Nikol Pashinyan: I consider the budget 2019 inertial, in the framework of logic of the previous authorities

ArmInfo. "I consider the budget  for 2019 as inertial," Armenian Prime Minister Nikol Pashinyan said  on October 1 during a Facebook broadcast.

In particular, as the prime minister pointed out, the document was  formed within the framework of the logic of the previous authorities.  In any case, according to Pashinyan, the document, approved today or  tomorrow, is not static and may be revised in the process of the  government's work on resolving various issues.

As of today, in the context of increasing the efficiency of state  treasury expenses, Nikol Pashinyan said that the government aims to  significantly reduce the number of official cars and increase the  productivity of the state administration staff. "Without increasing  the efficiency of the state administration system, it will be  difficult to resolve the issue of the republic's  re-industrialization," he explained. In general, as the head of the  government pointed out, the government will gradually move towards  the transformation of Armenia from an agrarian into a technological  country.

To recall, on September 27 the government of Armenia approved the  draft budget for 2019. According to Atom Janjughazyan, Minister of  Finance, the project was developed taking into account several new  circumstances. According to him, the first is the fiscal rules,  according to which the fiscal policy should be implemented, which, in  particular, should have a tendency to stabilize debt. "The logic is  as follows: we will borrow, as a rule, for capital expenditures, we  will not borrow to finance current expenditures," the minister said.  Thus, the consolidated budget for the next year in terms of revenues  is estimated at 1,533.7 billion drams (without revenues from  inter-budgetary transfers), expenses - 1,685.3 billion drams (without  receipts from inter-budgetary transfers), the deficit - 151.6 billion  drams or 2.2% of GDP. Sources of financing the budget deficit will be  53 billion drams - domestic sources, and 98.6 -foreign sources.

Budgets of communities for 2019 are estimated to be 138.9 billion  drams (including official grants from the state budget) of income,  and 138.9 billion drams of expenses. The draft law envisages that in  2019 when making decisions regarding monetary policy, within the  powers granted to it by law, the Central Bank will be guided by a  target of 12-month inflation at 4% with a tolerable limit of  fluctuations of + 1.5%. In 2019, capital expenditure from the current  2.3% of GDP will grow to 3%. State treasury revenues will amount to 1  trillion 462 billion drams, of which tax revenues will be 1 trillion  396 billion drams, expenses - 1 trillion 614 billion drams. Most of  the state budget funds will be directed to the implementation of  programs in the social and cultural fields - 44%. 24% of the total  state budget funds will be spent on solving problems related to  maintaining public order, security and defense, 12.3% are planned to  be invested in the real sector of the economy. In the form of  subsidies to the budgets of local governments, 3.2% of all  expenditures will be sent, and 5.8% - to government agencies. At the  end of 2019, the Armenian government expects GDP growth at 4.9%.   According to the minister, the calculations were made on the basis of  the program of medium-term expenditures for 2019-2021. with some  correction due to internal and external developments.

As the head of the Ministry of Finance noted, initially, according to  the medium-term expenditure program, GDP growth in Armenia for the  next year was forecasted at the level of 5.3%, however, as a result  of the growth adjustments for the current year - from 4.5% to 6.5%,  the forecast for the next year was also revised. Nevertheless, as  Atom Janjughazyan assured, this does not mean that the nominal value  of GDP will decrease, which will grow by 130 billion drams. In 2019,  the government will send 10% of all budget funds to service the  public debt. As the minister pointed out, in 2018, as a result of a  restrained fiscal policy, the ratio of public debt to GDP will be  50.4%. A similar figure is expected by the end of 2019.  To note,  according to the state budget for the 2018, the revenues will be  1.308.2 billion drams, against the approved for 2017 1,210.0 billion  drams and 1,135.9 billion drams registered in 2016. At the same time,  the growth of tax revenues is expected - up to 1, 248. 5 billion  drams. Capital expenditures will amount to 158.7 billion drams,  instead of the previously forecasted 172.4 billion drams (160 billion  in 2016), operating expenses from 1.391.8 billion drams will increase  to 1.306.5 billion drams. Economic growth in 2018 is planned at the  level of 4.5% or $ 11,948.9 million. The deficit is planned in the  amount of 156.9 billion drams. Economic growth for 2018 is planned at  4.5%, and inflation at 4% (+ 1.5%). ($ 1 - 480.37 drams). By the end  of 2018, the national debt will grow to $ 7.2 billion and amount to  60% of GDP.