2024-04-06 16:06:05
Due to the Russian-Ukrainian conflict and external factors, the period of high economic growth of our country in the previous two years is already ending, bringing new future risks and challenges.
Moreover, the recorded high economic growth was never capitalized, did not lead to the improvement of the RA economic structure, and did not turn into a theoretical long-term sustainable growth potential. In addition to all this, there are increasing threats to economic security.
Let me give some indicators of official statistics.
The growth of the indicator of economic activity in 2022 was 14.2%, which is a steady decrease starting from the second quarter of 2023 and closed the year with an indicator of 9.4%.
In 2023, about 2.23 trillion drams were received (entered our country) from abroad in the name of individuals through RA banks, which is only 2% more than the figure of 2022. In 2023, in the same way, 1.6 trillion drams were transferred abroad (left our country), which is already about 483 billion drams or 44% more than the figure of 2022.
In fact, compared to the previous year, in 2023, the growth of money outflow from Armenia in percentage terms is 22 times higher than the growth rate of money inflow to our country.
As a result, in 2023, the positive difference between money inflows and outflows from abroad (net inflow) amounted to 649 billion drams, which is about 441 billion drams or 41% less than the indicator of 2022.
In the classical sense, this characterizes the flight of “hot” money.
It is also noteworthy that after a 47 percent jump in 2022, financial services recorded a double-digit decline in 2023. And this is due to the growth rate of foreign trade turnover, as well as the flight of foreign funds.
In other words, the “bubble bursts” of high economic growth caused by external, random factors. And those in charge of the economy questioned the impact of the rapid increase in the volume of net foreign money inflow on the recorded high economic growth.
Next, in the conditions of two-digit GDP growth, the state debt has continuously and progressively increased in the previous two years. In particular, as of January 1, 2024, the RA state debt amounted to 11.85 billion US dollars. increasing by 11.5% compared to January 1, and by 28.5% compared to January 1, 2022.
After May 2018, during the previous five and a half years of this government’s administration, the public debt increased by about 5.1 billion USD or 75.4%. However, under this government, the average annual index of GDP growth was 5.5%, and the annual growth of the country’s public debt was about 2.5 times more than that, 14%.
In other words, this government has increased the state debt by around 1800 US dollars for each RA citizen.
In 2023, the interest payments paid on the RA government’s debt alone amounted to 253.4 billion drams, which is an increase of 55.1 billion drams or about 28% compared to 2022, and 72.6 billion drams compared to 2021. AMD or by about 40%.
Interest payments on government debt are also showing very worrying high growth trends and are increasingly reducing the real scope for increasing social spending.
In 2023, government debt interest payments made up about 11% of the tax revenues of the state budget of the given year, about 10% of the total expenses, and 36% of the total expenses allocated to social benefits and pensions.
In fact, as we have justified and predicted many times. these authorities keep our country in debt, wasting the future long-term development resource of our country, leaving the burden of skyrocketing debt on the shoulders of generations.
At the same time, the negative trends of the real sector of our country’s economy are deepening, the risks of securing planned tax revenues are increasing. It is for this reason that the government has widely initiated a significant increase in the tax burden of small and medium-sized businesses and the elimination of tax privileges for this sector.
Հեղինակ՝ Tadevos Avetisyan, deputy of the “Armenia” faction of the RA NA, member of the Supreme Body of the ARF
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