ABOUT THE CBA
The Central Bank, within its authorities, represents interests of the Republic of Armenia in international financial organizations, international and overseas banks, as well as in relations with central and other banks of other countries, signs international agreements as required by the Law. (According to the LAW ON THE CENTRAL BANK OF THE REPUBLIC OF ARMENIA, Adopted 30.06.1996)
Relations with the IMF and the WB
International Monetary Fund (IMF)
Armenia has been a member of the International Monetary Fund (IMF) since May 28, 1992. Within the IMF, Armenia is part of a constituency including Belgium, Bosnia and Herzegovina, Bulgaria, Croatia, Cyprus, Georgia, Israel, Luxemburg, Macedonia (former Yugoslav Republic of), Moldova, Montenegro, Netherlands, Romania, Ukraine.
On May 29, 1997, Armenia accepted the obligations under Article VIII of the IMF's Articles of Agreement on current account convertibility, thereby giving confidence to the international community that it will pursue sound economic policies that will obviate the need to use restrictions on the making of payments and transfers for current international transactions, and thereby contribute to a multilateral payments system free of restrictions.
The cooperation with the IMF focuses on working out the Armenian position as regards the most important issues related to Fund membership. The EFF/ECF-supported program aims to achieve strong growth and poverty reduction, fiscal and external sustainability, and financial sector stability. In addition to financial support, the IMF has a wide-ranging program of technical assistance with Armenia, focused in particular on tax policy and revenue administration, management of public finances, macroeconomic modeling and the inflation targeting framework, contingency planning in the banking sector, and statistics. In addition, a full update under the Financial Sector Assessment Program (FSAP) took place in 2012.
In its capacity as a member state, the CBA provides the IMF with information and holds annual consultations with the institution in compliance with the provisions under Article IV of the IMF's Articles of Agreement.
The Minister of Finance is the Governor and the Chairman of the CBA is the Alternate Governor in the Board of Governors of the IMF on behalf of the Republic of Armenia. At present, Armenia’s quota equals SDR 92.0 million, or 0.04 percent of total quota. Armenia’s voting power in the IMF is 1,661 votes, or 0.07 percent of total.
World Bank Group
Armenia joined the International Bank for Reconstruction and Development (IBRD) on September 16, 1992 and the International Development Association (IDA) on August 25, 1993. Within the IBRD, Armenia is part of a constituency including Bosnia and Herzegovina, Bulgaria, Croatia, Cyprus, Georgia, Israel, Macedonia (former Yugoslav Republic of), Moldova, Montenegro, Netherlands, Romania, Ukraine. Within the IDA, Armenia is part of the same group, but which in this case do not include Bulgaria and Romania.
The World Bank (IBRD/IDA) are the largest multilateral donor in Armenia (natural resource management and poverty reduction, foreign investment and export promotion, information technologies, infrastructure, education, health, social sector, agricultural reform, municipal development, transport, and judicial reform).
The IDA lending has helped finance infrastructure rehabilitation, including support for earthquake reconstruction, irrigation, power, road maintenance, and municipal water. The IDA credits supporting the social safety net and improving access to services have included operations in health, education, and a social investment fund aimed at improving basic social and economic infrastructure.
The World Bank’s Country Partnership Strategy (CPS) for 2009-2013 focuses on the near term needs of addressing vulnerability and mitigating the adverse poverty effects of the crisis as well as laying the foundation for promoting medium term competitiveness and growth.
Armenia’s Governor at the IBRD/IDA is the Minister of Economy; his Alternate Governor is the Deputy Minister of Finance. Representatives of the CBA take part in World Bank meetings. At present, Armenia holds 1,139 shares in the IBRD's equity capital or 0.07 percent of total shares. Armenia’s voting power in the IBRD is 1723 votes, or 0.09 percent of total. Armenia’s voting power in the IDA is 54615 votes, or 0.24 percent of total.
Armenia became a member and a shareholder of International Finance Corporation (IFC) on April 18, 1995. IFC's strategy is part of the joint World Bank Group Country Partnership Strategy. IFC’s priorities in Armenia include supporting the development of small and medium enterprises to create employment opportunities, promoting energy efficiency to increase the competitiveness of local companies and mitigate climate change, and improving risk management to reduce the vulnerability to economic downturns.
IFC began providing advisory services in Armenia in 1999 and investing in 2000. IFC has invested in projects across a range of sectors, including financial markets, manufacturing and mining; and advised the government and companies on improving corporate governance, developing leasing and housing finance, and improving business regulation.
Armenia’s Governor at IFC is the Minister of Economy; his Alternate Governor is the Deputy Minister of Finance. Representatives of the CBA take part in IFC meetings. At present, Armenia holds 992 shares in IFC's equity capital or 0.04 percent of total shares. Armenia’s voting power in IFC is 1760 votes, or 0.07 percent of total.
