World Bank will not provide loans to Armenia for a while developing new strategic plan for cooperation instead

ArmInfo. The World Bank will not lend to Armenia and will develop new strategic plan for cooperation instead, Senior Economist of WB Armenia Office Gohar Gyulumyan told journalists announcing the regular last tranche amounting to $50mln approved by the Board of Directors yesterday within the forth Development Policy Financing.

She noted that the project of the new strategic program for Armenia, which will define reasonability and need of using various credit instruments will be ready in May 2017 at best and hopefully will be approved by the Board of Directors in June. Answering to ArmInfo's correspondent's question Gyulumyan noted that there is no schedule of providing new loans to Armenia and suggested not worrying about that as budgetary loans are being provided to the country not only from the World Bank but also the Eurasian Development Bank, Asian Development Bank and other international donors. "We hope that there will be no force- majeure situation in Armenia and the country will not seriously deviate from macroeconomic scenario and there will be no need for urgent help from the WB", she said.

At the same time the economist considered satisfactory the results of the implementation of loan programs in Armenia: "All the legislative amendments and planned events including the new Tax Code should ensure higher incomes for Armenia", the representative of WB stated. Meanwhile, the new Tax Code has sparked large discussions and discontent by the business community which considered the document as regressive and not assisting the goals of economy development. Armenia had to adopt the Code as a precondition for receiving regular tranche from IMF.

In overall Armenia,which became member of WB in 1992 and member of International Development Association in 1993, has received $2.3 bln. At this background it should be recalled that Armenia's aggregate state debt will reach 54.6% of GDP by the end of the year. Already in 2017, according to the forecasts of Armenia's Finance Ministry the figure will reach 56.1%. In the structure of the government debt the main lenders to Armenia are International Development Association -38.8% of the debt and International Bank for Reconstruction and Development-15.8%, which are parts of the World Bank.

To recall, the World Bank basing on the data for Jan-Oct sharply downgraded GDP forecast for Armenia to zero. Earlier in January the bank forecasted 2.2% GDP growth, 2.5% in March. On June 17 WB Country Manager for Armenia Laura Bailey stated that the bank forecasts 1.9% growth of economy for the country.  In the latest official document of WB the forecast on Armenia's GDP was 3.1%.