The Philosophy of External Public Debt Management

Abstract

The main goal of the presented article is to propose effective solutions in the philosophical context of the management of the foreign public debt of RA. The Government of the RA should adopt as a priority the philosophy of attracting borrowed funds from the domestic market. Considering also the fact that the Republic of Armenia relied on the philosophy of ensuring double-digit economic growth, having a long-term goal to increase the real GDP indicator, which will ultimately contribute to reducing the volume of debt obligations. As a priority contributing to this goal, the RA Government intends to significantly increase the volume of trade turnover[1], especially in connection with the current geopolitical situation, when Armenia, in particular, is the “gateway of Europe” for Russia, which is the main trading partner. [1] In 2021, major trading partners of the RA included Russia from the CIS countries (31.4% of trade turnover, compared to 30.6% of the previous year), and from the EU and other countries China (15% and 13.5%, respectively), Iran (6.0% and 5.6 %), Switzerland (4.6% and 6.6%), Germany (3.5% and 4.2%), Italy (3.4% and 3.3%), Bulgaria (2.7% and 2.4%) and the Netherlands (2.7% and 1.8%). Source: RA Ministry of Finance www.minfin.am.