Tweet
IMF EXECUTIVE BOARD COMPLETES FIFTH REVIEW UNDER ARMENIA'S PRGF ARRANGEMENT AND APPROVES US$5.2 MILLION DISBURSEMENT
ARMENPRESS
Nov 27, 2007
YEREVAN, NOVEMBER 27, ARMENPRESS: The Executive Board of the
International Monetary Fund (IMF) has completed the fifth review of
Armenia's economic performance under the three-year Poverty Reduction
and Growth Facility (PRGF) arrangement, IMF said in a press release.
The Executive Board also approved a request for modifying the
end-December 2007 structural performance criterion on the tax filing
process. The completion of the review enables the release of an
amount equivalent to SDR 3.28 million (about US$5.2 million) under
the arrangement, bringing the total amount drawn under the arrangement
to an amount equivalent to SDR 19.68 million (about US$31.4 million).
The PRGF is the IMF's concessional facility for low-income
countries. PRGF-supported programs are based on country-owned poverty
reduction strategies adopted in a participatory process involving
civil society and development partners and articulated in the country's
Poverty Reduction Strategy Paper.
This is intended to ensure that PRGF-supported programs are consistent
with a comprehensive framework for macroeconomic, structural, and
social policies to foster growth and reduce poverty. PRGF loans
carry an annual interest rate of 0.5 percent and are repayable over
10 years with a 5½ -year grace period on principal payments.
Following the Executive Board's discussion on Armenia, Mr. Takatoshi
Kato, Deputy Managing Director and Acting Chair, stated: "Armenia
continues to benefit from a double-digit rate of growth, moderate
inflation, a low fiscal deficit, and a comfortable reserves position.
Moreover, good progress has been made in reducing poverty. Strong
remittance inflows have dampened the impact of rapidly rising imports
on the current account deficit. The medium-term outlook is positive,
with a favorable outlook for investment.
"Sound fiscal and monetary policies will remain key to macroeconomic
stability and external competitiveness, against the background of
large-scale foreign exchange inflows and rising inflationary risks. The
Central Bank of Armenia is committed to tightening monetary policy to
keep inflation low, while maintaining a flexible exchange rate regime.
"Emerging expenditure pressures associated with pension reform and
a potential hike in gas import prices create medium-term fiscal
risks, calling for improved revenue mobilization and expenditure
prioritization. Increasing the tax-to-GDP ratio in a transparent and
nondiscretionary manner will be particularly important, to provide
resources for the country's infrastructure needs and efforts to reduce
poverty further.
"The authorities intend to press ahead with their structural
reform agenda to remove remaining bottlenecks to broad-based
growth. Policies aimed at boosting domestic competition and
productivity are essential to improve external competitiveness. The
tax administration modernization program will contribute to reducing
tax evasion and strengthening the business environment," Mr. Kato said.
--Boundary_(ID_+J11rszElEzfciHFnSp3Jg)--
ARMENPRESS
Nov 27, 2007
YEREVAN, NOVEMBER 27, ARMENPRESS: The Executive Board of the
International Monetary Fund (IMF) has completed the fifth review of
Armenia's economic performance under the three-year Poverty Reduction
and Growth Facility (PRGF) arrangement, IMF said in a press release.
The Executive Board also approved a request for modifying the
end-December 2007 structural performance criterion on the tax filing
process. The completion of the review enables the release of an
amount equivalent to SDR 3.28 million (about US$5.2 million) under
the arrangement, bringing the total amount drawn under the arrangement
to an amount equivalent to SDR 19.68 million (about US$31.4 million).
The PRGF is the IMF's concessional facility for low-income
countries. PRGF-supported programs are based on country-owned poverty
reduction strategies adopted in a participatory process involving
civil society and development partners and articulated in the country's
Poverty Reduction Strategy Paper.
This is intended to ensure that PRGF-supported programs are consistent
with a comprehensive framework for macroeconomic, structural, and
social policies to foster growth and reduce poverty. PRGF loans
carry an annual interest rate of 0.5 percent and are repayable over
10 years with a 5½ -year grace period on principal payments.
Following the Executive Board's discussion on Armenia, Mr. Takatoshi
Kato, Deputy Managing Director and Acting Chair, stated: "Armenia
continues to benefit from a double-digit rate of growth, moderate
inflation, a low fiscal deficit, and a comfortable reserves position.
Moreover, good progress has been made in reducing poverty. Strong
remittance inflows have dampened the impact of rapidly rising imports
on the current account deficit. The medium-term outlook is positive,
with a favorable outlook for investment.
"Sound fiscal and monetary policies will remain key to macroeconomic
stability and external competitiveness, against the background of
large-scale foreign exchange inflows and rising inflationary risks. The
Central Bank of Armenia is committed to tightening monetary policy to
keep inflation low, while maintaining a flexible exchange rate regime.
"Emerging expenditure pressures associated with pension reform and
a potential hike in gas import prices create medium-term fiscal
risks, calling for improved revenue mobilization and expenditure
prioritization. Increasing the tax-to-GDP ratio in a transparent and
nondiscretionary manner will be particularly important, to provide
resources for the country's infrastructure needs and efforts to reduce
poverty further.
"The authorities intend to press ahead with their structural
reform agenda to remove remaining bottlenecks to broad-based
growth. Policies aimed at boosting domestic competition and
productivity are essential to improve external competitiveness. The
tax administration modernization program will contribute to reducing
tax evasion and strengthening the business environment," Mr. Kato said.
--Boundary_(ID_+J11rszElEzfciHFnSp3Jg)--