Armenia's 2025 budget introduces mechanism for carrying over unrealized capital expenditures to next year - Finance Ministry
YEREVAN, March 24. /ARКА/. For the first time, a mechanism for carrying over unrealized commitments on contractual capital expenditures to the next budget year has been introduced in Armenia's 2025 state budget, Finance Minister Vahe Hovhannisyan said.
"This is a significant step in terms of increasing the efficiency of budget expenditures. For the first time, the budget also sets three-year macroeconomic and fiscal frameworks, which is a step towards developing a three-year budget, which we plan to implement from 2026," Hovhannisyan said at a meeting of the parliamentary commission on financial, credit and budgetary issues on Monday.
According to him, in 2024, the state budget was executed by 95.8% in terms of revenues (of which tax revenues and state duties were fulfilled by 92.7%), and by 93.9% in terms of expenditures. These figures are 9.3% and 16% higher compared to 2023, respectively.
The Minister also said that Armenia's public debt at the end of 2024 amounted to 5 trillion drams or about $12.8 billion, an increase of 6.2% compared to 2023. "However, it is encouraging that the public debt to GDP ratio remained below 50%, amounting to 48.3%. This is 0.1% lower than in 2023," Hovhannisyan said.
The Minister said that a number of improvements have been made to the macroeconomic forecasting system, and scenario analyses have been introduced, which make it possible to understand the impact on macroeconomic indicators.
"The tax to GDP ratio was 23.6%, down 0.45 percentage points compared to 2023, but over 7 years, the ratio has improved by 2.8 percentage points. — from 20.8% to 23.6%. For the first time, revenues were also provided for by types of taxes in the 2024 state budget,” Hovhannisyan noted.
The minister also said that it is planned to attract budget loans under 4 programs for a total of $322.5 million. The Stand-By Agreement with the IMF, which will end in 2025, is being implemented, but it is planned to be extended.
“Six targeted loan programs worth $850 million were concluded, six grant agreements worth $40 million were also signed, grants in the amount of $16 million were received from the Global Concessional Financing Facility (GCFF, a WB structure) to co-finance the program for internally displaced persons from Nagorno-Karabakh,” Hovhannisyan concluded. ($1 - 392.54 drams).
