Tuesday, December 6 2016 18:24
Emmanuil Mkrtchyan

EFSD council approves disbursement of second tranche of the EFSD financial credit of US$ 100 million to Armenia

ArmInfo. The Council of the  Eurasian Fund for Stabilisation and Development (the EFSD, the Fund)  has approved disbursement of the second tranche of the EFSD financial  credit of US$ 100 million to the Republic of Armenia. The official  website of the Eurasian Development Bank reports that the key areas  of reforms supported under the EFSD programme include strengthening  the financial soundness of the energy sector, raising the efficiency  of the public finance management, and improving the investment  climate. In the framework of the programme, the reforms to promote  de-dollarization of the economy, greater credibility of the banking  sector, and higher exports have also been continued. The assessment  of Armenia's performance prepared by the Manager is generally  positive.

Implementation of the tranche's conditionalities had a positive  effect on strengthening the financial sustainability of the energy  sector. Owing to improved methodologies of tariff margin calculation  and the forecast of electricity generation and distribution aimed at  greater flexibility of the tariff policies and enabling demand and  supply shock smoothing, the Electric Network of Armenia CJSC [closed  joint-stock company] has fully repaid accumulated arrears to the  Armenian NPP, Yerevan CHP, and the High-Voltage Network totalling US$  50 million that is equivalent to 56% of the companies' electricity  supply (turnover) over the period of the arrears repayment (December  2015 - July 2016).

A range of legislative acts have been developed to improve the  efficiency of the public finance management. In early October 2016,  the National Assembly of Armenia adopted the first ever national Tax  Code that streamlines and improves the tax legislation in the  framework of a single document. With the Tax Code coming into effect,  the tax potential of the economy will be significantly  strengthened-the cumulative growth of tax revenues in 2017-2021 is  estimated at 2% of GDP-and the tax policies will become more stable  and predictable. Amendments to the Procurement Law have been  presented for the consideration of the National Assembly of Armenia  to expand the practice of electronic public procurement for the needs  of government bodies, thus facilitating more efficient budget  spending and reducing risks of corruption. The reforms to improve the  investment climate have been continued. 

Simplified and expanded access of potential investors to information  detailing the rules of doing business in construction, as well as  expanded practice of using an electronic system of issuing  construction permits will help reduce transaction costs in the  construction sector and make the sector more attractive for  investors. A register of moveable assets has been created to improve  accessibility of credit for the private sector by introduction a  secured transaction framework and to reduce the cost of loans by  lowering the risk premium. The country's monetary authorities have  adopted a range of regulatory and legal acts aimed at reducing the  level of dollarization of deposits and loans, strengthening the  credibility of the banking system and promoting exports.  These  measures have serves as an additional incentive for exports  development that has been the key driver of Armenia's economic growth  in recent years.

One indicative condition had not been met by the control date for the  second tranche (1 October 2016). It is related to establishing 10 new  centres of integrated social services operating as 'one stop shops'  to supplement the 18 centres created under the first tranche. The  failure to implement this measure is explained by the fact that the  premises transferred to the Ministry of Labour and Social Affairs in  late 2015 - early 2016 to house the centres of integrated social  services did not meet the seismic resistance standards, therefore a  range of additional measures had to be taken resulting in delays in  implementing the steps. The Ministry has drafted a new schedule of  launching 20 centres of integrated social services, under which only  two centres are to become operational by the control date for the  third tranche (1 October 2017), while the remaining centres will  become operational in 2018. The Fund Council has recommended the  Government of the Republic of Armenia to reconsider and agree with  the Manager the parameters of this condition for the third tranche in  accordance with the new schedule of launching the centres of  integrated social services.

The EFSD Council has also recommended to supplement the  conditionality of the third tranche of the financial credit with new  control targets aimed at maintaining the fiscal and debt  sustainability and present the updated reform programme for the  consideration of the EFSD Council in early 2017. These adjustments  will, in particular, facilitate lowering the budget deficit in 2017  to the level of 2.8% of GDP planned by the Government against 5.9% of  GDP forecasted for 2016, and bringing the debt burden down in the  medium-term perspective.  

Eurasian Development Bank (EDB) is an international financial  institution founded by Russia and Kazakhstan in January 2006 with the  mission to facilitate the development of market economies,  sustainable economic growth, and the expansion of mutual trade and  other economic ties in its member states. EDB's charter capital  totals US $7 billion. The member states of the Bank are the Republic  of Armenia, the Republic of Belarus, the Republic of Kazakhstan, the  Kyrgyz Republic, the Russian Federation, and the Republic of  Tajikistan.  

The Eurasian Fund for Stabilisation and Development (EFSD) amounting  to US $8.513 billion was formed on 9 June 2009 by the governments of  the six countries. The objectives of the EFSD are to assist its  member countries in overcoming the consequences of the global  financial crisis, ensure their economic and financial stability, and  foster integration processes in the region. The EFSD member countries  signed the Fund Management Agreement with EDB giving it the role of  the EFSD Resources Manager.


Exchange rates

Government Bonds

Issue volume

10 billion

Volume of T-bills for placement

200 million

Volume of submitted competitive applications

200 million

Volume of satisfied bids

200 million

Yield at cut-off price


Maximum yield


Мinimum yield


Weighted average yield


Number of participants


The maturity date of T-bills




СПРОС (Покупка)


Средневзв. Цена




Средневзв. Цена




Цена откр.


Цена закр.


Мин. Цена


Макс. Цена


Ср/взв. Цена



Кол-во сделок


Объем (инвал.)

200 000

0бъем (драм)

96 400 000