RA GOVERNMENT ISN’T GOING TO PLACE BONDS IN INTERNATIONAL MARKETS NEXT FEW YEARS

AZG Armenian Daily #140, 27/07/2006

Economy

In the next few years the Armenian Government is not going to issue
bonds for placement in the international market, Armenian Finance and
Economy Minister Vardan Khachatrian said during a press-conference
today.He said that presently the country has enough resources,
including credits, and is not going to take up "additional burden."

Khachatrian said that Moody’s rating of Armenia is 1 point higher than
that of Fitch Ratings. Fitch Ratings was more rigid in assessing
the financial risks of the possible resumption of the Karabakh
conflict. One of the negative factors in Armenia is high dollarization.

Moody’s experts say that this makes the Armenian economy
vulnerable. They say that in the mid-term future Armenia has good
chances for ensuring GDP growth and reducing high poverty and
unemployment.

With its not very big currency debt and favorable repayment terms
Armenia can well justify its rating.

In late 2005 the share of the national debt in GDP was 23% which is
not bad for countries like Armenia.

Moody’s experts do not believe that Armenia may resume its war with
Azerbaijan in the mid-term future, but for as long as the conflict is
unresolved, the region will stay in uncertainty. In early June Fitch
gave Armenia BB- issuer default ratings. At the same time, Fitch gave
the country a short-term sovereign rating in foreign exchange B and
country ceiling rating BB.

By Ara Martirosian