At the sitting, dated September 30, the RA Government approved the draft Law "On the State Budget of the Republic of Armenia for 2022". The draft was presented to the Government by the RA Minister of Finance Tigran Khachatryan.
Below is the full speech of the Minister of Finance:
“Honorable Prime Minister,
Dear Colleagues,
The draft state budget for 2022 is submitted to the Government for consideration. It was drafted on the basis of the priorities of the RA Government Program for 2021-2026 and presents the financial document, which should guarantee the implementation of the programs and measures envisaged for 2022 in the direction of carrying out the Government program.
Before talking about the content of the general financial document of the year, I would like to briefly explain how the budget process was organized. The planning of the 2022 budget was guided by the goals and priorities of the Government program, and, accordingly, the main financial document contains the programs and measures that are directly related to the targets set by the Government program.
The Government program targets long-term high economic growth of at least 7% per year. Therefore, the measures of economic, infrastructural, educational and social significance envisaged by the draft budget have been chosen in such a way as to create the best environment for achieving the above-mentioned economic target in 2022 and in the following years, given the limitations on public financial resources.
The government program has highlighted the increase of the state financial capacity and, in this regard, the policy of significantly increasing tax revenues. The purpose of the tax revenues defined by the state budget for 2022 is its reflection. It is predicted that the tax/GDP ratio should improve by about 0.9 percentage point during the year and reach 23.4% of GDP by the end of 2022.
The budget program directly reflects the priority of ensuring macroeconomic stability and manageable level of public debt related to it. It is envisaged that the state budget deficit will be about 3.2% of GDP and the public debt 60.2% as a result of attracting loans to finance other capital expenditures of infrastructure and economic development planned for the year.
The total budget expenditures for 2022 will make AMD 2188.5 bln or 27.8% of GDP. It is 18.2% more than the expenses approved by the state budget of the previous year.
State funds for economic and social infrastructure improvement will record unprecedented high growth, they will make about AMD 350 bln in 2022. Irrigation infrastructure development works, including implementation of new reservoir construction projects will get a great impulse. Financial allocations for interstate, national and local highways will remain high. Construction and renovation of social infrastructure - schools, pre-school institutions will be greatly increased.
The total amount of budget allocations for infrastructure and territorial development programs will make AMD 278.6 bln, which is 31.6% more than the approved funding of the previous year.
Funding for education, science, culture, sports will amount to AMD 223.3 bln, which is 27.4% more than compared with the previous year. The sum of allocations envisaged per programs related to different levels of education during the year is AMD 171.1 bln, which is 23.6% more than approved by the previous year budget. AMD 25.1 bln will be allocated for the financing of science programs, which is about 83% more than allocated in 2021 by the approved budget.
Funding for social security programs is envisaged AMD 579.9 bln, which exceeds the amount approved by the 2021 budget by 15.1%. It is noteworthy that the increase planned for this year targets especially the protection of the most vulnerable social groups, as well as includes new projects aimed at demographic improvement.
Before concluding, I would like to note that the 2022 state budget in many cases includes new project initiatives, which, being in the start-up phase, create basis for ensuring large-scale developments in the same directions in the coming years.
I would also like to mention that 2022 will be a period of refinement and improvement of the mechanisms and regulations that serve the implementation of the programs envisaged by the budget, as a result, we intend to increase the efficiency of programs implemented with public funding. By solving the problems related to the specifics of the content of each of the programs, we must achieve higher efficiency of public expenditures and quality results”.