Friday, July 1 2016 15:08
Karine Melikyan

In Jan-May 2016 state debt of Armenia grew by 4% to $5.3 bln due to 2.3% growth in foreign debt and 10.1% rise in internal debt

ArmInfo. Growth of Armenia's state debt in Jan-May 2016 by 4% to $5.3 bln (2.5 trln AMD) was due to increase of both foreign and internal debts. According to the preliminary data of the Finance Ministry provided to ArmInfo by the National Statistical Service of Armenia, the foreign debt of Armenia increased by 2.3% to $4.4 bln (2.1 trillion AMD) in Jan- May 2016 amid growth of internal debt by 10.1% to $838.5 mln (400.5 bln AMD).  As compared to Jan-May 2015, the foreign debt grew by 12.8% and internal debt by 22.7%, which resulted in 15.2% increase of Armenia's total state debt.

The government share accounts for $3.94bln or 89% of total foreign debt.  The Central Bank of Armenia (CBA) borrowed the remaining $489.1 mln or 11%.  The Government's foreign debt increased in Jan-May by 2.6% (versus 6.1% growth a year ago). An almost similar dynamics was observed at the CBA - 2.7% growth in Jan-May (versus 1.3% decline a year ago). The Government's foreign debt increased 11.4% year-on-year with that of the CBA growing 12.6% y-o-y.

Government bonds accounted for most of the internal debt, growing from 87% to 89.6% in Jan-May 2016 ($751.4 mln or 358.9 bln AMD) with 26% y-o-y increase and 12.2% increase in Jan-May 2016 in absolute terms. Armenian Eurobonds accounted for 10.2% (down from 13%) and totaled $85.1 mln or 40.7 bln AMD of total (1.8% y-o-y growth and 14.1% decline in Jan-May in absolute terms). The remaining part is the guarantees (0.2% or $1.9 mln), the trade loans were zeroed.

As of Jan 1 2016, the state debt of Armenia totaled 2.5 trillion drams or $5.1 billion (versus 2.1 trillion in 2014 and 1.9 trillion in 2013). The foreign debt accounted for 2.1 trillion drams or $4.3 billion in total state debt (versus 1.8 trillion in 2014 and 1.6 trillion in 2013). The internal debt accounted for 368.4bln drams or $761.5 bln. Gold and currency reserves in 2015 totaled $1.8bln.  Growing foreign debt of Armenia and high migration are worsening the debt burden per capita, which increased since 2015 to $1.7 thousand by April 1 2016.  This indicator for the foreign debt alone increased to $1.5 thousand (versus $550 in 2009). If the real scale of migration were considered, the foreign debt burden per capita would be much higher. The coverage of foreign debt by gold and foreign exchange reserves made up 41.1% by 2016, exceeding the indicator of 2014 by 39.3% and yielding to the level of 2013 by 57.7%. The result of this, according to ArmInfo's analysts, is that in 2013 amid growth of gold and foreign exchange reserves by 27.8% (to $2.3 bln) rates of foreign debt growth were not tangible (5% to $3.9 bln), after which in 2014 amid decline of gold and foreign exchange reserves by 34.8% (to $1.5 bln) foreign debt increased by 13.7% (to $3.8 bln) and in 2015 both reserves and foreign debt demonstrated upward trend. Thus, in 2015 gold and foreign exchange reserves increased by 20% and 19% respectively. The experts forecast that in 2017 Armenia's foreign debt will increase, after which it will start to decline.

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