Industry financing schemes specified for first time

A Cabinet sitting was held today, chaired by Prime Minister Tigran Sargsyan.

Taking as a basis the Law of the Republic of Armenia “On the State Budget of the Republic of Armenia in 2013” and with a view to facilitating the implementation of those measures outlined in the strategy of export-oriented industrial policy, the government approved a program of activities for 2013 and an action plan for its implementation.

The main purpose of the activities outlined in the strategy of export-oriented industrial policy of the Republic of Armenia is the formation of new economic growth engines in the long run.

AMD545m was earmarked for the program of State support in 2013, of which nearly AMD328m will be used to attract well-known international organizations engaged in industry, subsidize business loans, as well as to promote Armenian products on target markets, co-finance international certification and participation in international trade fairs and other purposes.

Over 30 million drams will be allocated to expand the Gyumri branch of he fund through the launch of an innovation system, with more than 105 million drams allocated for program management industrial promotion and coordination.

The Government expects that the program will help organize activities of the fund of industrial development in 2013, hold 3 presentations abroad to provide multinational companies free zone opportunities, invite representatives from 20 multinational corporations to visit Armenia and so on.

With its next decision, the government authorized the Ministry of Economy to form a working group with the objective of drafting the founding documents of Export Financing Insurance Organization CJSC (EFIO), carry out the necessary processes for company registration and licensing in line with the government’s export-oriented strategy industrial policy. The EFIO’s main function will be to help exporters use the tool of export credit insurance.

The newly formed organization will insure the exporter or its bank from the risk of non-payment by the buyer (borrower). It will generate new funds for banks to offer lower interest rates and expand export finance coverage.

The Minister of Economy was directed to inform the public about the details of the decision with the help of mass media. Prime Minister Tigran Sargsyan added; “It is the first time the Republic of Armenia has been allowing for State budget funds to stimulate industry. I would like to take this opportunity to reiterate the statement made during a meeting with the businessmen: The Government of the Republic of Armenia is ready to objectively support those enterprises capable of significantly increasing physical and export capacity. Any such companies as will apply to the Ministry of Economy will get State support mediating the tools described by Mr. Davtyan. Moreover, we can also provide additional assistance beyond the scope of these 545 million drams should we be confident that applicants might increase the volume of exports. Therefore, eligible entities may apply to the Ministry of the Economy.”

The meeting decided that the next elections to the Yerevan Council of Elders should be held on May 5, 2013.

At the end of the meeting, Prime Minister Tigran Sargsyan reminded that according to the legislation of the Republic of Armenia, the Monday of February 18, 2013 - the day of presidential elections in Armenia – will be a day off in Armenia.