Friday, December 8 2023 15:48

ArmInfo. Armenia's gross international reserves (GIR) since October have fallen from their historical high of $4.2 billion in the previous two months. Thus, the GIR having decreased by 8.5% or $353 million in October 2023 (versus a 3% decline in October 2022), amounted to $3.813 billion. In parallel with this, a y-o-y growth slowed down - from 13.5% to 5% (or by $179.7 million in October 2023 compared to October 2022).

The dynamics of GIR over the 10 months of 2023 also worsened, turning  towards a 7.3% decline from 12.5% growth over the 10 months of 2022,  or in absolute terms, decreasing by $299 million, according to the  data from the Central Bank of the Republic of Armenia.

In particular, in October 2023, the GIR's reduction  was due to a  decline in external assets in hard currency by 9.7% to $3.761  billion, with a 85-fold sharp increase in the share of SDR in the IMF  -up  to $51.2 million, while a year earlier there was a 3% growth of  the first one with a meager 0.9%  growth of the second one. It is  appropriate to note that due to the recession in October, external  assets in hard currency moved down from their historical maximum, and  the share of SDR in the IMF is too far from the August 2021 record  level of $178.2 million.

In January-October 2023, similar to the dynamics of the IMF, the  trend of external assets in hard currency worsened, turning towards  an 8.4% decline from 13% growth over 10 months of 2022, and the share  of SDR in the IMF, on the contrary, increased sharply-8.3-fold,  recovering from last year's 42% decline.

On y-o-y terms (October 2023 to October 2022), the upward dynamics of  external assets in hard currency remained, but the pace slowed down  from 15.2% to 4.1%, in parallel with which there was a by almost 3-  fold increase  the share of SDR in the IMF, recovering from 70%  recession.

During 10 months of 2023, a decline in GIR and external assets in  hard currency was observed in January- February and April, after  which GIR and external assets in hard currency began to grow monthly,  reaching a new record level in August-September, but there was a  downward trend from October. And the share of SDR in the IMF showed  growth in January  (5-fold), July (5-fold), and October (85-fold).

By the end of 2022, Armenia's gross international reserves (GIR)  reached a record level of $4.112 billion, which was then slightly  exceeded in 2023 in July and much more noticeably in August. In 2022,  GIR increased by 27.3% or $881.8 million (versus 23.5% growth in  2021). Within the GIR, external assets in hard currency also reached  a record level of $4.108 billion, accelerating in growth from 22.7%  to 28.5%, which then reached a new historical maximum in August 2023.  At the same time, the share of SDR in the IMF dropped to $6.2  million, with a reversal of the y-o-y dynamics from an 3.7-fold  increase towards a decline of 81.3%, thereby moving further away from  the record level of August 2021 of $178.2 million.  The share of bank  gold in the GIR of Armenia reset back in December 2003.

Let us recall that on December 12, 2022, the IMF Council approved a  three-year Stand-By Arrangement (SBA) agreement for Armenia in the  amount of SDR 128.8 million (about $171.1 million) in order to  maintain macroeconomic stability, hedge against negative risks and  support the structural reform program

On December 12, 2022, the Executive Board of the International  Monetary Fund (IMF) approved SDR 128.8 million (about US$171.1  million) 36-Month Stand-By Arrangement (SBA) for  Armenia to help  maintain macroeconomic stability, provide insurance  against downside  risks, and support structural reform agenda.  Upon the Board's  approval, an amount equivalent to SDR 18.40 million  (about US$24.4  million) becomes immediately available to Armenia, and  the remaining  amount will be made available, subject to six semi-  annual reviews.

On June 12, 2023, the IMF Board completed its review of the first  review under the SBA standby agreement with Armenia, which resulted  in access to SDR 18.4 million (about $24.5 million), bringing the  total access amount to SDR 36.8 million (about $49 million). ).  Later, on November 7, 2023, the IMF Board completed its review of the  second review under the SBA standby agreement with Armenia. Based on  the results of this review, a meeting planned in mid-December 2023  will consider granting Armenia access to 18.4 million SDR (about  $24.3 million), resulting in a total access amount of 55.2 million  SDR (about $72.9 million).