Monday, May 20 2019 20:58

ArmInfo. The IMF approved the  provision of Stand-by loans to Armenia in the amount of about $ 248.2  million. The press service of the Central Bank told ArmInfo that the  Armenian authorities stated that these loans would be considered a  preventive measure and would not be used until There will be no  problems with the balance of payments.

In particular, the Executive Council of the International Monetary  Fund approved the provision of 36 million SDR for 36 months to  Armenia (SDR - special drawing rights) - about $ 248.2 million or  about 139.75% of Armenia's quota in the IMF. The Council approved  that 25.714 million SDR (equivalent to almost $ 35.5 million) are  provided to Armenia immediately, and the remaining amount will be  provided on the basis of six semi-annual estimates.

According to the source, the loan funds will be used to strengthen  the economic foundations and policies of Armenia, as well as to carry  out structural reforms, in particular, to improve management  efficiency and improve the business environment.

"The authorities continue to pursue a stable fiscal policy, guided by  fiscal canons, at the same time providing conditions for the  development of infrastructures and stimulating social spending," the  report said.

After discussion in the Executive Council, the Acting IMF President  Mitsuhiro Furusawa stated: "Armenia has made progress in recent years  in macroeconomic and financial stability, as well as in promoting  economic growth through structural reforms. Economic activity has  increased and public debt has decreased. Inflation is controlled, the  financial system remains stable, and international reserves estimated  to be adequate. However, reform must continue to ensure more balanced  and inclusive growth, with a reduction in imbalances, improving the  business environment and governance mechanisms, and efforts must be  made to further reduce poverty and unemployment. "

He added that the loan funds provided by the IMF for 3 years will  support the task of moving to a more dynamic, sustainable and  inclusive economy. "The preventive nature of these credit funds will  help to withstand external shocks. The authorities continue to pursue  fiscal policy, guided by fiscal rules, while creating conditions for  the development of infrastructures and stimulating social spending.  Realization of these goals should be accompanied by improved tax  administration and modernization of property taxation," said M.  Furusawa.

According to him, further strengthening of monetary policy will  contribute to improving its efficiency and return inflation to the  target threshold in the medium term. "Measures will also be taken to  protect the financial system, further develop the capital market and  facilitate access to finance. Resolute implementation of a strict  structural reform package will contribute to sustainable and  innovative growth, which can be achieved through private sector  development, attracting more foreign direct investment, and deepening  the diversification of the economy. Increasing human capital and jobs  will also play a positive role in the country's economic development,  "he concluded.

Notice that according to IMF forecasts, GDP growth in Armenia in 2019  will be 4.6% with a slowdown in 2020 to 4.5%. The average annual  inflation from 2.1% in 2019 will increase to 3% in 2020, and at the  end of the reporting period  - from 2.5% in 2019 to 3.3% in 2020. The  GDP deflator index in 2019 is expected to be at the level of 104.3%,  and in 2020 at the level of 103.8%. The unemployment rate from 17.9%  in 2019 will drop to 17.7% in 2020. The share of investments in  Armenia's GDP is projected in 2019 at the level of 23.6%, and in 2020  - 24.1%.