Overseas Cash Transfers to Armenia Drop 6% in 2016; Many Families Feel the Pinch
In 2016, cash equivalent to US$1.533 billion was transferred by individuals abroad to Armenia via banks in Armenia.
This is $99 million (6%) less than was transferred in 2015, according to statistics released by Armenia’s Central Bank.
Individual Cash Transfers to Armenia via Banks in Armenia (US$)
2004 – 760.7 million
2005 – 965.287 million
2006 – 1.238 billion
2007 – 1.742 billion
2008 – 2.271 billion
2009 – 1.576 billion
2010 – 1.627 billion
2011 – 1.960 billion
2012 – 2.234 billion
2013 – 2.302 billion
2014 – 2.124 billion
2015 – 1.632 billion
2016 – 1.533 billion
Transfers started to fall in 2014 due to a faltering economy in Russia, where the bulk of those leaving Armenia for seasonal work go to. A drop in oil prices and sanctions imposed by the West made matters worse.
Russia remains the source for most cash transfers sent back to Armenia - $897 million in 2016 This is a drop of 11% ($112 million) from 2015.
The United States is also a large source of cash transfers - $177 million in 2016.
It’s no secret that many families in Armenia rely on cash transfers from relatives working abroad to make ends meet.
Decreasing cash transfers to Armenia means less disposable income in the pockets of citizens and thus, less consumer demand for a wide-range of items. Naturally, this in turn, negatively affects retail sales numbers. In 2015, retail sales volume decreased by 10.1%; 2.6% in 2016.
Naturally, factors other than decreasing overseas cash transfers have negatively impacted retail sales.
While $1.532 billion flowed to Armenia in 2016, $817 million was sent overseas from Armenia.
Take the case of Russia. While transfers from Russia have decreased, as noted above, transfers to Russia from Armenia have gone up – by $33.5 million in 2015 and $47 million last year.
This might have something to do with the real estate market in Armenia. In a past interview with Hetq, local Yerevan realtor Vladimir Khachatryan said that some Armenians living in Russia have decided to sell their property in Armenia at cut-rate prices and transfer the dollars to Russia to be exchanged for rubles. The ruble has really depreciated, and those trading dollars can really stock up.