News - Finance ministry official: Armenia government debt increased from 20% to 46% in national currency

In the last four years, the amount of bonds or debt in the structure of the total debt of the Armenian government has increased from 20 percent to 46 percent in the national currency, the dram. Head of the Public Debt Management Department of the Ministry of Finance of Armenia, Samvel Khanvelyan, stated this at the Investment and Financial Forum on Tuesday. According to him, the bonds issued by Armenia have reached large amounts, and this stems from the government's policy, which implies targeting the domestic debt market as the main source of funding the budget deficit. Khanvelyan informed that in 2023, together with the World Bank and the International Monetary Fund, the domestic debt market of Armenia was assessed, and it showed that the most developed sector in Armenia is the legal regulation, but the secondary market is "lame, and there are problems also with the structure of investors and in terms of composition. "If in 2020 eighty percent of the owners of [Armenia’s] state bonds were representatives of the banking system, then according to the data of the end of 2023, that percentage reached 65. The share of owners of other sectors, in particular, of pension funds and insurance companies, has increased. The share of high-class investors in the amount of [Armenia’s] domestic debt is about 7 percent, or 150 billion drams," said the Armenian official. He noted the weakly developed currency market of Armenia. "It leads to the fact that the exchange of several tens of millions of dollars causes a serious resonance, which is a big problem for foreign investors," Khanvelyan added. The Armenian official informed that the updated online system of Armenia’s bond retail trade will start operating this month, and this will enable both residents and non-residents to purchase bonds directly from the Armenian state.