TIGRAN DAVTIAN: LOW DEFICIT WILL PROVIDE SERIOUS OPPORTUNITY TO HAVE ENOUGH RESERVES FOR REDUCING IMPACT OF POSSIBLE ECONOMIC CRISIS

Noyan Tapan

Nov 27, 2008

YEREVAN, NOVEMBER 27, NOYAN TAPAN. As a result of discussion of the
2009 draft state budget, the government has received 534 proposals from
the National Assembly deputies, factions and standing committees. 177
or 33.2% of these proposals were accepted fully or partially. As
a result, the government has managed to include the proposals in
the total amount of funds, making internal distributions, accepting
considerably the proposals of deputies, and keeping the overall indices
of the state budget. The expenditures of the 2009 final draft state
budget make 945.4 bln drams, revenues – 905.4 bln drams and the
deficit – 40 bln drams, the RA minister of finance Tigran Davtian
said at the November 27 special session of the National Assembly.

According to him, all the main macroeconomic indices were also
maintained in the final version of the draft. The only change was made
in the settlement index of the exchange rate of the Armenian dram:
the average Armenian dram/US dollar index was fixed at the index of
303.69 as of November 3 instead of the preliminary version of 302.44,
and the Armenian dram/euro index was fixed at 389.83 instead of the
preliminary version of 442.89.

T. Davtian said that the majority of 534 proposals submitted
by deputies were related to envisaging additional sums for
expenditures with various aims as well as to redistribution of
some expenditures. The amount of additional financing by proposals
envisaging an increase was assessed at 27.3 bln drams, including
financing in social-cultural and educational sectors – 16 bln drams,
in economic branches – 5.6 bln drams, and in the sphere of state
assistance to communities – about 1.5 bln drams. Proposals of a total
of 5.8 bln drams were accepted, including proposals of 4.1 bln drams
in social-cultural and scientific sectors, 0.11 mln drams in economic
branches, 770 mln drams for maintenance of the state machinery,
and 760 mln drams for state assistance to communities. The proposals
related to other sectors amounted to 40 mln drams.

On its own initiative the govenment proposes increasing the tax
revenues of the year by 1.5 bln drams and reducing the revenues from
official grants by 1.4 bln drams – due to the decline in the exchange
rate of the euro.

In the words of the finance minister, the low deficit "will provide
quite a serious opportunity to have enough reserves for reducing the
impact of the possible economic crisis". It was announced that some
chnages were also made in the message of the 2009 draft state budget
in connection with the global economic developments.