Tuesday, October 9 2018 17:55

ArmInfo.The budget for the 2019th year is a document of the transition period and, accordingly, one should not pin great hopes on the document. This opinion was  expressed by the economist, head of the statistics department of the  Armenian State Economic University, an expert of the NGO "National  Center for Public Policy Studies" Armen Ktoyan at the October 9 press  conference.

According to the economist, although the document is a ghost of the  budget of the previous government, it is more sincere. The draft  budget-2019, as he noted, is a fairly pragmatic document, without  revolutionary euphoria, and the sincerity of the financial  authorities's approaches is manifested, including the fact that the  Cabinet of Ministers could record higher figures for the expected  economic growth, but did not all possible internal and external  risks.

By the end of 2018, according to the economist, the government will  not only "master" budgeted GDP growth of 4.5%, but will also reach  6.5%. Perhaps already by the end of 2019, the financial authorities  of the country will ensure economic growth above the forecast of 4.9%  projected by the draft budget.  The government of Armenia approved  the draft state budget for 2019 at a meeting on September 27. GDP  growth, according to the document, will be 4.9%, instead of 4.5% laid  down in the approved state budget for the 2018th year, the  consolidated budget for the next year in terms of revenues is  estimated at 1,533.7 billion AMD (without revenues from  intergovernmental transfers) instead of 1,343.5 billion drams in  2018, in terms of expenditures - 1,685.3 billion drams (without  revenues from intergovernmental transfers), against 1,500.5 billion  drams this year, the deficit is about 151.6 billion drams or 2.2% of  GDP, against 156.9 billion drams pledged for the 2018th year. The  sources of financing the budget deficit will be 54.2 billion drams -  domestic sources, and 97.5 billion drams - external. Community  budgets for 2019 are estimated at 138.9 billion drams in revenue  (including official grants from the state budget), and in  expenditures - 138.9 billion drams. This year, a figure of 130.1  billion drams was laid. The draft law provides that in 2019, when  making decisions on monetary policy, to the extent allowed by the  law, the central bank will be guided by a target of 12-month  inflation at 4% with a tolerable limit of fluctuations of +/- 1.5% .  In 2019, capital spending from the current 2.3% of GDP will rise to  3%. State treasury revenues will amount to 1 trillion 491 billion  drams (1.308.3 billion drams in the current year), of which tax  revenues will amount to 1 trillion 399.2 billion drams (in 2018,  1,248.5 billion drams) expenses - 1 trillion 642.2 billion drams  (against the current 1,465.2 billion drams. Large) Some 44% of the  state budget will be spent on social and cultural programs, 24% of  all state budget funds will be spent on solving problems related to  maintaining public order, security and defense, and 12.3% will be  invested in the real sector of the economy. In view 3.2% of all  expenditures will be allocated to local governments' budgets and 5.8%  - to government departments. In 2019, the government will spend 10%  of total expenditures on servicing the public debt. The ratio of  public debt to GDP will be 50.4%.

It should be noted that recently the Central Bank of Armenia raised  the range of the forecast for GDP growth for 2018 from the previous  4.6-6.5% to the current 5.6-6.9%, more modestly revising the expected  growth threshold for 2019 in the direction of acceleration - 4,  6-6,4% and for 2020 - 4,1-6,2%, against previously predicted  respectively 4,1-6,2% and 3,9-6,1%. The Ministry of Finance of  Armenia revised its forecasts for the current year from 4.5% to 6.5%.  According to the World Bank's forecast for 2018 updated in June 2018,  Armenia's GDP growth will be 4.1%, with a slowdown to 4% in  2019-2020. As the World Economic Outlook's IMF Challenges to Steady  Growth (World Economic Outlook) survey in October, the International  Monetary Fund raised its forecast for economic growth in Armenia for  2018 from 3.4% to 6%. The IMF also raised its forecast for GDP growth  for 2019 from 3.5% (April forecast) to 4.8%. Inflation in 2018 is  projected at 3%, and in 2019 at 4.4%.