Armenia became a Multilateral Investment Guarantee Agency (MIGA) member on December 5, 1995. Within the MIGA Armenia is part of a constituency including Bosnia and Herzegovina, Bulgaria, Croatia, Cyprus, Georgia, Israel, Macedonia (former Yugoslav Republic of), Moldova, Montenegro, Netherlands, Romania, Ukraine.
The Minister of Economy is the Governor and the Deputy Minister of Finance is the Alternate Governor in the Board of Governors of the MIGA on behalf of the Republic of Armenia. At present, Armenia holds 80 shares in MIGA's equity capital or 0.05 percent of total shares. Armenia’s voting power in MIGA is 312 votes, or 0.14 percent of total.
Armenia became an ICSID member on October 16, 1992. The Government of the Republic of Armenia signed the ICSID Convention on September 16, 1992 and deposited its instrument of ratification on the same date. The Convention entered into force on October 16, 1992 and the Republic of Armenia attained the Status of Contracting State.
Relations with international financial organizations
Cooperation with the European Bank for Reconstruction and Development (EBRD)
Armenia joined the EBRD on December 7, 1992. Since 1992 EBRD’s focus is on helping to diversify the economy by supporting investment in various sectors, as well as supporting the development of the financial sector and small and medium-sized enterprises. The Bank’s priorities in Armenia for the next few years are to continue developing the financial sector and access to finance, upgrading municipal and urban transport infrastructure, developing agribusiness and high value-added, export-oriented industrial companies, improving the regulatory and institutional framework for sustainable energy, and raising corporate governance standards and increasing transparency in the mining sector. The Central Bank of Armenia Armenia’s Governor at the EBRD is the Minister of Economy; his Alternate Governor is the deputy governor of the Ministry of Finance. Representatives of the CBA take part in EBRD meetings and formulate Armenia’s position with regard to the most important issues discussed by the EBRD. At present, Armenia holds 1,050 shares in the ЕBRD's equity capital or 0.05 percent of total shares. Armenia’s voting power in the EBRD is 1050 votes, or 0.05 percent of total.
Interstate Bank founded with accordance to the Agreement of establishing Interstate Bank, signed between CIS countries from January 22, 1993 in Minsk. The founders of the Bank are Kazakhstan, Armenia, Belarus, Kyrgyzstan, Tajikistan,Moldova, Turkmenistan, Uzbekistan, Ukraine and the Russian Federation. Bank is operating on the territory of CIS countries and participating in the process of integrative actions of CIS countries, in development and rework in the field of payment systems. The structure correspondent connection allows customers and users to be provided by schemes of payment with counteragents in different point of CIS and other countries. Interstate Bank is operating in money-market, equity market, interbank credits and deposits. Bank is an international institution, which has direct approach to national payment systems of founders of the institution, which allows making settlements as a participant in payment systems of Kazakhstan, Armenia, Belarus, Kyrgyzstan, Tajikistan, Moldova, Turkmenistan, Uzbekistan, Ukraine and the Russian Federation.
Armenia is also one of the founding member countries of the Black Sea Trade and Development Bank (BST DB), which was established in 1997 by the member countries of the BSEC as a regional multilateral development bank and financial pillar of BSEC. The current owners are the governments of Albania, Armenia, Azerbaijan, Bulgaria, Georgia, Greece, Moldova, Romania, Russia, Turkey, and Ukraine. BSTDB supports regional trade and investment, providing financing for commercial transactions and projects in the private and public sectors to help Member States to establish stronger economic linkages and to contribute effectively to their transition process towards the economic prosperity. Armenia appoints a Governor (Alternate Governor) and a Director (Alternate Director), who represents the country on the Board of Governors and the Board of Directors accordingly. The Chairman of the Central Bank is appointed as the Governor and the First Deputy Chief of Staff of the Office of the President of the Republic of Armenia is appointed as the Director in the Board of Governors and Board of Directors of the BSTDB accordingly. Alternate Governor is the Director of Financial System Stability and Development Department of the Central Bank of Armenia, and the alternate Director is the Director of Multilateral and Bilateral Economic Cooperation Department of the Ministry of Foreign Affairs of Armenia. At present, Armenia holds 1.0 percent of the BSTDB total shares, which is make up 20 million SDR.
Armenia became a member of Asian Development Bank (ADB) in September 2005. Within the ADB Armenia is part of a constituency including Cook Islands, Fiji, Indonesia, Kyrgyz Republic, New Zealand, Samoa, Tonga. Since 2005 the ADB has been a key partner in supporting the development agenda of Armenia, as well as its economic growth and reform program. Operations in the country are closely aligned with the government’s priorities—as well as ADB’s strengths—including promoting rural development, developing the private sector, and supporting enhanced regional cooperation. ADB’s work in Armenia has been focused promoting inclusive economic growth. The Minister of Economy is the Governor and the Deputy Minister of Economy is the Alternate Governor in the Board of Governors of the ADB on behalf of the Republic of Armenia. Representatives of the CBA take part in ADB meetings. At present, Armenia holds 31,671 shares in the ADB's equity capital or 0.3 percent of total shares. Armenia’s voting power in the ADB’s is 71275 votes, or 0.54 percent of total.
