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BOUND BY BONDS?: CONCERN VOICED OVER ISSUANCE OF "KARDASHIAN BONDS"
Economy | 02.10.13 | 16:25
By Gohar Abrahamyan
ArmeniaNow reporter
Oppositional faction member MP Hrant Bagratyan believes it is
unacceptable that the government has sold Eurobonds without informing
and discussing it with the chief legislative body, while the chief
executive claims Armenia's first step into the international money
market has proved to be a success.
Armenian National Congress faction MP Bagratyan made a statement
during the Thursday parliament session and asked everyone's attention
to the fact that the government had earlier sold $700 million's worth
of Eurobonds.
"It is unacceptable and I blame the entire government under the RA
President's leadership, as well as the majority of this parliament.
How can a country's debt increase by $700 million, turning from 44
to 53 percent, the total reaching 8.5 billion dollars, which is 90
percent of the GDP, without the knowledge of the National Assembly?"
said Bagratyan.
The finance ministry press release reports that on September 19 Armenia
placed its first, $700 million Eurobonds in the international capital
market with six percent interest rate and seven years' term.
Among the CIS countries Russia, Kazakhstan, Belarus and the Ukraine
have done so, too.
Back in May Prime Minister Tigran Sargsyan stated that if the issuance
was a success; a new page would open in Armenia's economic policy not
only in terms of administering the state funds, but also in enabling
the private sector to attract cheaper means from the international
money market. And besides, he said, it would let Armenia redeem its
$500-million debt to Russia.
On Friday, finance minister Davit Sargsyan reported that the demand
for Armenia's first-time issued Eurobonds had crossed $3 billion.
"International experts have given highly positive assessments of the
first sovereign Eurobonds' allocation results, and say Armenia's entry
into the international capital market has proved to be successful,"
he said, adding that this issuance "diversifies the country's sources
of finance and create a landmark to later be used by the issuers from
the republic's private sector".
Debt market experts have suggested that the Armenian dollar bonds in
the international stock exchange be circulated under American-Armenian
society lioness and TV star Kim Kardashian's name.
New head of the IMF's office in Yerevan Teresa Daban Sanchez told
RFE/RL's Armenian service (Azatutyun.am) director Hrayr Tamrazyan in
an exclusive interview, that this is a "welcomed development".
"This is a very welcome development. This is a serious success
for Armenia," she said, adding that strong demand for the 7-year
dollar-denominated bonds testifies to investors' confidence in
Armenia's government and financial system: "But it also carries a lot
of responsibility and that is why we are here to help the authorities."
Meanwhile, 'Politeconomica' (Political Economics) Research Institute
director Andranik Tevanyan told ArmeniaNow that the government is
leading an economic policy that reminds of a drug-addict's ratings
and is doing nothing other than taking loans.
"The government needs a dose over and over again to be able to follow
the course it has in its mind, and whether we call it Eurobond or
Russian debt, that's just a formality, debt is a debt," says the
economist, adding that there are not trust concerns about the bond
issuance, as the debt comes with a rather high interest rate.
http://armenianow.com/economy/48892/kardashian_bonds_armenia_eurobonds
Economy | 02.10.13 | 16:25
By Gohar Abrahamyan
ArmeniaNow reporter
Oppositional faction member MP Hrant Bagratyan believes it is
unacceptable that the government has sold Eurobonds without informing
and discussing it with the chief legislative body, while the chief
executive claims Armenia's first step into the international money
market has proved to be a success.
Armenian National Congress faction MP Bagratyan made a statement
during the Thursday parliament session and asked everyone's attention
to the fact that the government had earlier sold $700 million's worth
of Eurobonds.
"It is unacceptable and I blame the entire government under the RA
President's leadership, as well as the majority of this parliament.
How can a country's debt increase by $700 million, turning from 44
to 53 percent, the total reaching 8.5 billion dollars, which is 90
percent of the GDP, without the knowledge of the National Assembly?"
said Bagratyan.
The finance ministry press release reports that on September 19 Armenia
placed its first, $700 million Eurobonds in the international capital
market with six percent interest rate and seven years' term.
Among the CIS countries Russia, Kazakhstan, Belarus and the Ukraine
have done so, too.
Back in May Prime Minister Tigran Sargsyan stated that if the issuance
was a success; a new page would open in Armenia's economic policy not
only in terms of administering the state funds, but also in enabling
the private sector to attract cheaper means from the international
money market. And besides, he said, it would let Armenia redeem its
$500-million debt to Russia.
On Friday, finance minister Davit Sargsyan reported that the demand
for Armenia's first-time issued Eurobonds had crossed $3 billion.
"International experts have given highly positive assessments of the
first sovereign Eurobonds' allocation results, and say Armenia's entry
into the international capital market has proved to be successful,"
he said, adding that this issuance "diversifies the country's sources
of finance and create a landmark to later be used by the issuers from
the republic's private sector".
Debt market experts have suggested that the Armenian dollar bonds in
the international stock exchange be circulated under American-Armenian
society lioness and TV star Kim Kardashian's name.
New head of the IMF's office in Yerevan Teresa Daban Sanchez told
RFE/RL's Armenian service (Azatutyun.am) director Hrayr Tamrazyan in
an exclusive interview, that this is a "welcomed development".
"This is a very welcome development. This is a serious success
for Armenia," she said, adding that strong demand for the 7-year
dollar-denominated bonds testifies to investors' confidence in
Armenia's government and financial system: "But it also carries a lot
of responsibility and that is why we are here to help the authorities."
Meanwhile, 'Politeconomica' (Political Economics) Research Institute
director Andranik Tevanyan told ArmeniaNow that the government is
leading an economic policy that reminds of a drug-addict's ratings
and is doing nothing other than taking loans.
"The government needs a dose over and over again to be able to follow
the course it has in its mind, and whether we call it Eurobond or
Russian debt, that's just a formality, debt is a debt," says the
economist, adding that there are not trust concerns about the bond
issuance, as the debt comes with a rather high interest rate.
http://armenianow.com/economy/48892/kardashian_bonds_armenia_eurobonds