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The goals of the tax-budgetary policy for 2023 were the increase of the economic growth potential, the ensuring the debt stability, the strengthening of the security system and the comprehensive meeting of the needs of our compatriots forcibly displaced from Nagorno Karabakh. In 2023, we completely complied with tax-budgetary rules. The capital expenditures exceeded by about 284 billion AMD the deficit of the state budget. We have improved the tax revenues: The taxes and duties have been 23.4% of the gross domestic product (GDP), improving by 0.7% point against the previous year. The RA Minister of Finance Vahe Hovhannisyan said this at May 29 joint sitting of the NA Standing Committees, presenting for debate the main macro-economic indicators, the formation of the budgetary revenues, the expenditures and the deficit of the annual report on the Execution of the RA State Budget for 2023.

In 2023, the Executive continued to carry out the rise of the economic potential, the main problems emerging in separate spheres and tax-budgetary support programmes addressed to the social needs of the Nagorno Karabakh people. The tendency of the continuous rise of the capital expenditures was preserved. Capital expenditures/the GDP indicator has reached 5% in the GDP, allowing to perfectly finance the infrastructure programmes of security and vital significance.

According to the rapporteur, during the year in the conditions of the forecast high economic growth, the planned neutral tax-budgetary policy of restraining the complete demand was implemented.

“Despite the created challenges, the high economic growth for 2023 and the efforts of the tax-budgetary policy have allowed to provide decrease of the state budget deficit compared with the GDP. The deficit of the state budget against the GDP has been 2%, decreasing by 0.1% point compared with the previous year,” the Minister underscored and added that the RA Government debt/the GDP indicator has been 48.1% increasing by 1.4% point compared with the previous year.

As Vahe Hovhannisyan informed, in 2023 the decline of money transfers of non-commercial character was recorded. It was noted that the transfers decreased by 44.3%, which is conditioned by 12.5% decrease from the USA, 26.6% - from other countries and 53% - from the RF.

“As a consequence of the decrease of the role of the favourable external foreign conditions formed for the RA economy, in 2023 the economic growth rate has slowed down compared with 2022, but as a result of capital expenditures from the state budget and continuing high growth of housing, as well as the economic influences of abrupt growth of jewelry at the end of the year, has continued remaining high, registering 8.7% real growth,” the Minister mentioned.

According to the rapporteur, in 2023 the inflation considerably slowed down as a consequence of the deflationary effects transferred from the international markets from the beginning of the year.

The Governor of the Central Bank (CB) Martin Galstyan presented the CB conclusion on the execution of the budget., particularly referring to the macro-environment of Armenia. It was noted that by the increase of the geopolitical tensions and the accompany of the considerable uncertainties in 2023, in the main partner countries of the world and Armenia, despite the risk management of slowing down of the economic growth, in general, high economic activeness from the expected one was recorded. Positive developments were also recorded in the economy of Armenia, though because of gradual decrease of external high demand, the economic growth rates clearly slowed down, however continued remaining high. The tendencies of workforce to Armenia, the financial and capital inflow, the considerable growth of tourism, as well as the increase in export demand from the Republic of Armenia promoted the maintenance of the economic growth high rates. As a result of the abovementioned, in 2023, the economic growth exceeded the targeted indicator designed by the budget, making 8.7%.

“Regarding the inflation, in 2023, in the RA the inflationary environment essentially was eased, and the monetary policy implemented by the CB, the inflationary influences being transferred from the external sector and money evaluation mainly promoted it. As a result, beginning from April, the 12-month inflation was maintained at the considerably low level from the target,” the rapporteur said. Relating to the tax-budgetary policy, Martin Galstyan particularly mentioned that in 2023, it was of anti-cyclic, restraining character.

Afterwards, Martin Galstyan referred to the administrative and capital expenditure of the CB. In 2023, the estimate of the administrative expenditures of the CB was 10bln AMD, for which the execution was 8.6bln AMD or about 86%. In 2023, the expenditures of the Staff maintenance were 99% of the administrative expenditure execution. The CB Governor also touched upon other indicators, the outflow of the CB more experienced employees, which is conditioned by non-competitive salaries in the system. It was mentioned that the execution of the capital expenditures in the financing year was 1bln AMD.

“According to the quarter audits, the Audit Chamber accumulated sufficient proofs of audit and presents the following opinion: In all essential aspects, the audit of the budget execution for 2023 correctly presents the regulated activity of formation of the budget inputs and the implementation outputs, and in that respect, the Audit Chamber expressed positive conclusion on the budget execution for 2023,” the Chairman of the Audit Chamber Atom Janjughazyan underscored, presenting the conclusion of the Audit Chamber.

The AC carried out 40 audits on the reporting year in 10 state bodies. The coverage was 1 trillion 237 billion AMD or 83.9% of the expenditure part. Financial and compliance audits were carried out.

Regarding the statistics of inconsistencies, distortions and the proposals formed on its basis, Atom Janjughazyan informed that in 10 institutions the number of the recorded inconsistencies and the preserved at the end of the year was 34. In this context he specified that during the quarter audits there were recorded inconsistencies, which the state bodies rectified. In 5 state bodies there were 14 distortions in the amount of 5.5bln AMD or 0.26% of the audited sum of money. According to the AC Chairman, that indicator has not affected on the auditory opinion in the conclusion on the basis of the audit results.