The Eurasian Development Bank Armenia became a full-fledged member of EDB in April 2009. It considers transportation infrastructure, electric power industry, agriculture and financial markets development to be priority lines of the Bank’s activities. Improvements in these sectors will promote sustainable economic growth of Armenia’s economy and allow expand trade relations with other Bank’s members.
Relations with international organizations
On March 2, 1992, during its 46-th Session the General Assembly adopted the Resolution 46/227 admitting the Republic of Armenia as a UN member.
Armenia is one of the founding member countries of the Organization of the Black Sea Economic Cooperation (BSEC). The BSEC was established on June 25, 1992, in Istanbul, when the Summit Declaration was signed by the Heads of State and Government of 11 countries – Republic of Albania, Republic of Armenia, Republic of Azerbaijan, Republic of Bulgaria, Georgia, Hellenic Republic, Republic of Moldova, Romania, Russian Federation, Republic of Turkey and Ukraine. Republic of Serbia joined the Organization as a Member State in 2004.
The Republic of Armenia has been a member of World Trade Organization (WTO) since 5 February, 2003.
The International Organization of Securities Commissions (IOSCO), established in 1983, is the acknowledged international body that brings together the world's securities regulators and is recognized as the global standard setter for the securities sector. IOSCO develops, implements, and promotes adherence to internationally recognized standards for securities regulation, and is working intensively with the G20 and the Financial Stability Board (FSB) on the global regulatory reform agenda.
The mission of the Organization for Economic Co-operation and Development (OECD) is to promote policies that will improve the economic and social well-being of people around the world. OECD/International Network on Financial Education (INFE) The OECD established the International Network on Financial Education (INFE) which facilitates information sharing, research and the development of policy instruments and analytical tools. More than 240 institutions from different countries, as well CBA are members of the OECD/INFE. Armenia has become a member of the OECD/INFE since 2009. On the basis of the latest objectives and activities, the INFE created number of Expert Subgroups on different important issues. CBA has become a member of the Expert Subgroup on National Strategies on Financial Education and on Measurement of Financial literacy. This collaboration also helps to better address the issues related to the design and development of national strategies and elaborate the National Strategy on Financial Education (NSFE) of Armenia. Also, in 2011 Financial literacy Pilot Survey was conducted in Armenia, based on the methodology and questionnaire elaborated by the Subgroup.
The OECD/INFE focuses on the following areas
- national strategies for financial education,
- financial education at school,
- empowering women through financial education and awareness,
- measuring financial literacy: methodologies and data collection,
- evaluating financial education programs: methodologies and guides.
This cooperation has allowed the CBA to exchange of information and views on different programs, initiatives, issues, research and finding related to financial education; exchanging, identification and development of good practices and tools; discussion of analytical work developed by members, the OECD and other organizations on financial education, and of international principles and good practices.
The International Organization of Pension Supervisors (IOPS) is an independent international body representing those involved in the supervision of private pension arrangements. IOPS currently has around 70 members and observers representing approximately 60 countries and territories worldwide.
The Central Bank of Armenia joined Alliance for Financial Inclusion on 11 February 2011. Armenia is a co-chair of the Consumer Empowerment and Market Conduct Working Group (CEMC WG), and chairing the Institutional Framework and Supervision Working Subgroup of the CEMC WG. In 2011, the CBA also joined the Maya Declaration, the first global and measurable set of commitments by developing and emerging country governments to unlock the economic and social potential of the ‘unbanked’ people through greater financial inclusion.
The CBA expressed its commitments for the Maya Declaration for: 1) encouraging innovative financial products and services that are responsive to the requirements of the poor in a safe and sound and sustainable manner; 2) continuously improving the regulatory and supervisory framework to protect the consumers ensuring that consumers are always adequately informed, protected and able to enjoy the full benefits of their financial Access; and 3) empowering the consumers with effective redress and complaint handling system and with school and lifelong financial education. Particularly, we expect to adopt Financial Education National Strategy in 2012-2013, and thereafter follow the implementation of the strategy.
AFI is a global network of financial policymakers from developing and emerging countries working together to increase access to appropriate financial services for the poor. AFI is led by its members and partners, central banks and other financial regulatory institutions from developing countries. The network includes members from over 90 countries working together to advance its mission of accelerating the adoption of proven and innovative financial inclusion policy solutions, with the ultimate aim of making financial services more accessible to the world’s 2.5 billion unbanked people.
Relations between Armenia and the European Union, including trade and economic ties, are regulated by the Partnership and Cooperation Agreement (PCA) signed between Armenia and the European Community in April 1996, and which came into effect in July 1999. In 2006 the Armenia-EU Action Plan was signed outlining main directions of Armenia-EU cooperation and EU support. EU technical and financial cooperation supports Armenia’s objective of an increasingly close relationship with the EU and helps the country’s efforts to develop and implement strategic plans.