ArmInfo. The World Bank will provide Armenia with a loan of 26.5 million euros to improve the public administration system. On May 13, the Government of Armenia approved the draft law of the Republic of Armenia on the ratification of the loan agreement of the "Fourth Public Sector Modernization Program between the International Bank for Reconstruction and Development (the main lending institution of the WB - ed. note) and the Republic of Armenia".
As stated in the background note to the document, between the International Bank for Reconstruction and Development (IBRD) and the Republic of Armenia on March 15 and March 18, 2022, a corresponding loan agreement was signed in the amount of 26,500,000 euros.
In order to ensure the continuity of the previous three public sector modernization programs implemented with the support of the World Bank, with the introduction of additional ministries, the Government of the Republic of Armenia considered it expedient to develop and implement the 4th Public Sector Modernization Program, with the support of the World Bank. The importance of this program was confirmed in a letter from the Minister of Finance of the Republic of Armenia to the World Bank dated November 1, 2021.
The goal of the 4th Public Sector Modernization Program is to promote the process of modernizing the public administration system through continuous civil service reforms, digitalization of services provided by the state and local governments, and the introduction of selected e-government systems.
" The proposed program is based on the achievements of the previous three programs, implemented with World Bank support to promote GovTech, a nationwide approach to public sector modernization to modernize the functions and services of the public sector in Armenia. As a result of the successful implementation of the program, it is expected to increase the efficiency of selected public services and improve their accessibility for business and citizens.
Thus, as a result of the modernization of a wide range of public services, it is planned to increase the efficiency of public services provided, their accessibility for businesses and citizens, contributing to inclusive economic growth.
The draft loan agreement "The Fourth Public Sector Modernization Program" between the Republic of Armenia and the International Bank for Reconstruction and Development creates additional financial obligations for the state budget of the Republic of Armenia," the document says.
It is noted that paragraph 2.01 of Article 2 of the Agreement provides that the IBRD agrees to provide Armenia with a loan in the amount of 26.5 million euros (the equivalent of 29.9 million dollars). The loan repayment period is 25 years, of which the grace period is 14.5 years, the annual interest rate on the loan is the base rate (EURIBOR) + floating spread. The unpaid loan amount is calculated at the rate of 0.25% per annum 60 days after the signing of the agreement, and shall be paid every six months, simultaneously with the payment of interest. There is a one-time fee of 0.25% of the loan amount, which shall be paid no later than 60 days after the entry into force of the agreement. Government share - 5.3 million euros (equivalent to 6 million dollars).