ArmInfo.On April 22, at a regular meeting, the Government of Armenia approved the annual report on the implementation of the state budget of the Republic of Armenia for 2021.
As Deputy Minister of Finance of Armenia Armen Hayrapetyan stated, presenting the document, Armenia closed 2021 with a 5.7% GDP growth, despite the level of 3.2% index envisaged by the state budget. State treasury revenues amounted to 1,683,831,463.2 thousand drams, expenses - 2,004,300,990.4 thousand drams, the budget deficit reached - 320,469,527.2 thousand drams. In January-December 2021, inflation increased to 7.7% from 3.7% in the same period of 2020. Meanwhile, according to the state budget for 2021, the revenue part of the state treasury was planned in the amount of 1.569 trillion drams, expenditure - 2.000 trillion drams, and the deficit - 341 billion drams.
In particular, tax revenues (tax revenues and state duty) exceeded the planned level by 147 billion drams, exceeding the figure for 2020 by 14.5%, and by 1% - the revised figure. As a result, the ratio of tax collection to GDP increased by 0.3% and reached an all-time high of 22.7% of GDP.
Thus, as of December 31, state treasury tax collections amounted to 1 trillion 586.9 billion drams. Meanwhile, tax revenues (taxes and state duty) in the law "On the State Budget for 2021" were fixed at the level of 1 trillion 440 billion 136 million 839.5 thousand drams. And then, during the year, they revised up to 1 trillion 581 billion drams.
Despite all the difficulties associated with covid and the consequences of the 44-day war in Artsakh, in 2021 the financial authorities managed to reduce the ratio of government debt to GDP by about 3.2 percentage points to 60.3%. In particular, in 2021, the state debt of Armenia increased by $1.257.2 billion (the estimated exchange rate of the Armenian dram against the US dollar was 495.37 drams) - from $7 billion 968.5 million to $9 billion 225.6 million (4 trillion 429.6 billion drams). Thus, in January-December 2021, the government debt increased from $7 billion 508.5 million (by the end of 2020) to $8 billion 767.9 million (4 trillion 209.8 billion drams or 60.3% of GDP) by about $1 billion 259 .4 million or by 16.8%.
External debt (debt obligations of Armenia to international organizations and foreign states, funds received from the issue of Eurobonds) increased by 10.5% or $585.5 million - up to $6 billion 185 million (2 trillion 969.7 billion drams) from $5 billion 599.5 million. In particular, on January 26, 2021, Armenia placed among international investors the 4th issue of 10-year debt securities in the amount of $750 million. During the reporting period, domestic debt increased by about $673.9 or 35.3% - up to $2 billion 583 million (1 trillion 240.2 billion drams) from $1 billion 909.0 million. The debt of the Central Bank increased by 10.5% or $2.2 million and amounted to $457.7 million or 219.8 billion drams (from $459.9 million by the end of last year). As of December 31 last year, the amount of loans issued under government guarantees decreased to $101.4 million or 48.7 billion drams from $120.7 million. By the end of 2021, the share of domestic debt in government debt increased to 29.5% from 25.4% at the end of 2020, and AMD debt - to 28.28% from 24.2%.
According to the deputy minister, in 2021, the total capital expenditures of the state budget of Armenia amounted to about 217.8 billion drams, and their implementation was the highest in recent years, amounting to 92.3% of the adjusted plan, and 100% of the originally set annual plan in the amount of 216.3 billion drams. "Meanwhile, the capital expenditures of the budget in Armenia are chronically underfulfilled," the deputy minister recalled. The volume of capital expenditures in 2021 exceeded the same indicator of 2018 by about 24.7 billion drams and by about 65.8 billion drams compared to 2019. The feasibility of capital expenditures at 92.3% of the adjusted plan in 2021 was the highest in the last four years. In particular, in 2020 the figure was 84.9%, in 2019 - 73.5%, and in 2018 - 74.0%. At the same time, the government has planned investments in the amount of about 350 billion drams for 2022, which will be about 60% more than last year.
The document notes that in 2021, reforms were implemented to improve and develop infrastructure. In this context, steps have been taken to modernize the regulatory and technical base, design, technical control, security, audit, construction skills and knowledge, and in 2021, reforms were carried out to improve and develop infrastructure. In this context, steps have been taken to modernize the regulatory and technical base, design, technical control, safety, audit, construction skills and knowledge.
Exports of goods and services to GDP amounted to 35%, compared with 29.8% in 2020 and 41.4% in 2019, indicating the beginning of a recovery in exports. At the same time, exports in 20 exceeded the growth of imports, due to which their negative balance to GDP decreased to -8% (-13.4% in 2019 and -10% in 2020). With the exception of the agricultural sector, in other sectors growth was recorded. In January-December 2021, the growth of the manufacturing industry amounted to 3.3%. Thus, the export of goods in 2021 increased by 19.1% compared to 2020, while the export of non-commodity goods increased by 18.45%. Exports of goods exceeded $3 billion for the first time, recording a 14.1% increase in dollar terms compared to the non-crisis 2019. In 2021, agro-food products worth about 462.3 billion drams were exported from Armenia. In 2021, compared to 2020, the volume of exported agri-food products increased by about 82 billion drams, or 21.6%, and compared to the non-crisis year of 2019, it increased by about 78 billion drams, or 20.2%.
In 2021, Moody's assigns Ba3 rating to Export Insurance Agency of Armenia. As of 2021, this company has insured an export transaction worth about 36 billion drams, which is 80% more than in 2020. In January-September 2021, the total net inflow of foreign investment amounted to 162.2 billion drams, and direct investment - 88 billion drams, against 13.8 billion drams 43.2 billion drams in 2020 and 98.4 billion drams and 18.6 billion drams in 2019.
To note, according to the Rules of Procedure of the National Assembly and the RA Law "On the Budgetary System", the government submits to the National Assembly an annual report on the implementation of the state budget by May 1 of the next year.
