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RA PARLIAMENT RATIFIES AGREEMENT ON PROVISION OF STATE CREDIT OF 500M USD BY RF
Noyan Tapan
June 3, 2009
YEREVAN, JUNE 3, NOYAN TAPAN. On June 2, the RA National Assembly
ratified the agreement signed between the RA and RF governments on
2009 May 20 in Moscow on provision of state credit to RA. According
to it, a credit of 500m USD will be provided to Armenia.
According to the main reporter, RA Minister of Finance Tigran Davtian,
the credit can be assessed as "soft," beneficial for Armenia. It is
provided by 15 years' term, without the repayment obligation in the
first four years.
The Armenian side will repay the debt in 2013-2024 with equal six
months' shares and for using the credit will pay to the Russian
side for 6-month deposits LIBOR rate plus 3 percent annual interest
rate. According to the Minister, at the moment LIBOR rate is 1.22,
that is, the interest rate to be paid is 4.22.
One part of the credit will be spent on financing the budget deficit
and the other part will be used for anti-crisis measures: crediting
of small and medium-sized, as well as system-creating enterprises,
implementation of restoration work in the earthquake zone, formation
of a Stabilization Fund at the Central Bank of Armenia.
The Zharangutiun faction voted against agreement's
ratification. Faction head Armen Martirosian said that it is
inadmissible to take such a credit without government's exact actions
aimed its its repayment, without grounding. He also expressed an
apprehension that the LIBOR rate will increase parallel with the
positive tendencies on the world market and as a result the credit
will become a big burden for the future government.
Former NA Speaker, independent deputy Tigran Torosian also
voted against ratification. The ARFD faction did not take part in
voting. Faction head Vahan Hovhannisian stated that their decision
is political.
Noyan Tapan
June 3, 2009
YEREVAN, JUNE 3, NOYAN TAPAN. On June 2, the RA National Assembly
ratified the agreement signed between the RA and RF governments on
2009 May 20 in Moscow on provision of state credit to RA. According
to it, a credit of 500m USD will be provided to Armenia.
According to the main reporter, RA Minister of Finance Tigran Davtian,
the credit can be assessed as "soft," beneficial for Armenia. It is
provided by 15 years' term, without the repayment obligation in the
first four years.
The Armenian side will repay the debt in 2013-2024 with equal six
months' shares and for using the credit will pay to the Russian
side for 6-month deposits LIBOR rate plus 3 percent annual interest
rate. According to the Minister, at the moment LIBOR rate is 1.22,
that is, the interest rate to be paid is 4.22.
One part of the credit will be spent on financing the budget deficit
and the other part will be used for anti-crisis measures: crediting
of small and medium-sized, as well as system-creating enterprises,
implementation of restoration work in the earthquake zone, formation
of a Stabilization Fund at the Central Bank of Armenia.
The Zharangutiun faction voted against agreement's
ratification. Faction head Armen Martirosian said that it is
inadmissible to take such a credit without government's exact actions
aimed its its repayment, without grounding. He also expressed an
apprehension that the LIBOR rate will increase parallel with the
positive tendencies on the world market and as a result the credit
will become a big burden for the future government.
Former NA Speaker, independent deputy Tigran Torosian also
voted against ratification. The ARFD faction did not take part in
voting. Faction head Vahan Hovhannisian stated that their decision
is political.