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Reporters were introduced to the reforms implemented by the Ministry of Finance
09.12.2019
Reporters were introduced to the reforms implemented by the Ministry of Finance

On December 7-8, in Hankavan the RA Ministry of Finance organized a seminar for journalists covering the field. In the course of the seminar, the RA Minister of Finance Atom Janjughazyan presented  the “The RA Public Finance Management System Strategy for 2019-2023”, hold a concluding press conference, and officials of various sectors of the Ministry presented the changes and reforms implemented during the year.

While presenting the Strategy approved by the Government on November 28, the Minister outlined the vision, goals and action plan of the reforms in the public finance management system.

The vision of the public finance management system is to ensure a fair distribution of public good, for which a targeted, efficient and cost-effective use of public good and integrity of transparency, accountability and control are needed.

According to the Minister, one of the goals of the reforms of the public finance management system is to increase fiscal discipline.

"Although the strategy has recently been approved by the Government, we have for many years considered fiscal policy as a priority. When presenting draft budgets, we have emphasized the fiscal policy itself, since it is assumed that it will adequately respond to the needs of the economy in the given period. Without fiscal discipline, as with no discipline in any area, success cannot be achieved. This is the most important precondition”, - Atom Janjughazyan emphasized.

After presenting the strategy, the Minister answered the journalists' questions.

Eduard Hakobyan, Head of Macroeconomic Policy of the RA Ministry of Finance, presented the macroeconomic framework of the 2020 budget and fiscal policy. According to him, economic growth is projected at 4.9% in 2020 and will be mainly driven by domestic demand, and net exports will gradually improve. E. Hakobyan said that the purpose of the fiscal policy implemented in the country is to ensure macroeconomic stability and economic growth, income redistribution and social security, provision of public goods, as a result of which the welfare of the society can be increased. According to him, the 2020 state budget is in line with these goals as it provides fiscal and debt sustainability and forms the basis for long-term economic growth by substantially improving investment in infrastructure and human capital.

Ruzanna Gabrielyan, Acting Head of the Budget Process Organization Department at the Ministry of Finance of the Republic of Armenia, presented the 2020 budget adopted by the National Assembly, the main accents of the document, and the financial expectations for next year. According to her, the draft state budget of 2020 envisages about AMD 102 billion of capital expenditures or about 1.3 percentage points of GDP improvement reaching the level of 4.1 percent.

R. Gabrielyan noted that 42.2 percent of the state budget is social spending, while the sector includes healthcare, social, defense, culture, sports, and the real sector financial programs make up 14.7 percent of the budget.

In the first part of the seminar-discussion Artur Hambardzumyan, Head of Strategy and Risk Management Division of the Public Debt Management Department of the Ministry of Finance, presented Armenia's state debt and the steps taken to pay it off. Thus, according to A. Hambardzumyan, the state debt of Armenia as of October 31, 2019 is AMD 3.389 billion, of which the Government debt is AMD 3.144 billion, and the external debt of the Central Bank is AMD 245 billion. “In 2020, the Government debt is projected to grow at a slower pace than in previous years, as a result of which the debt-to-GDP ratio will decline by 1.4 percentage points compared to the end of 2019”, - A. Hambardzumyan noted.

Samvel Khamvelyan, Head of Operational Division of the Department of Public Debt Management of the Ministry of Finance, spoke about the terms of the Eurobond placement, as well as presented the operations in the market of monetary bonds. According to the presented statistics, the volume of outstanding treasury bonds as of November 30, 2019, made AMD 681 billion, which may increase by AMD 3 billion by the end of the year.

Major changes in the field of public procurement were presented to journalists by First Deputy Minister of Finance Karen Brutyan and Head of the Department of Procurement Policy Sergey Shahnazaryan. The latter spoke in particular of the requirements of the Government Decision N 526-N concerning the procurement process reforms that has been in force since November 2.

Answering journalists' questions, Karen Brutyan informed that in the nearest future the best electronic procurement system to meet the needs of Armenia will be introduced. “An absolutely new system will be created”, - the Deputy Minister said.

The second day of the seminar was dedicated to the presentation of tax reforms in Armenia. Deputy Minister of Finance Arman Poghosyan and Head of Revenue Policy and Administration Methodology Department Ori Alaverdyan presented the recent amendments to the Tax Code that will come into force on January 1, 2020.

Each speaker answered the journalists' questions after presenting a report on sector reforms and changes. The workshop with the participation of Ministry of Finance staff and journalists was organized with the support of GIZ.