Impact of Financial Crisis on Armenia
EurasiaNet, NY
March 13 2009
ARMENIA TIGHTENING ITS BELT
3/13/09
Armenia is shifting budgetary priorities and spending schedules to
brace the country for worse economic times ahead. "In the light of the
crisis, we have to economize and spend just as much as we can collect
through taxes," Armenian Prime Minister Tigran Sargsyan was quoted by
the ArmInfo news agency as saying on March 12.
At a government meeting, it was decided to move the "riskiest"
budgetary revenues and expenditures toward the end of the year. The
funding of state bureaucracy, acquisition of real estate and some
government projects will be trimmed, if not halted, ArmInfo reported,
without elaborating.
Finance Minister Tigran Davtian told a press briefing on March 12 that
in the first half of 2009 the treasury may fall short of its target
income by as much as $354 million. Davtian said that the International
Monetary Fund's recently approved $540 million loan combined with $525
million from the World Bank and another $500 million loan tentatively
pledged by Russia would help Armenia through what could prove to be a
financially tumultuous year.
March 13 2009
ARMENIA TIGHTENING ITS BELT
3/13/09
Armenia is shifting budgetary priorities and spending schedules to
brace the country for worse economic times ahead. "In the light of the
crisis, we have to economize and spend just as much as we can collect
through taxes," Armenian Prime Minister Tigran Sargsyan was quoted by
the ArmInfo news agency as saying on March 12.
At a government meeting, it was decided to move the "riskiest"
budgetary revenues and expenditures toward the end of the year. The
funding of state bureaucracy, acquisition of real estate and some
government projects will be trimmed, if not halted, ArmInfo reported,
without elaborating.
Finance Minister Tigran Davtian told a press briefing on March 12 that
in the first half of 2009 the treasury may fall short of its target
income by as much as $354 million. Davtian said that the International
Monetary Fund's recently approved $540 million loan combined with $525
million from the World Bank and another $500 million loan tentatively
pledged by Russia would help Armenia through what could prove to be a
financially tumultuous year.
IMF forecasts about 1.5% economic recession in Armenia in 2009 are realistic
YEREVAN, MARCH 13, NOYAN TAPAN. The IMF's forecasts that 1.5% economic
recession will be recorded in Armenia in 2009 are realistic, the
minister of finance Tigran Davtian said at the briefing after the March
12 sitting of the government.
"We have planned Armenia's budget with quite a low deficit - below 1%,
we have quite a small foreign debt, and its ratio to GDP does not
exceed 14-15%. It means that we have an opportunity to increase the
budget deficit and attract additional foreign sources for deficit
financing," T. Davtian said, adding that the negotiations with the
World Bank, the U.S. and Russia on attraction of financial resources
have finished.
It was mentioned the tax revenue collection in January and February
2009 declined by 5 billion drams and 10 billion drams respectivley as
compared with the same months of 2008. However, according to the
minister, there have been some positive changes in March.
YEREVAN, MARCH 13, NOYAN TAPAN. The IMF's forecasts that 1.5% economic
recession will be recorded in Armenia in 2009 are realistic, the
minister of finance Tigran Davtian said at the briefing after the March
12 sitting of the government.
"We have planned Armenia's budget with quite a low deficit - below 1%,
we have quite a small foreign debt, and its ratio to GDP does not
exceed 14-15%. It means that we have an opportunity to increase the
budget deficit and attract additional foreign sources for deficit
financing," T. Davtian said, adding that the negotiations with the
World Bank, the U.S. and Russia on attraction of financial resources
have finished.
It was mentioned the tax revenue collection in January and February
2009 declined by 5 billion drams and 10 billion drams respectivley as
compared with the same months of 2008. However, according to the
minister, there have been some positive changes in March.
Armenian premier: It is for the first time over several last years that
economy falling was registered in Armenia in January
2009-03-13 19:09:00
ArmInfo. It is for the first time over several last years that economy
falling was registered in Armenia in January, Armenian Prime Minister
Tigran Sarkisyan told journalists.
He also added naturally economy falling reflected indices of the tax
revenues, which is connected with worsening of the export-import
indexes. Unfortunately, the predictions on quick overcoming of the
world financial crisis did not justify themselves. `Today we do not
have a strict position on the matter when to expect ending of the world
crisis', - the premier said and added that on the basis of assessments
the restoration stage will begin at the end of 2009 and we have to wait
for stable development of economy in 2010. As for Armenia, Sarkisyan
mentioned the programmes which will be financed by international
financial institutions. First of all, he means financing of the real
sector of economy - road construction, agriculture investments,
crediting of small and medium-sized business. A part of the Russian
credit $500 mln will be directed to financing of programmes of small
and medium-sized business, which will also lead to activation of
economy. `We have to do everything possible to receive the funds as
soon as possible. This will make it possible to start fulfillment of
the programme as soon as possible', - Sarkisyan said.
economy falling was registered in Armenia in January
2009-03-13 19:09:00
ArmInfo. It is for the first time over several last years that economy
falling was registered in Armenia in January, Armenian Prime Minister
Tigran Sarkisyan told journalists.
He also added naturally economy falling reflected indices of the tax
revenues, which is connected with worsening of the export-import
indexes. Unfortunately, the predictions on quick overcoming of the
world financial crisis did not justify themselves. `Today we do not
have a strict position on the matter when to expect ending of the world
crisis', - the premier said and added that on the basis of assessments
the restoration stage will begin at the end of 2009 and we have to wait
for stable development of economy in 2010. As for Armenia, Sarkisyan
mentioned the programmes which will be financed by international
financial institutions. First of all, he means financing of the real
sector of economy - road construction, agriculture investments,
crediting of small and medium-sized business. A part of the Russian
credit $500 mln will be directed to financing of programmes of small
and medium-sized business, which will also lead to activation of
economy. `We have to do everything possible to receive the funds as
soon as possible. This will make it possible to start fulfillment of
the programme as soon as possible', - Sarkisyan said.
