ARMENIAN STATE BUDGET FULFILLED BY 5.3 BILLION DRAM SURPLUS IN
JANUARY-MAY 2007

YEREVAN, JUNE 30, NOYAN TAPAN. In January-May 2007, the crediting from
the RA state budget made 7.88 bln drams (about 22 mln USD), 7.82 bln
drams of which was provided to the NKR, 55.2 mln drams was provided to
repressed citizens on concessional terms for improvement of their
houses.

According to the RA Ministry of Finance and Economy, 178.8 mln drams of
previously provided credits was repaid to the state budget. As a
result, the net crediting made about 7.7 bln drams. The net crediting
increased by 25.2% on the same period of 2006 at the expense of the
interstate credit given to the NKR in 2007.

In the first five months of 2007, the state budget of the RA was
fulfilled with a surplus of 15.3 bln drams (without the inflow of funds
under credit programs from external sources). The budget was negatively
financed by 22.2 bln drams from the domestic sources of financing and
was positively financed by about 7 bln drams from the external sources.

The state budget was negatively financed by 573.4 mln drams at the
expense of treasury bonds (their issue made 15.8 bln drams, redeption –
16.4 bln drams). 472.7 mln drams was allocated from the domestic
sources of deficit financing for payment of promissory notes. Available
budgetary resouces grew by 21.2 bln drams.

In Janaury-May 2007, the World Bank provided a credit of 10.2 bln drams
under the Poverty Reduction Assistance Program. 3.2 bln drams was
allocated for payment of foreign liabilities.

3.2 bln drams was allocated for state debt’s servicing in the indicated
period, which ensured 61% fulfilement of the respective program for the
first half of 2007: particularly, over 2 billion drams was allocated
for servicing the domestic debt and 1.1 bln drams – for servicing the
foreign debt. Expenditures on state debt servicing declined by 7.2% as
compared with January-May 2006, mainly due to a decline in expenditures
on foreign debt servicing.