From March 9 to 21, 2023, within the framework of the IMF mission's visit to Armenia, discussions on the first review of the IMF-supported Reserve Program were organized. Taking into account the proper implementation of Armenia's obligations under the Reserve Program, the parties have reached a working level agreement on the first review of the program, and the approval of the review by the IMF Executive Board is planned for June, 2023. As a result of the review, funding in the amount of 24.8 million USD (18.4 million PKR) will become available for Armenia, which, however, is planned to be used only in the event of the emergence of balance of payments problems.
The representatives of the IMF considered impressive the 12.6% economic growth of Armenia in 2022 and the high rate of economic activity in the first months of 2023, as well as the significant reduction of the Government's debt/GDP ratio to 46.7% in the face of a number of challenges and global uncertainties. According to the IMF, the rate of economic growth will somewhat slowdown in the current year, but will remain at a stable level due to the significant volumes of consumption and investments. Inflation is also forecast to moderate by the end of the year due to the delayed effects of monetary policy tightening and dram appreciation, as well as lower prices of imported foodstuff and energy. The representatives of the IMF expect that the steady implementation of the reforms outlined in the ambitious program of the RA government for 2021-2026 may lead to higher economic growth in the medium term.
The IMF welcomed the RA government's efforts to increase the efficiency of public spending, public finance and public investment management, expressing confidence that eliminating inefficient tax spending and improving revenue administration will be essential to create the necessary fiscal space for priority spending. On the other hand, the successful implementation of proactive monetary policy in curbing inflationary pressures was recorded.