ARMENIA’S STATE BUDGET REVISED

news.am
Nov 18 2009
Armenia

Additional capital injections into the Armenian state budget —
â~B¬100m – will cause the 2010 draft budget to be revised, RA Prime
Minister Tigran Sargsyan stated in Parliament.

The Government plans to revise the defense budget, the amount to
be provided to the Nagorno-Karabakh Republic (NKR), as well as the
funds intended as compensation for the population’s savings in the
USSR Savings Bank. The Premier said that Armenia’s defense budget
will be brought up to 131bn AMD, as much s this year.

RA Minister of Finance Tigran Davtyan reported that the on-budget
expenditures will exceed 930bn AMD. According to him, Armenia will
receive additional fund, which are not yet included in the draft
budget. Davtyan pointed out that Armenia plans to receive 24bn AMD
under the U.S. Millennium Challenge program, as well as financial
injections from the European Union (EU).

The Minister also reported that Armenia’s national debt will constitute
46% of GDP next year — 30% of it being the Government’s foreign debt,
13% the Central Bank’s foreign debt, as well as the internal debt. The
Minister, however, is not concerned over the figures. Talking to
NEWS.am, Minister Davtyan said it is an acceptable figure, as, under
the Armenian law, the country’s national debt may constitute up to 60%
of GDP. The Minister stressed that Armenia always repays its debts
on schedule, and next year will not be an exception.

Davtyan stressed that the Government has started negotiations over
debt restructuring with a number of donor organizations. "So it is
quite realistic for us to serve our national debt. Moreover, some of
the credits, particularly the Russian loan, have been redistributed
among economic entities," the Minister said. Davtyan added that the
Government has taken many of the proposals made by the parliamentary
factions into account, particularly the ones concerning school
construction.

The revision of the on-budget expenditures caused Parliament members’
discontent. In private talks with journalists they said they had been
befooled – they were shown a draft, and all the key figures were
to be revised later. According to the draft, the defense budget as
112bn AMD – almost 20% less than in 2009. Later, however, RA Deputy
Minister of Finance Pavel Safaryan reported that the budget might be
"revised upward."