ArmInfo. From 2012 to 2018, the state debt of Armenia increased by 342%. On February 18, Head of the Methodology, Analysis and International Relations Department of the Audit Chamber of the Republic of Armenia Karen Arustamyan announced this to the RA National Assembly Standing Committee on Financial-Credit and Budgetary Affairs.
The speaker noted that the audit was conducted for the first time, and in the first stage, it covered the period from 2017 to 2018. The work was carried out in accordance with the Law on the Audit Chamber, in accordance with international standards ISSAI 100 and ISSAI 300 and the criteria of the World Bank. The purpose of the audit was to assess the degree of effectiveness of public debt management.
Arustamyan reminded that Armenia is no longer listed as a poor country, which implies a refusal to provide loans on favorable terms, which, in turn, carries certain financial risks, especially considering that 80% of the entire portfolio is debt in foreign currency. There was practically no internal audit in the country, which, meanwhile, should become one of the most important areas in ensuring transparency in the management of public debt.
There is still no open publication of the agency agreement between the Central Bank and the Ministry of Finance, although legislation requires its publication. A strategic long-term program for managing public debt is not presented to the Central Bank of the country, which could be an important help in terms of clarifying the position of the Central Bank on this issue. Nor was hedging of risks related to public debt management.
The issue of managing domestic public debt remains a problem, the size of which in the share of the entire public debt for a long period of time remains at the same level of 20%. Purchased by non-residents of government bonds is only 0.6% of the total public debt. The quality of predictability of interest rate payments continues to be low.
The government often assumes obligations to reduce the size of public debt, but in reality it is different. For example, in 2017-2018 the size of domestic public debt increased by 28.5%. The issue of state guarantees remains open, for which companies attracted credit resources. Information on this issue is not available, as are data on sub-loans. Nor is an electronic database of public debt management maintained.
Earlier, ArmInfo reported that by the end of 2020, the state debt of Armenia will amount to 3.688 billion drams ($ 7.725 million) or 51.8% of GDP. At the same time, the index to GDP will decrease by about 2 percentage points. According to the results of 2020, according to the forecasts of the financial authorities of the republic, the state debt of the Republic of Armenia will grow by $ 296 million or by 329 billion drams. At the same time, external government debt will increase by 31 billion drams or by $ 63 million - from 39.3% / GDP to 42% / GDP (against the actual for 2018 2.666 billion drams or $ 6.923 million, 44.6% of GDP), and growth domestic public debt will be 111 billion drams - up to 891 billion drams (from up to $ 1,639 billion to $ 1, 871 billion) or from 11.99 GDP to 12.6% of GDP, against the actual 672 billion drams or $ 1,390mln (11.2% of GDP) according to the results of 2018.