Culmination of crisis to be noticeable in Armenia in autumn
YEREVAN, MARCH 13, NOYAN TAPAN. In modern history of Armenia, 2009 will
be the hardest year for the country's economy, the former chairman of
the Central Bank of Armenia (CBA) Bagrat Asatrian erxpressed an opinion
at the March 12 meeting with reporters. By his forecasts, very high
inflation and over 10% economic decline are expected this year.
B. Asatrian said that the 20% economic decline recorded in the 4th
quarter of 2008 bore evidence of the trends expected in 2009, and both
the government and the National Assembly were well aware of it.
However, a state budget envisaging a considerable economic growth and a
socioeconomic development program were approved despite this fact.
In his opinion, the growth in power and gas tariffs from April will
cause a chain reaction of a rise in prices of other goods, with the
volume of that reaction being hardly predictable.
The speaker noted that the global financial and economic crisis has not
yet left a considerable impact on Armenia, and its consequences will
become most noticeable in the country from the autumn of 2009 to the
spring of 2010. In particular, according to B. Asatrian, a fall in
remittances is expected, which has not been recorded so far.
Armenian government shifts to strict regime of savings
YEREVAN, MARCH 13, NOYAN TAPAN. "The Armenian government should shift
to a strict regime of savings, we should save state resources and spend
in line with our revenues," the prime minister Tigran Sargsyan stated
at the March 12 sitting of the government. In his words, the data of
the National Statistical Service show that GDP indices sharply worsened
in January which means "we must be prepared for the worst scenario".
T. Sargsyan said that no one today can make forecasts about further
developments in the global economy as a result of the crisis. So,
according to him, it is necessary to adopt the principle of quarterly
budget planning and to plan expenditures based on it. The prime
minister pointed out that expenditures should be reduced, but in
conditions of such savings, social expenditures: benefits, pensions,
salaries should be protected. "Strict savings must be ensured with
respect to other expenditures," he underlined.
He expressed an opinion that numerous difficulties will arise in terms
of both domestic and foreign functions. "We must overcome, there is no
other way as the global economy is developing by a not good scenario.
The forecasts of the Central Bank of Armenia and the IMF are regularly
revised and changed in a not positive direction. We should save and
spend as much as we are able to collect in taxes," he noted.
The minister of finance Tigran Davtian said that taxes-GDP ratio should
be increased by 0.4% to 17.4% this year. "There is no other way," the
minister said. In his words, expenditures should be redistributed
rather than reduced, and several expenditures should be transferred to
some other period. The formation of 2010-2012 medium-term expenditure
programs has been temporarily suspended.
The prime minister instructed all the ministries and departments to
submit proposals on efficient budgetary expenditures within 5 days.
YEREVAN, MARCH 13, NOYAN TAPAN. In modern history of Armenia, 2009 will
be the hardest year for the country's economy, the former chairman of
the Central Bank of Armenia (CBA) Bagrat Asatrian erxpressed an opinion
at the March 12 meeting with reporters. By his forecasts, very high
inflation and over 10% economic decline are expected this year.
B. Asatrian said that the 20% economic decline recorded in the 4th
quarter of 2008 bore evidence of the trends expected in 2009, and both
the government and the National Assembly were well aware of it.
However, a state budget envisaging a considerable economic growth and a
socioeconomic development program were approved despite this fact.
In his opinion, the growth in power and gas tariffs from April will
cause a chain reaction of a rise in prices of other goods, with the
volume of that reaction being hardly predictable.
The speaker noted that the global financial and economic crisis has not
yet left a considerable impact on Armenia, and its consequences will
become most noticeable in the country from the autumn of 2009 to the
spring of 2010. In particular, according to B. Asatrian, a fall in
remittances is expected, which has not been recorded so far.
Armenian government shifts to strict regime of savings
YEREVAN, MARCH 13, NOYAN TAPAN. "The Armenian government should shift
to a strict regime of savings, we should save state resources and spend
in line with our revenues," the prime minister Tigran Sargsyan stated
at the March 12 sitting of the government. In his words, the data of
the National Statistical Service show that GDP indices sharply worsened
in January which means "we must be prepared for the worst scenario".
T. Sargsyan said that no one today can make forecasts about further
developments in the global economy as a result of the crisis. So,
according to him, it is necessary to adopt the principle of quarterly
budget planning and to plan expenditures based on it. The prime
minister pointed out that expenditures should be reduced, but in
conditions of such savings, social expenditures: benefits, pensions,
salaries should be protected. "Strict savings must be ensured with
respect to other expenditures," he underlined.
He expressed an opinion that numerous difficulties will arise in terms
of both domestic and foreign functions. "We must overcome, there is no
other way as the global economy is developing by a not good scenario.
The forecasts of the Central Bank of Armenia and the IMF are regularly
revised and changed in a not positive direction. We should save and
spend as much as we are able to collect in taxes," he noted.
The minister of finance Tigran Davtian said that taxes-GDP ratio should
be increased by 0.4% to 17.4% this year. "There is no other way," the
minister said. In his words, expenditures should be redistributed
rather than reduced, and several expenditures should be transferred to
some other period. The formation of 2010-2012 medium-term expenditure
programs has been temporarily suspended.
The prime minister instructed all the ministries and departments to
submit proposals on efficient budgetary expenditures within 5 days.
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