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  • Yerevan In Search Of More Foreign Loans

    YEREVAN IN SEARCH OF MORE FOREIGN LOANS

    www.asbarez.com/index.html?showarticle=4108 7_4/2/2009_1
    Thursday April 2, 2009

    YEREVAN (RFE/RL)--Armenia is seeking additional loans from foreign
    donors and lending institutions to cushion the growing effects of
    the global economic crisis on its economy, Labor and Social Affairs
    Minister Arsen Hambardzumian said on Thursday.

    Hambardzumian said the Armenian government is currently negotiating
    with the World Bank, the International Monetary Fund, the Manila-based
    Asian Development Bank and other potential lenders for that purpose.

    "We have already gone through a certain negotiating process," he
    told RFE/RL. "There is a readiness, there are programs that have
    been tentatively approved. But there are some issues that require
    further discussion."

    The World Bank and the IMF pledged earlier this year to allocate
    a total of over $1 billion in anti-crisis loans to Armenia in the
    coming years. Some of these loans worth roughly $320 million have
    already been disbursed. The Armenian government is also expected to
    receive a $500 million "stabilization credit" from Russia by June.

    Hambardzumian did not specify the amount of extra funds sought by
    Yerevan and how it plans to spend them. He said only that the money
    is meant to ease "social tension" in the country.

    The Armenian economy contracted in the first quarter of this year
    for the first time since the early 1990s, resulting in a sizable drop
    in the government's tax revenues. Citing the revenue shortfall, the
    government decided last week to delay 14 percent of its expenditures
    envisaged by the 2009 state budget until the fourth quarter.

    Vartan Bostanjian, deputy chairman of the Armenian parliament's
    economic committee, admitted that the move is a prelude to a downward
    revision of the budgetary targets. "In reality this is nothing but
    a cut in expenditures which is called a sequestration," he said.
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