Armenia’s public debt is projected to rise to about $7.5 billion next year as a result of more borrowing planned by its government, a senior official from the Finance Ministry said on Wednesday.
According to ministry data, the government and the Central Bank of Armenia owed a total of $6.77 billion to mainly foreign creditors as of November 30. Finance Minister Atom Janjughazian said earlier that their combined debt will reach $7.1 billion before the end of this year. The figure would be equivalent to around 55 percent of Gross Domestic Product.
“If all projections made by us … materialize the state debt will make up approximately $7.5 billion at the end of 2019,” said Arshaluys Markarian, the head of a Finance Ministry department on public debt management. “Just over $6.9 billion of that will be the government’s debt.”
Markarian told RFE/RL’s Armenian service (Azatutyun.am) that the government plans to obtain about $490 million in fresh loans in 2019.
The Armenian state budget for next year sets aside $735 million for debt servicing. The sum will account for over one-fifth of the government’s overall budgetary expenditures.
In Markarian’s words, debt repayments will peak at $800 million in 2020 mainly because of Eurobonds issued by the former Armenian government in 2013. They are projected to fall in the following years but rise again to $730 million in 2025, he said.
“I wouldn’t advise anyone to get fixated on these figures and be worried about them because if Armenia is already in the international financial markets it will have a constant presence there,” added the official.
Janjughazian similarly downplayed the rising public debt at an October 4 news conference in Yerevan. The finance minister argued that it will fall as a share of GDP in 2019.
The debt rose by $863.5 million in 2016 and by another $832.5 million in 2017. It totaled just $1.9 billion before the 2008-2009 global financial crisis that plunged the county into a severe recession.