By Atom Markarian
Armenia is among 19 impoverished countries of the world that could soon have part of their external debt written off by Britain, it emerged on Sunday.
Reuters news agency quoted British finance minister Gordon Brown as saying that his government has set aside $50 million this year to provide immediate debt relief to the economically struggling nations. About 80 percent of their debt is owed to organizations like the World Bank and the International Monetary Fund, of which the United Kingdom is a major contributor. Armenia is the only ex-Soviet state included in the scheme designed for mostly African states.
Brown wants the richest donor countries to take over a proportionate share of the debt and has taken the lead on this by agreeing to underwrite 10 percent of the total. He has already signed relevant agreements with the governments of Mozambique and Tanzania during a recent visit to Africa.
Brown’s pledge came after the Group of Seven rich nations agreed in principle at the weekend to provide up to 100 percent debt relief owed by impoverished countries to the international institutions.
Armenia’s external debt currently stands at $1.15 billion or less than half of the GDP, putting it well below the internationally accepted threshold for heavily indebted nations. Both the IMF and the World Bank have until now expressed confidence in the Armenian government’s ability to service the debt.
The government plans to secure at least $93 million in fresh low-interest loans and spend $62 million on debt servicing this year.