The International Monetary Fund (IMF) reached a staff-level agreement with Armenian authorities on the fifth review of Armenia’s economic reform program supported under the three-year Stand-By Arrangement (SBA), according to a statement issued by mission head Iva Petrova. The agreement remains subject to the IMF Executive Board’s approval, expected in June 2025.

If approved, Armenia would gain access to approximately US$25 million, bringing total disbursements under the SBA to nearly US$150 million since its inception.

The IMF noted Armenia’s robust economic activity in 2024, with real GDP growth reaching 5.9%, primarily driven by strong consumption and investment. While growth is expected to ease to 4.5% in 2025 due to global uncertainties and tapering external drivers, it remains solid. Inflation, which reached 3.3% in March 2025, is in line with Central Bank of Armenia (CBA) targets, and the fiscal deficit was contained at 3.7% of GDP, with public debt at a manageable 48.3% of GDP.

However, the current account deficit widened to 3.9% of GDP as inflows from trade, remittances, and tourism declined. The IMF pointed to risks including slowing partner country growth, global trade tensions, and regional geopolitical developments that could trigger capital outflows and currency volatility.

The IMF emphasized several priorities for Armenia:

• Fiscal Discipline: Despite a planned 5.5% budget deficit for 2025 to address refugee integration and infrastructure needs, Armenia must manage spending and raise revenues to ensure long-term fiscal sustainability.
• Public Finance Reforms: Continued improvements in tax policy, fiscal risk oversight, and investment planning are needed to bolster transparency and governance.
• Monetary Policy: The current policy stance is considered appropriate, with inflation expectations anchored. The IMF supports the CBA’s readiness to adjust rates as needed and maintain a flexible exchange rate regime.
• Structural Reforms: The IMF welcomed efforts to boost labor force participation, diversify exports, and improve access to finance. It urged swift implementation of these reforms to ensure inclusive, sustainable growth.

The IMF praised Armenian authorities for their cooperation and reaffirmed the importance of sustained commitment to reform. With the Executive Board’s review scheduled for June, the agreement reflects continued confidence in Armenia’s macroeconomic management and reform agenda.