BUDGET SEQUESTER POSSIBLE IN CASE OF INSUFFICIENT TAX REVENUES IN ARMENIA

ARKA
Apr 6, 2009

YEREVAN, April 6. /ARKA/. Budget sequester is possible in Armenia
in case of insufficient tax revenues, stated RA Deputy Minister of
Finance Pavel Safaryan.

"Any state budget allow for sequester. If we fail to realize the tax
revenue targets this year we do not rule out sequester. The question
is whether there will be sequester or not," Safaryan told reporters.

Armenia’s budgeted revenues are 905bln AMD, expenditures 945bln
AMD and deficit 40bln AMD. This March the RA Government decided to
carry forward 93bln AMD on-budget expenditures to the 4th quarter of
this year,

Safaryan said budget sequester is possible in case of problems
with tax revenues to prevent additional debts. He stressed that the
present carry-forward is not budget sequester, but redistribution of
the budget.

Safaryan also pointed out that the Government is now thinking of
compensating for the arrears of revenues due to other funds, for
example, the Russian credit.

On February 9, 2009, Russia and Armenia signed a preliminary agreement
on the allocation of a $500mln stabilization credit to Armenia. A
final agreement is expected to be signed late this month. Armenia is
to receive the funds late in May early in June.

"Possible state budget sequester is the most radical solution to all
problems, but we have chosen a different way, that is, redi stribution
of budgetary funds," Safaryan said.