ArmInfo. The increase in the public debt is the price that not only Armenia, but the whole world paid, in order to mitigate the negative impact of the crisis in 2020 in some way. This was announced on June 9 by RA acting Minister of Finance Atom Janjughazyan at the sitting of the Standing Committee of the National Assembly of the Republic of Armenia on Budgetary and Financial- Credit Issues.
Thus, the ratio of government debt to GDP by the end of 2019 was 49.9%. By the end of 2020, the level of government debt to GDP reached 63.5%. However, this tendency is inherent not only in Armenia, but also in all countries comparable in terms of economic power, he said.
At the same time, according to the chief financier, the whole question is how solvent the state is, and the economy is liquid for timely servicing the external debt. Acting Minister of Finance reminded that three quarters of the state debt of Armenia is in foreign currency. "Debt obligations in foreign currency increase the volatility of the cost of debt service,> said the acting minister.
To recall, the average y-o-y exchange rate of the US dollar against the Armenian dram in the State Budget of Armenia for 2020 (approved in December 2019) was set at 476.4 drams per US dollar.
At the end of 2020, the state debt amounted to $ 7.968 billion, of which $ 7.509 billion is government debt (external debt - $ 5.593 billion, and domestic debt - $ 1.915 billion). Having started 2021 with a public debt of $ 7.968 billion, by the end of April 2021 the figure reached $ 8.772 billion, thus, in 4 months the debt increased by $ 804 million.
By April 2021, the specific debt burden per capita reached $ 2.9 thousand (against $ 2.5 thousand a year earlier). Moreover, the per capita debt burden from external debt increased from $ 1.9 thousand to $ 2.3 thousand. The degree of coverage of external debt by gold and foreign exchange reserves by April 1, 2021 remained at the level of 45%, against the background of almost the same y-o-y growth of both external debt and reserves - by 17.1% and 16.5% respectively.
To note, according to the March forecast of the World Bank, the national debt of Armenia will grow to 70.8% of GDP in 2021, with a slight decrease in 2022 to 70.6% of GDP. And according to the April forecast of the IMF, the gross debt of the Armenian government will reach 69.9% of GDP in 2021 (from 62.8% of GDP in 2020), and then in 2022 it will modestly decrease to 68.8% of GDP. Moreover, the IMF draws attention to the fact that Armenia's gross external debt, which already in 2020 exceeded GDP to 103.5%, will continue to prevail over GDP even more in 2021 (107%) and in 2021 (105.1%). At the same time, the WB forecasts GDP growth in Armenia in 2021 by 3.4%, with an acceleration in 2022 to 4.3%, and the IMF forecasts a meager 1% growth in Armenia's GDP in 2021, with an acceleration in 2022 to 3.5%.
According to statistics, in 2020, the GDP decline amounted to 7.4% (against 7.6% growth in 2019), the public debt increased to 67.4% of GDP (from 53.7% in 2019), and the external debt - to 51 , 2% of GDP (from 42.4% in 2019).
