Tuesday, January 31 2017 20:40
Karine Melikyan

Debt burden per capita increased to $2thsd because of Armenian state debt increase by 17% to $5.9bln in 2016

Debt burden per capita increased to $2thsd because of Armenian state debt increase by 17% to $5.9bln in 2016

ArmInfo. The state debt of Armenia increased by 17% in 2016 to $5.9bln (2.9 trillion drams), as both foreign and internal debt grew. By preliminary data of the Finance Ministry of Armenia provided to ArmInfo by the National Statistics Service, the foreign debt grew 11% in 2016 to $4.8bln (2.3 trillion drams) amid 49% growth in the internal debt to $1.14bln (550bln drams). To note for comparison, that in 2015 the foreign debt grew 14% and the internal one 18%.  As a result, the total state debt of Armenia rose 16%. 

The Government accounts for $4.3 bln or 89.5% of total foreign debt.  The Central Bank of Armenia (CBA) borrowed the remaining $504.7mln or 10.5%. Government's foreign debt was increasing monthly except in May, Oct and Nov when a meager decrease was registered, and as a result grew by 11.8% in Jan-Dec 2016, at the background of this CBA foreign debt grew by 5.9% versus higher growth rates in 2015-14.6% and 8.3% respectively.

Government bonds accounted for 91% of the total internal state debt for 2016 (versus the previous 87%), ($1.03bln or 500.3bln drams), with the absolute value growing 56.3% year-over-year. Armenian Eurobonds ranked next - $95.6mln or 46.3bln drams, accounting for 8.4% (versus the previous 13%) of the total internal state debt with y-o-y decline in absolute terms by 2.4%. The guarantees account for the rest part-0.6% ($7 mln) with absolute indicator growing 3.5- fold y-o-y. Commercial loans were zeroed since Nov 2015.

The debt burden per capita in Armenia amounted to $2thsd by Jan 1 2017, with foreign debt accounting for $1.6thsd ($550 in 2009) of total, as the state debt kept growing amid high rates of migration.  In fact, taking into account the real scales of migration, the foreign debt burden per capita would be much higher (by statistics, the population of Armenia totaled 2.987mln versus 2.999mln a year before and 3.274mln five years before). In 2016 the coverage of foreign debt by gold and foreign exchange reserves grew from 41.1% to 45.9%, amid 11.6% growth of the foreign debt and 22.2% rise in reserves. According to the updated WB forecast made in November, the share of the state debt in GDP will grow from 48.8% (2015) to 52.5% in 2016, with further growth to 53.8-53.5% in 2017-2018. Noteworthy, in Dec World Bank has revised its forecast on GDP growth in Armenia to 0%, while in Jan 2017 it upgraded the forecast to 2.4% growth with further acceleration to 2.7% in 2017. According to official statistical data in 2016 economic activity in Armenia slackened growth rates to 0.5% from 3.1% in 2015 and 3.9% in 2014. At this background state debt continued growing by 17% in 2016 in AMD terms, in 2015-by 16%, and in USD terms by 17% in 2016 and 14% in 2015.

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 $4.3bln 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 $761.5mln (versus 311.7bln in 2014 and 277.7 trillion drams in 2013).  Gold and currency reserves in 2015 totaled $1.8bln versus $1.5bln in 2014, $2.3bln in 2013 and $1.8bln in 2012). 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.

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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

 5.8314%

Maximum yield

 5.8314%

Мinimum yield

 5.8314%

Weighted average yield

 5.8314%

Number of participants

2

The maturity date of T-bills

03.02.2020

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USD

Средневзв. Цена

482,00

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  USD

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-

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USD

Цена откр.

482,00

Цена закр.

482,00

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482,00

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482,00

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200 000

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96 400 000