Armenia's budget deficit to grow to 4.5% of GDP in 2024 and drop to 2.9% in 2025 - Fitch

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Economy

29.01.2024, 13:43

Armenia will sharply expand fiscal spending in 2024 in order to integrate the large refugee influx from Nagorno-Karabakh, according to an analyses by Fitch Ratings.

Armenia's budget deficit to grow to 4.5% of GDP in 2024 and drop to 2.9% in 2025 - Fitch

YEREVAN, January 29. /ARKA/. Armenia will sharply expand fiscal spending in 2024 in order to integrate the large refugee influx from Nagorno-Karabakh, according to an analyses by Fitch Ratings.

It says the authorities have allocated about 1.5pp of GDP (including 1pp from the reserve fund) for this purpose in 2024 (2023: 0.7%).

According to the rating agency, despite some permanent revenue-raising measures from 2024, including higher excise taxes on tobacco and alcohol products, revised royalty rates for mining, and new taxes on the gaming sector, as well as continued strong nominal GDP growth, the fiscal deficit will temporarily widen to 4.5% in 2024 (current 'BB' median: 2.8%), before moderating to 2.9% in 2025.

According to the Armenian government budget for 2024 approved by the parliament last December 7, the government expects to collect 2 trillion 723 billion drams in revenue and to spend 3 trillion 206 billion drams. Some 695 billion drams are earmarked as capital expenditures . The budget deficit is projected at about 483 billion drams or 4.6% of GDP. -0-

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