Monday, November 27 2017 13:35

ArmInfo. By the end of 2017  Armenia's aggregate national debt will grow to $ 6.813 billion or  60.3% of GDP from $ 5.942 billion (according to the results of 2016),  instead of the set in the "Budget-2017" indicator of $ 6.512 billion  or 57.3% of GDP. Thus, for a year, having increased the debt burden  by $ 871 million, Armenia accumulated more than planned $ 301  million.  In the meantime, the amount of $ 1.37 bn will be required  to service the state debt formed as of today in 2020. What caused the  exceeding of the planned indicator and for what purposes the loan  funds were directed, ArmInfo was explained in the Department of State  Debt Management of the Ministry of Finance of Armenia.

In particular, in the budget for 2017 in the state debt line, the  authors of the document fixed an indicator of $ 6.512 billion or  57.3% of GDP. However, by the end of 2017, the aggregate state debt  of Armenia, according to the budget message for 2018, will increase  to the forecast $ 6.813 billion and will make 60.3% of GDP.

 Taking into account that the Central Bank's debt in the main  financial document was laid at $ 617 million or 5.4% of GDP, but  according to the adjusted data by the end of the year it will be $  580 million or 5.1% of GDP, and the difference will in fact be  "compensated" by the government, which overcame debts not by $ 301  million but by $ 338 million.

According to Arshaluys Margaryan, Head of the Department of Public  Debt Management of the Ministry of Finance of Armenia, the excess of  the forecast is mainly due to the attraction of funds within the  framework of budgetary assistance above the planned level, as well as  overfulfilment of the work plan for several programs by the Bureau  for Program Implementation (BPU). Within the framework of budgetary  assistance, as the representative of the Ministry of Finance noted,  Armenia will raise funds by $ 90 million more than was laid in the  approved budget for the current year. In particular, the government  recently signed a loan agreement for 80 million euros from KFW, which  is expected to receive two tranches - 40 million euros or $ 47  million in 2017 and another in 2018. By the end of the year, as part  of the budgetary assistance, another $ 40 million is expected from  the Asian Development Bank (ADB).

At the same time, according to the Deputy Head of the State Debt  Department, Head of the Accounting and Servicing Department of the  Ministry of Finance of Armenia Artak Marutyan, under the programs of  the Bureau for Program Implementation, the government increased  funding due to overfulfilment of the planned plans for the current  year. As the expert pointed out, it is also necessary to take into  account the fact that when drafting the budget for the next year, the  authors of the document, according to the letter of the law, recorded  in it the costs of various programs at the current exchange rate and  price realities. In fact, due to fluctuations in the exchange rate  and rising prices for raw materials and other factors, the  implementation of the planned programs will require more costs than  planned. As a result, budget expenditures are growing and the  Government is forced to make adjustments to expenditure items,  thereby redistributing funds, or increasing the deficit.

In addition, according to Marutyan, exceeding the expected state debt  by the end of the year at a rate of about $ 95 million will be formed  due to the difference in the projections of the exchange rate of the  currency. In addition, the program for the construction of the  Vedinskoye reservoir and irrigation systems will require $ 22.2  million more. Excess of expenditures in relation to the initial  budget was also recorded for various road construction programs. For  example, construction work on the M-6 Vanadzor-Alaverdi- Georgia  border highway, as well as the construction of the Argavand-Shirak  road in the framework of the "Sustainable Urban Development  Investment Program", was required for $ 77 million more.  How much  will exceed the level of public debt at the end of 2018, at this  stage, no one can predict, even those responsible for the sphere.  Meanwhile, according to the budget message for the next year, the  national debt will grow by $ 396 million to $ 7.209 billion.

In 2016, $ 546.5 million was spent on servicing the government debt -  interest rate repayments and principal loans, government bonds and  other financial instruments, this year - the government will spend $  586 million (at the estimated exchange rate of $ 1 475.36 dr. ).  According to the State Debt Strategy for 2018-2020, in 2018 it is  planned to allocate $ 666 million for debt service, $ 710.7 million  in 2019, and $ 1.37 billion for 2020. (at an estimated rate of 1 US  dollar / 483.83 others).  ArmInfo analysts believe that the growing  external debt and high migration in Armenia increasingly deepen the  specific debt burden per capita to $ 2.1 thousand by July 1, 2017,  out of which $ 1.7 thousand comes from external debt. According to  various estimates, by the end of 2017 this figure will be $ 2,240 and  this is only taking into account official statistics on the number of  the resident population of the country (2.9 million people).