YEREVAN, September 8. /ARKA/. ‘While we expect central government debt to remain below 50 percent of GDP in the medium term, the outcome would depend upon the implementation of a gradual fiscal consolidation supported by prioritization of spending and revenue mobilization measures,’ Head of Middle East and Central Asia Department at the International Monetary Fund (IMF), said in an exclusive interview with ARKA news agency.
He said the public debt declined very sharply in 2022 and in 2023H1 and the the government debt stood at 42.7 percent of GDP in the first half of 2023.
‘Furthermore, Armenia’s debt has historically been vulnerable to growth and exchange rate shocks, and any adverse shock to the outlook could put significant upward pressure on debt. Therefore, fiscal policies need to remain prudent to keep central government debt at moderate levels,’ Azour said.
Armenia’s total public debt as of July 31, 2023 stood at over $11.3 billion, an increase of $247.5 million compared to June 30, 2023. Over $6, 6 billion of that amount was the government’s external debt, which upped by $225.3 million from the previous month. The domestic debt increased by $22.279 mln to about $4, 7 billion in late August 2023.
Analysts at S&P Global Ratings expect that Armenia’s public debt will average 42% of GDP in 2023-2026. Fitch expects it to stabilize at around 44.6% in 2023-2025, down from its pre-pandemic level of 53.7% in 2019. -0-
