Armenia's state debt topped 56% of GDP in 2016: Fitch Ratings
Armenia's state budget in 2016 constituted 56.8% of GDP, Fitch Ratings reports.
In line with Armenia's state budget, the country's state debt in 2016 would make 49.4% of GDP. In 2015 the overall state debt of Armenia made 48.8% of GDP, 1in.am reports.
Armenian Finance Ministry reported earlier that the country's state debt for 2016 grew $857.1mln or 17% to settle at $5.934bn.
Under existing law, the state debt of Armenia cannot exceed 60% of GDP, while this limit spreads only to the government's debt without covering the CB borrowings. All the same, in line with the law, if the state debt of Armenia tops 50% of GDP, the government needs to cut spending and the budget deficit cannot top 3% of GDP
The state budget deficit for 2017 is set at 2.8% of GDP. However, Fitch predicts a higher deficit of 3.7% of GDP, since economic growth will be restored only gradually, while current spending will hardly reduce relative to GDP.
Fitch notes that the state budget deficit of Armenia rose to 5.6% of GDP in 2016 from 4.8% of GDP in 2015, which is much higher than the target indicator of 3.5%.