By Shakeh AvoyanThe Armenian government made on Friday minor changes in its draft budget for next year which reflect lawmakers’ proposals and a further appreciation of the national currency.
Its projected expenditures were set at 820 billion drams ($2.65 billion) and revenues at 744 billion drams. The targets are slightly lower than those contained in the government’s original spending bill unveiled in early October.
Deputy Finance and Economy Minister Pavel Safarian said they were cut by 700 million drams because of the Armenian currency’s continuing strengthening against the U.S. dollar which is reducing the value of budgetary grants promised to Yerevan by Western donors. “This reduction is mainly due to a change in the Armenian dram’s value against foreign currencies registered since November 1,” he said.
The dram was trading at an average of 305 per dollar in currency exchange shops in Yerevan on Friday, up by nearly 10 percent from the early September level.
According to Safarian, ministers also made over 7 billion drams worth of “redistribution” in the planned 2008 expenditures. He said that mostly resulted from the proposals of some lawmakers, notably those who want greater government spending on education.
The projected expenditures represent a 40 percent surge from this year’s level. The sharp increase is partly due to the fact that the government will for the first time include social security taxes and subsidies to the state pension fund into its budget.
Even so, the government will have to ensure a further major increase in its tax revenues in order to meet the record-high budgetary targets. Prime Minister Serzh Sarkisian told ministers last month that this will require “serious efforts” from tax authorities and other government agencies.
The National Assembly is scheduled to open final debates on the bill on Tuesday.