Armenia's economic growth in 2024 will continue to feel the positive effects, which have been built in the past years, the governor of the Central Bank Martin Galstyan said today.
"Nevertheless, exports promotion and improvement of the investment environment will be important for ensuring high growth, which will also depend partly on large investment infrastructure projects and compliance with the terms of their implementation," he said, presenting the regulator's conclusion on the draft state budget for 2024.
Galstyan noted that the improved administration is expected in turn to improve by 0.75% the tax-to-GDP ratio. As a result taxes will make 24.4% of the planned GDP.
According to him, achieving such growth will help build financial cushions and will allow allocating more resources for capital expenditures, ensuring long-term, stable economic growth.
Galstyan also noted that in 2024, the share of capital expenditures in GDP is expected to increase significantly to 6.6%, while the share of current expenditures is expected to increase to 22.1% of GDP.
"As a result, a budget deficit-to-GDP ratio is projected to be 3.2%t, higher than last year's figure and the one laid down in the medium-term expenditure program," he said, warning that this could lead to inflationary risks.
The head of the regulator also noted that the draft state budget envisages an increase in the ratio of public debt to GDP to 48.4%, which, however, is below the 50% target, which is considered necessary for a stable state of public debt.
Summarizing, Galstyan noted that although the draft budget for 2024 implies expanding demand, which may contain macroeconomic risks, nevertheless the document emphasizes the government's focus on the growth of investments in the development of economic potential.
The draft state budget for 2024 calls for AMD 2.8 trillion ($7 billion) in revenue and AMD 3.1 trillion ($7 billion 750 million) in spending. The projected deficit is AMD 341.1 billion ($852 million 750 thousand). The GDP growth target remains at 7% (as in 2023).
