ACCORDING TO IMF MANAGING DIRECTOR, ARMENIA HAS CLEAR PROGRAMS OF ECONOMIC REFORMS
Noyan Tapan
Jun 20 2006
YEREVAN, JUNE 20, NOYAN TAPAN. Armenia has clear programs of economic
reforms. The IMF Managing Director Rodrigo de Rato stated this at the
June 17 press conference. He was in Yerevan in order to participate in
the IMF/World Bank Dutch Constituency meeting on June 17-18. Rodrigo
de Rato came to this conclusion after meetings with the RA President,
the RA Prime Minister and the governmental economic team.
In his words, the IMF is prepared to cooperate with Armenia in
the future as well by allocating concessional loans to ensure
the continuity of economic reforms initiated by the Armenian
government. The implementation of the 34 mln-dollar second credit
program on poverty rediction and economic growth for 2005-2008 is
currently underway, after the completion of which ways of providing
assistance to Armenia will also be decided based on proposals of the
Armenian government. Since 1994, the IMF has allocated 350 mln USD to
Armenia, with concessional loans making up 80% of these funds. The IMF
managing director expressed confidence that the Armenian government
will continue reforms in the tax sector.
The RA Minister of Finance and Economy Vardan Khachatrian noted during
the June 18 press conference to summarize the results of the IMF/WB
Dutch Constituency meeting in Yerevan that it would be useful to
study Croatia’s experience of economic reforms, as well as Georgia’s
ongoing reforms in tax sector.
According to him, in the last 3-4 years, Georgia has increased the
ratio of tax revenues to GDP to 20%, whereas in Armenia this index
makes 14.5%.
V. Khachatrian said that Armenia gives priority to increasing the
taxation base without raising taxes. He reminded that the country’s
Poverty Reduction Strategy Paper envisages a 0.4-0.5% growth in the
tax revenues/GDP index, which, however, has not been achieved due to
a high growth of GDP – 12% annually.
Besides, in the opinion of the minister, this ratio is small because
the construction and agricultural sectors, which account for a large
share of GDP growth, are exempt from some taxes.