The Executive Board of the International Monetary Fund (IMF) has today confirmed around USD16.3mln funding to Armenia within Extended Fund Facility (EFF) program.

According to the press release disseminated by the IMF, the completion enables the release of about USD16.3mln, bringing total disbursements under the arrangement to about USD48.9 mln.

It should be recalled that the extended arrangement for about USD114.1mln was approved on March 7, 2014.

“Armenia’s performance under the program has been adversely affected by weaker-than-expected external conditions and deviations from some program policies. The authorities’ policy response has helped mitigate the initial impact of the shocks but the outlook remains challenging. Steadfast implementation of the agreed measures will be necessary to meet the objectives of the Fund-supported program, rebuild buffers and policy space, and unlock Armenia’s growth potential”, said Mitsuhiro Furusawa, Deputy Managing Director and Acting Chair, said.

According to him, it is important to return to greater exchange rate flexibility and to limit interventions in future.

The IMF representative also attached importance to adjustment of monetary policy to maintain price stability. Enhancing communication with the public, business community and other stakeholders on key policy directions will be important for building consensus on policy responses.

As for the banking system, the IMF considers it stable.

“Introducing a financial rehabilitation plan for the electricity sector and pursuing structural reforms to enhance competition, competitiveness and regional and global integration remain critical to reduce vulnerabilities and support broad-based growth”, the IMF notes.