the National Assembly approved the 2003 State
Budget on December 26 2002, it allocated spending
334 billion drams (about $570 million). Of that
amount, about 30 percent is expected to come in
form of credits and transfers from other countries.
Borrowed money will be spent on prioritized projects
such as transportation,
housing, energy and water resources, agriculture
"Starting from the mid-90s, Armenia started
paying off its external debt," says David
Hambardzumyan, head of the Budget Management Department,
Ministryof Finance and Economy.
The major lender is the World Bank who gives
loans at 0.75% annual interest rate for the payment
period of 20 to 25 years.
As of today Armenia has $781 Million in external
debt, that had been taken to finance the budget
gap. This year 6 billion drams ($10 million) is
budgeted for foreign loan interest payments.
National defense and security gets the major
share (19 percent) of the budget, at 65 billion
drams ($111 million).
Social programs, such as education, healthcare
and social security will receive (combined) 26
percent. Some 35 billion drams ($58 million) will
be spent on education and science. Social Security
will receive 31 billion drams ($52 million) and
a little more than 21 billion ($36 million) will
be spent on healthcare.
to Hambardzumyan, this year Armenia will spend
more money on
healthcare and education, compared to previous
Particularly, in 2003 the health budget is increased
by 4.8 billion drams ($8.2 million) to be directed
toward improving the quality of medical services.
About 34 billion drams ($58 million) will be
spent on housing and utilities; transport and
communication will receive 37 billion drams ($63
The National Government will also delegate 9
billion drams ($15 million) to local government
budgets, in forms of intergovernmental transfers.
One hundred fifty million drams ($256, 000) is
allocated to government officials' travel costs.
The government also budgeted 4 billion ($6.8 million)
for unexpected emergency costs.
With all the planned expenditures the government
will have to cope with a budget deficit of 47
billion drams ($80 million).
This year the national budget revenues had been
significantly increased because it officially
included the donations granted by the Lincy Foundation
($87 Million) for transportation , culture and
Citizens wishing to see detailed plans for their
tax drams can buy a copy of the National Budget
for 10,000 drams (about $18).