YEREVAN, September 19. /ARKA/. Now Armenia faces no risks in managing its state debt, Souleymane Coulibaly, World Bank Senior Economist said when presenting the WB report on “Fiscal Consolidation and Recovery in Armenia”.
He pointed out that economic growth in Armenia was an important factor for the fiscal position to remain sustainable and said if the country’s economy continues growing at the same pace, there will be no problems.
Coulibaly said that the World Bank’s opinion is grounded on the consensus baseline scenario of Armenia’s general macroeconomic indicators. He said if macroeconomic indicators develop as per this baseline scenario, the ratio of state debt to GDP will decline over time, which will stabilize the debt burden.
At the same time, Coulibaly said that nobody can predict the impact of external factors on Armenia’s economy.
In its report, the World Bank also says that additional budget-correcting measures should be taken to cut the government’s fiscal deficit, to lessen the state debt and to create some fiscal headroom for possible shocks.
Armenia’s total state debt amounted to $4 billion 252 million in late July 2012. According to the finance ministry’s figures, the country’s foreign debt amounts to $3 billion 708 million and makes up 46% of GDP. Of this amount, $3 billion 100 million are the government’s liabilities and $608 million are the central bank’s liabilities. In the 2012 government budget, economic growth is projected at 4.2% and inflation at 4 ±1.5%. -0-