ARMENIAN GOVERNMENT GIVEN FOREIGN AND HOME CURRENCY Ba2 RATINGS
YEREVAN, JULY 26, NOYAN TAPAN. The Moody’s Investor Service
international rating organization gave the Armenian government foreign
and home currency Ba2 ratings. This was said at the July 25 joint press
conference of RA Minister of Finance and Economy Vardan Khachatrian
and CBA Chairman Tigran Sargsian. The Moody’s Investor Service for
the first time estimates the reliability of the Armenian government
as a debtor.
According to T.Sargsian, the above mentioned rating is higher than the
same rating given to many CIS countries. When calculating the Armenian
rating they took into account the country’s progress since 1995 when
the 7-year period of economic recession caused by the collapse of the
Soviet Union came to the end. It was also taken into consideration
that starting 2001, 10% and more growth of GDP was registered in the
country. At the same time, the inflation was low, dram appreciated
in conditions of cautious monetary-credit and tax-budget policy. The
low index of foreign debt/GDP ratio contributed to receiving a high
rating. This ratio in 2005 made 23%. At that, 90% of the debt was given
by preferential terms, is long-term and has minimum expenditures of
debt service.
According to the sectors of the financial market, in the total
rating of Armenia the possible highest ratings were given for the
reliability of medium-term and long-term bonds, debt in local currency,
bank deposits in local currency. The reliability of bank deposits in
foreign currency in Armenia was also highly appreciated. According to
the conclusions of Moody’s, Armenia has stable development prospect
on the line of all above mentioned ratings.
At the same time, it was mentioned at the press conference that
the unstable regional geopolitical situation, insufficient level of
development of the Armenian securities market, high level of Armenian
economy’s dollarization had a negative impact on the rating given to
Armenia by Moody’s.
To recap, this year Armenia for the first time has received a rating
of reliability as a debtor by the Fitch organization as well.