Republic of Armenia : 2019 Article IV Consultation and Request for a Stand-By Arrangement-Press Release; Staff Report; and Statement by the Executive Director for the Republic of Armenia

Author/Editor:

International Monetary Fund. Middle East and Central Asia Dept.

Publication Date:

June 5, 2019

Electronic Access:

Free Full Text. Use the free Adobe Acrobat Reader to view this PDF file

Summary:

Since the 2014–16 regional economic slowdown, economic activity has recovered, while policies have remained broadly in line with staff’s advice. Supported by the upgraded fiscal rule, fiscal consolidation remains on track, and public debt has started to decline. Inflation is under control, the financial system remains stable, and pressures on the exchange rate have been limited. Nonetheless, important challenges remain. Importantly, the still-weak business climate and corruption constrain the economy’s capacity to grow sufficiently rapidly to tangibly reduce poverty and unemployment. Moreover, the economy continues to be vulnerable to external shocks; public debt, while declining, is relatively elevated; and enhancing revenue mobilization remains a critical priority. Recognizing these challenges, the new government has pledged to revitalize efforts to fight corruption, improve competition, strengthen revenue administration, and build resilience to shocks. It has requested a new Fund-supported program to help achieve these objectives and move Armenia toward a more dynamic market economy.