Armenia First Development Policy Operation

closed

The principal purpose of the First Development Policy Operation (DPO-1) Program (2009-2011) is to provide support to the Government of the Republic of Armenia to address vulnerabilities, particularly in the context of the global economic crisis, while strengthening competitiveness for more rapid growth in the post-crisis period. The bedrock of crisis management must continue to be a macroeconomic framework that supports fiscal and external balance, including appropriate exchange rate management, while preserving debt sustainability over the medium term. In improving competitiveness, the DPO program will assist the Government to alleviate private sector and governance constraints. Thus, the DPO series proposes to focus on high impact reforms aimed at public sector modernization and private sector development. Priority reforms need to span both the public and private sectors and focus on the following to unlock growth potential, alleviate the human capital constraint, and reduce corruption: strengthening the business environment through lower business registration and inspection costs; improving corporate governance; modernizing the regulatory framework in telecommunications, mining, and energy; reducing compliance costs through tax and customs reform; and improving efficiency and accountability in public financial management through system reform and strengthening incentives in the civil service.