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WB Country Manager For Armenia Says Proceeds From Second Issue Of Eu

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  • WB Country Manager For Armenia Says Proceeds From Second Issue Of Eu

    WB COUNTRY MANAGER FOR ARMENIA SAYS PROCEEDS FROM SECOND ISSUE OF EUROBONDS SHOULD BE USED TO STIMULATE ECONOMY

    YEREVAN, March 31. / ARKA /. Proceeds raised from the second issue of
    Eurobonds should be used to stimulate the economy, World Bank country
    manager for Armenia Laura Bailey said today.

    She said the World Bank believes it is very important that the proceeds
    be used to stimulate economic activity in the country and assist the
    most vulnerable segments of the population in the next two years.

    She noted that the buildup of external debt is important in terms of
    its ratio to GDP and to where the resources will be directed to.

    According to Ms. Bailey, the best way to use the resources is to
    boost production capacities and incomes and get out of the current
    difficult economic situation.

    According to official data, Armenia raised $487.84 million from the
    second issue of Eurobonds after selling a $500 million 10-year dollar
    bond for only the second time on record on March 19, paying a yield
    of 7.5%. International law firm Cleary Gottlieb Steen & Hamilton
    LLC was hired by the Armenian government to act as an international
    consultant for the issue, while Deutsche Bank, HSBC Bank and JP Morgan
    acted as underwriters.

    Some $205.8 million of the proceeds were used to buy back previous
    dollar bond issue carried out in 2013. Also about 40 billion drams
    will be used to finance Armenia's budget deficit and "neutralize"
    the Russian recession's spillover effects on the Armenian economy.

    According to deputy finance minister Pavel Safaryan, the remaining
    money will be channeled into the Stabilization Fund to enable the
    government to maintain fiscal stability and to fully finance its
    spending items.

    Armenia first issued $700 million worth dollar-denominated bonds in
    September 2013 at the yield of 6.25 percent. According to Armenian
    finance ministry, investors were ready to buy as much as $3 billion
    worth of Armenian external bonds.

    The bulk of $700 million was used to repay a $500 million Russian
    loan ten years ahead of schedule. ($1 - 471.21 drams). --0--

    http://arka.am/en/news/economy/wb_country_manager_for_armenia_says_proceeds_from_ second_issue_of_eurobonds_should_be_used_to_stimul/#sthash.7tNvIOH1.dpuf

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