Next year `super-ambitious` for Armenia - expert

ArmInfo. In a word, the state budget of Armenia for 2025 is <super ambitious>. Moreover, this  applies to both expected revenues and expenses. This is the opinion of the head of the ACSES analytical center Haykaz Fanyan.

<While the ratio of expenditures to GDP in 2024 is expected to be at  30.4%, the government sets the task of increasing the figure to 31.5%  in 2025 - spending about 406 billion drams more than in 2024.

Similarly, even in the conditions of economic growth of 5.6% and a  deflator of 3.5%, to generate tax revenues of 304 billion drams, all  other things being equal, we will have to tighten <tax belts>, that  is, by tightening tax administration and policy, collect 75.8 billion  drams, which is also difficult to consider realistic. Now you ask,  what should we do? - it is not feasible. This allows us to maintain  the fiscal balance, which is, of course, good, but at the same time a  bad tradition is being formed, because the budget is also a <promise>  - a promise from the government to residents, foreign private  investors and international financial institutions, and if this  promise is not fulfilled constantly, uncertainty increases,"  the  economist wrote on the social network.

According to the message to the draft budget for 2025, under  conditions of ensuring GDP growth of 5.6%, 3.5% GDP deflator and  average inflation of 3.6%, the state budget revenues of Armenia in  2025 will increase by 279.5 billion drams - to 2 trillion 873.1  billion drams (about $ 7.4 billion), which is 11% higher than the  expected figure for the previous year, and 22% - the actual figure  for 2023. State treasury expenditures are planned at 3 trillion 482.4  billion ($ 7.8 billion) or 31.5% of GDP. 

The figure is 13% higher than expectations for 2024 (30.4%), and 37%  higher than actual expenditures for 2023 (27.5%). Of the planned  expenditures for next year, 2 trillion 749.2 billion drams will be  current expenditures (24.9% of GDP). 733.2 billion drams ($1.88  billion) or 6.6% of GDP will be spent on non- financial operations  (capital investments), which is higher than the planned figure for  2024 of 695 billion drams ($1.79 billion), and the expected 639.3  billion ($1.65 billion) - 6.3% of GDP. According to the results of  last year, capital expenditures amounted to 472.6 billion drams or 5%  of GDP. The deficit in 2025 will amount to 609.4 billion drams or  5.5% of GDP, against 482.9 billion drams or 4.6% of GDP in the budget  approved for the current year and 4.8% - according to this document.