTOCK MARKET CAPITALIZATIONSUSTAINABILITY ANALYSISTAXTAX REVENUETAX TREATMENTTECHNICAL ASSISTANCETRANSPARENCYTURNOVERUNEMPLOYMENTURBAN DEVELOPMENTVALUE ADDEDVERTICAL INTEGRATIONVOLATILITYWELFARE GAINSWORKING CAPITALWORLD DEVELOPMENT INDICATORSWORLD MARKETSWORLD TRADEWORLD TRADE ORGANIZATIONWTOWorld Bank10.1596/16032