Armenia set to issue foreign currency-denominated bonds

16.05.2013 16:12
Armenia set to issue foreign currency-denominated bonds

YEREVAN, May 16. / ARKA /. The Armenian government on Thursday approved the concept for issuing foreign currency-denominated bonds.

"Today we are taking a political decision, and for the first time we will start issuing foreign currency –denominated bonds. This will open a new page in the economic policy of Armenia not only in terms of public funds management, but will also provide the private sector with an opportunity to attract cheaper funds from international financial markets," prime minister Tigran Sargsyan said.
He cited international organizations and financial institutions working with Armenian economic entities as saying that since Armenia does not issue foreign currency-denominated bonds, attraction of additional financial resources is always 1-1.5% more expensive.

The prime minister added that due to successful placement of bonds this year and attracting cheaper funding from external sources next year, the government plans to repay the $500 million Russian stabilization loan.

"We have started a dialogue with our Russian partners and have their consent and cooperation so that the repayment of the loan is smooth, if the interest rates are softer than those envisaged by our interstate agreement", he said.

Sargsyan said for issuance of foreign-currency denominated bonds the government t needs professional assistance and that is why it approved a decision to sign a contract with Cleary Gottlieb Steen & Hamilton LLC.

According to official data, Armenia’s state debt stood as of March 31 at $4.2 billion, of which $3.597 billion were external debt. -0-

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