The gold bubble and the risk of devaluation of the dram

Public Radio, “Without Footnotes” · 30 minutes

“Our exports in 2021 were $3 billion, we closed the exports of 2024 with $13.1 billion, and at first glance it is a tremendous growth, but we must understand that the main reason for this was not the internal strength of the Republic of Armenia, but external factors. 63% of that $13.1 billion, almost two-thirds, was the re-export of gold and diamonds from Russia to other countries. In other words, in the first three months, compared to the first three months of 2024, our exports have decreased almost three times.”

“The Central Bank can pursue two policies. The first is the devaluation policy of the dram, as a result of which industry and exports develop, and the second policy is the strengthening policy, which first of all develops the banking system. If the dram depreciates, in the long term it will lead to developing production and exports, but in the short term it will lead to inflation, an increase in the price of imports and of state debt. If you decide to go down 10 meters, you can walk down those 10 meters over time, you can fall down those 10 meters at once and die. If we want to do something, it should not be sudden, but planned.”

Topic Analysis: Golden Illusion: The Real Picture of Armenia’s Exports