According to the draft of the 2025 state budget, about 394 billion drams have been allocated to the RA Ministry of Finance under the implementation of the "State Debt Management" program to service the government's debt, which is about 71 billion drams more than the 323 billion drams of the previous year, writes the former chairman of the RA SRC Davit Ananyan.
"At the end of 2024, it is predicted that the government's debt will amount to 5,033.3 billion drams, that is, the growth of the government's debt during 2024 will amount to 461 billion drams, mainly at the expense of domestic debt. It is noteworthy that in the last three years (during 2022/2024) the state (government) the debt increased by 1,063.3 billion drams, mainly due to the increase in the internal debt burden.
Obviously, domestic debt (government borrowing) tends to be more expensive than external borrowing, so from the point of view of evaluating the effectiveness of public finance management, a natural question arises: why does our government tend to take on more expensive debt?
On the other hand, it is quite possible that the real (de facto) credit rating of our country is so low that international financial institutions and foreign investors do not want to provide loans to our country on acceptable terms based on the rules of economic and political prudence.
Such a situation seriously questions the sustainability of the current public finance management strategy and raises questions. have we not crossed the line when the realization of the need to make radical structural changes in the economy and a deep review of economic policy, without political reforms and the settlement of foreign security problems, is enough to increase the credibility of the country on international platforms?
