YEREVAN, November 2. /ARКА/. Armenia’s draft state budget for 2027 envisages the formation of a reserve fund of 0.3-0.6% of GDP, announced Martin Galstyan, Chairman of the Central Bank of Armenia.
Presenting the Central Bank’s conclusion on the draft budget to parliament, Galstyan noted that, to manage fiscal risks, a liquidity buffer of at least 1% of GDP is also envisaged in the treasury stabilization account.
According to him, the draft budget includes an analysis of the risks and uncertainties associated with possible deviations from the underlying macroeconomic assumptions and forecasts.
He noted that the scenario analysis assessed possible adjustments to budget flows and fiscal policy parameters should the relevant risks materialize. The regulator’s head stated that if unfavorable circumstances arise, additional tax administration measures are envisaged, expenditure priorities and frameworks are revised, and if fiscal sustainability is significantly impacted, the medium-term parameters of fiscal policy may also be revised.
Galstyan emphasized that these mechanisms are important prerequisites for effective fiscal risk management.
At the same time, he stated, clear restrictions on the use of reserve funds must be observed, primarily directing their resources to cover additional financing needs arising from pre-determined macroeconomic and other significant fiscal risks.
The head of the Central Bank also noted the importance of creating additional fiscal buffers in the current favorable economic conditions to ensure macroeconomic stability and fiscal flexibility in the medium term.
