WB TO CONTINUE HELP ARMENIA
Arka News Agency, Armenia
March 13 2007
YEREVAN, March 12. /ARKA/. The World Bank (WB) will continue helping
Armenia maintaining the economic growth rates, creating jobs and
reducing poverty, says the WB Country Assistance Strategy Progress
Report (CASPR) endorsed by the WB Board of Executive Directors.
"Armenia has come a long way over the past few years and should
be proud of its accomplishments. The Progress Report provides
a clear framework for measuring these achievements," says Donna
Dowsett-Coirolo, World Bank Country Director for Armenia.
The past few years have been a period of considerable progress
for Armenia, including GDP growth rates in the double digits,
macroeconomic stability, important policy reforms and significant
progress in combating poverty.
To date, the financial sector is growing strongly, with the
loans-to-GDP ratio rising from 5.9 per cent in 2003 to 8.2 percent in
2005. Private sector growth has also been supported by infrastructure
improvements. Transparency and accountability in the provision of
government services has been strengthened. Poverty has declined from
around 50 to 30 percent in the last few years, with extreme poverty
dropping to below 5 percent. Good progress is also being made in
social sector spending and reforms.
In light of Armenia’s growing GDP per capita and improving
creditworthiness, the CASPR confirms Armenia’s eligibility to begin
some limited non-concessional borrowing from the International Bank for
Reconstruction and Development, in addition to its soft loan funding
from the International Development Association. This is a clear sign
that Armenia is entering the ranks of middle income countries. At the
same time, the transition will have to be gradual in order to avoid
a premature buildup of debt.
The CASPR indicates that the Bank has delivered all of the activities
included in the CAS, including both annual policy support and
investment lending. Investment lending during the first half of the
SAC period included the Rural Enterprise and Agricultural Development
Project, Yerevan Water and Wastewater Project, Urban Heating Project,
Renewable Energy Project, Avian Influenza Control Project, and the
third replenishment of the Social Investment Fund. The CASPR also
describes the growing involvement of the International Finance
Corporation, the World Bank’s private sector arm in Armenia.
The current CAS covers the 2005-2008 period and sets out three broad
pillars of engagement: promoting private sector-led economic growth,
making growth more pro-poor and reducing non-income poverty.
The Board of Directors also approved three additional operations
alongside the CAS Progress Report – the third Poverty Reduction
Support Credit, the Health Modernization Project and the Judicial
Reform II Project.
Since 1993, the WB has allocated a total of $1.025bln to Armenia for
the implementation of 47 programs. Armenia plans to receive $38.5mln
credits from the WB before the end of 2007.
13.4% economic growth was recorded in Armenia in 2006 compared to
2005. GDP per capita made AMD 827,394 or $1,989.