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Monday, June 14, 2021

Armenia’s public debt approaches 80%, making default possible

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A very dangerous tendency is forming in Armenia today, according to Armenian economic expert Artashes Ter-Hovhannisyan who was answering the question of how appropriate it is to be proud of the buildup of external debt.

“In fact, it all starts with a state philosophy. Pashinyan and his team have it built on lies. 44 days of war and two years before that, we were constantly lied to. Now he continues his philosophy and assures that everything is fine in our economy. And this is despite the fact that the size of the external debt is approaching the $8 billion mark,” the expert said.

“I am not saying that all this was accumulated during the Pashinyan government. No, about $6 billion of it was formed before that – within 30 years. The remaining $2 billion were accumulated during his premiership,” Ter-Hovhannisyan continued.

“What we got is that with the volume of Armenia’s GDP at about $13 billion, the level of external public debt will soon approach the 80% mark. Nobody thinks why international investors are so willing to lend us money? The thing is that they are strategists. And instead of rejoicing and being proud of the so-called successful placement of Eurobonds, we should now give a distress signal and shout ‘SOS’. Because these investors are well aware that with such a state administration, Armenia will not be able to increase its GDP in the long run, taking into account the negative impacts of the pandemic, and the post-war situation in the country, plus global crisis trends.

“And the day will come when Armenia, which produces virtually nothing, and is actively increasing its national debt, will enter such a period when it will have to declare a default,” the economist warned.

(c) 2021. APN

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