$73.6 MILLION
f
05:11 pm | March 30, 2010
Economy
IMF Completes Third Review Under Stand-By Arrangement for Armenia
and Approves $73.6 Million Disbursement
The Executive Board of the International Monetary Fund (IMF) today
completed the third review of Armenia’s economic performance under
a program supported by a Stand-ByArrangement (SBA). The decision
enables the immediate release of an amount equivalent toSDR 48.485
million (about US$73.6 million), bringing total disbursements so far
an amountequivalent to SDR 350.425 million (about US$532.2 million).
The Executive Board also approved a request for a waiver of
nonobservance of the end-December 2009 quantitative performance
criterion on the net domestic assets of the CentralBank of Armenia
(CBA).
The 28-month SBA was approved for an amount equivalent to a total
of SDR 368.0 million (about US$558.9 million) on March 6, 2009 (see
Press Release No.
09/68), with a total amount of access augmented to an amount equivalent
to SDR 533.6 million (about US$810.4 million) on June 22, 2009 (see
Press Release No. 09/228).
Following the Executive Board’s discussion on Armenia, Mr. Murilo
Portugal, Deputy Managing Director and Acting Chair, stated:
"Armenia’s performance under its Stand-By Arrangement with the Fund has
been strong, andthe economic recession appears to have bottomed out,
aided by supportive monetary and fiscal policies. The challenge remains
to support the fragile recovery, address externalvulnerabilities,
and advance a credible fiscal consolidation plan over the medium term.
"Fiscal policy aims to continue to support the recovery, while
gradually starting fiscal consolidation in 2010. Social spending will
be protected. The authorities are committed to make good progress on
the reforms in tax policy and administration, as well as on public
expenditure and debt management.
"Monetary policy aims to move from an accommodative to a more neutral
stance, in order to head off potential inflation pressures. The
authorities are committed to a flexible exchange rate regime, and
aim to strengthen the monetary transmission mechanism to enhance the
International Monetary Fund Washington, D.C. 20431 USA
effectiveness of monetary instruments, as well as improve the central
bank’s communication strategy.
"The financial sector remains sound and well capitalized, and
the authorities have strengthened their crisis preparedness and
contingency planning frameworks. Further reformswill be important to
ensure continued resilience to risks.
"The authorities are committed to pursue broad-based structural
reforms to enhance productive capacity and promote long-term growth
through an open trade regime, an improved business environment,
better governance, and increased market competition in keysectors of
the economy," Mr. Portugal said.