Wednesday, November 15 2023 11:17

ArmInfo. The state budget deficit of Armenia in 2024 will amount to 341.1 billion drams (about $880 million, the estimated US dollar exchange rate is 385.9 dr. per $1) or 3.2% of GDP, against 236.8 billion drams or 2.5% of GDP expected by end of this year and 179.5 billion or 2.1%, actual for 2022.

As a result, the government debt/GDP ratio at the end of next  year will be 48.4%.  Maintaining the debt at this level will allow  maintaining the positive trends in the rating of the RA government,  creating an additional "reserve of stability" to withstand possible  future risks, and also having a manageable level of interest payments  on the debt.

According to the forecasts underlying the budget, in 2024, in  conditions of ensuring 7% GDP growth (and in the presence of  favorable external conditions - all 9%), as well as improving the  tax-to-GDP ratio by 0.75 percentage points.., tax revenues of the  state treasury (tax revenues and state duties) will amount to 2  trillion 566 billion 361 million drams (24.4% of GDP), or 342 billion  drams (15.4%) more than the adjusted figure for 2023 (23.7% of GDP).

In general, state treasury revenues will amount to 2 trillion 676  billion drams or 25.5% of GDP, against those expected by the end of  this year. 2 trillion 365 billion drams or 25.1% of GDP (2 trillion  365 billion drams or 24.3% of GDP for 2022). State treasury  expenditures in 2024, compared with the adjusted figure for this  year. will increase by 15.9% or approximately 415 billion drams - up  to 3 trillion 017 billion 437 million drams or 28.7% of GDP (426.5  billion drams more than the approved figure for this year or 27.6% of  GDP).

The deficit of 341.1 billion drams will be financed both from  internal resources - in the amount of 220.3 billion drams, and from  external sources - 120.8 billion drams.

"In 2024, the bulk of internal sources of financing the deficit will  be formed from proceeds from the placement of government securities,  funds from the stabilization deposit account, as well as net income  from budget loans provided to business entities. There are still  significant funds allocated to finance the state budget deficit  through loans from international organizations and foreign countries.  According to forecasts, during the program period, the structure of  external assistance will be dominated by official budget support  grants and loans to finance targeted programs (95.1%)," reads the  2024 budget message.

The total volume of net borrowings to be raised from domestic sources  to finance the deficit in 2024 will be about 350.8 billion drams,  while it is expected that the attraction of borrowed funds will be  fully secured through the issuance of government securities. Net  income from financial assets in 2024 is planned to be about 130.5  billion drams.

The planned total amount of net borrowings from external sources will  be 129 billion drams. These are loans to be provided to the Republic  of Armenia in 2024 from international organizations and foreign  countries (some of which have a clear programmatic focus), loans  already received by the specified date in accordance with the  conditions provided for in loan agreements, repayment amounts and  proceeds from the placement of foreign currency government bonds. Net  income from financial assets in 2024 is planned to be about 8.2  billion drams.

According to the document, the ratio of public debt to GDP at the end  of 2024 will be 50.7%, against those expected by the end of this  year. 49.4% and actual 49.3% for 2022. The government's debt will be  48.4%, instead of the 47% expected for 2023 and the actual one for  last year - 46.7%. In USD terms, the government's debt by the end of  2024 will reach $11 billion 891 million, against the expected $10  billion 900 million for the current year and $10 billion 086 million  for 2022. Domestic debt is planned to increase to 44.3%, against  43.2% expected by the end of 2023 and actual for 2022 - 41.6%. Dram  debt in the structure of government debt will reach 44.4%, instead of  what was expected for this year. 42.7% and actual for last year -  37.9%. In 2024, 805.2 billion drams will be required to service and  repay the government's debt, of which debt repayments will amount to  483 billion drams, and 322.2 billion drams for interest payments or  3.1% of GDP (2.9% per ton). 2.3% - for 2022).