Armenia assessed to be at low risk of debt distress

11.01.2013 19:11
Armenia assessed to be at low risk of debt distress

YEREVAN, January 11. /ARKA/. According to the recent Bank-Fund Debt Sustainability Assessment (DSA), Armenia is assessed to be at a low risk of debt distress, with all debt indicators (total debt to GDP, debt service to export, debt service to budget revenues) below the country-specific thresholds under the baseline scenario, Jean-Michel Happi, the World Bank’s Country Manager for Armenia, said in an interview with ARKA News Agency.

“Armenia’s public sector debt profile is not risky and is projected to remain sustainable,” he said adding that this has been largely supported by the strict measures introduced by the government after the recent crisis - monitoring of the external debt and downsizing the budget deficit through consolidation of public spending.

“In practice the government declared moratorium on borrowing for technical assistance and on non-concessional terms and implemented more disciplined fiscal policy,” he said stressing that this policy will need to be pursued over the medium-term future as well given current uncertainties in the Eurozone area and possible external shocks to Armenia, the necessity to create additional macroeconomic buffers, and limited availability of concessional financing.
According to the Armenian finance ministry, the country’s state debt amounted to $4 billion 374.9 million in late 2012.

Its foreign debt amounted to $3 billion 159 million (31.1% of GDP) against $2 billion 950 million in 2011. -0---

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