ADB Approves €89.47 Million Loan to Enhance Armenia’s Fiscal Sustainability

The Asian Development Bank (ADB) approved a €89.47 million policy-based loan to aid in the second phase of Armenia's Fiscal Sustainability and Financial Markets Development Program, Subprogram 2.

This program, launched in collaboration with Agence Française de Développement, aims to enhance Armenia’s fiscal stability and improve its financial markets.

These reforms align with Armenia's national objectives to strengthen governance, foster economic stability, and promote climate initiatives

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Advancing Fiscal Reforms and Governance

Subprogram 2 focuses on essential fiscal reforms to improve Armenia’s budget planning, procurement systems, and public debt management.

Specifically, key objectives include enhancing multi-year budget planning, strengthening procurement governance, and better managing public debt risks.

Consequently, these reforms will enhance fiscal risk management and public investment for sustainable operations.

Beyond fiscal governance, the program also intends to advance Armenia's financial sector by creating more liquid money markets and boosting investor confidence.

The initiative also aims to enhance corporate governance and transparency, thereby supporting the infrastructure of Armenia’s financial markets.

Yevgeniy Zhukov, the ADB Director General for Central and West Asia said, “The reforms will stimulate the financial sector and access to finance, positioning Armenia as a more robust economy resilient to external risks.”

The commitment to climate action remains a significant focus of Subprogram 2.

The loan will help Armenia integrate climate strategies into its financial policies.

This approach is consistent with Armenia's larger environmental objectives, integrating sustainability into its fiscal framework.

João Farinha-Fernandes, ADB Principal Financial Sector Economist said, “This program is a vital step in promoting fiscal effectiveness and bolstering Armenia’s capacity to manage fiscal risks and public investments effectively, creating foundations for sustainable growth.”

Subprogram 2 enhances Armenia’s fiscal resilience and boosts investor confidence, building on Subprogram 1's success.