October 4, 2016 - 11:55 AMT
Paradox of Armenian consumer market
Smartphones instead of food and clothes
According to statistical data, despite the decline of Armenian retail business in the first half of 2016, the sales of smartphones, refrigerators, TVs and other equipment has grown.

In January-July 2016, the retail trading totaled AMD 546,011 billion, which is 4,7% less compared to the same period in 2015. However, according to the data provided by the Customs Service of Armenia, 238,600 cell phones to the amount of $32,7 million (with $137 average price of a phone) were imported in the country during the reporting period against 240,000 cell phones imported in 2015 (with $86 average price of a phone). Thus, the customs value of the phones has grown by $51.

The number and average price of computers imported to Armenia has increased as well: 94,800 computers to the amount of $14,8 million were brought into the country in the first half of 2016 against 68,400 computers to the amount of $10,4 million imported during the same period last year. The average price decreased insignificantly: from $157.9 to $156. The number of imported monitors, projectors and TVs has increased drastically: 168,200 items to the amount of $9,5 million were imported to Armenia in January-July 2016 against 32,300 items costing $3,3 million imported during the same period in 2015, the average price falling by $47. The growth is mostly conditioned by the digital switchover expected later this year.

The import of refrigerators and washings machines has grown by 50% and 64% respectively, with the customs value of cell phones, refrigerators and washing machines rising by about $20 million.

The analysis of the data provided by the Central Bank of Armenia shows that the volume of loans offered for the purchase of equipment grew during the reporting period. Thus, the country’s financial institutions extended equipment loans to the amount of AMD 48.5 billion ($101.6 million) in July 2016 against AMD 37,8 billion ($79 million) in July 2015, increasing by $22,4 million.

Actually, the volume of imports and lending has grown amid the general consumer market decline. It means that in contrast to the reduced purchasing power, Armenian citizens boost spending on cell phones and other equipment with the use of consumer loans.