YEREVAN (Reuter) — Armenia’s National Assembly adopted a $325 million 1997 federal budget Tuesday–and the document envisions heavy defense spending.
Out of total expenditures of 151.9 billion drams–30.5 billion are to be spent on defense needs for Armenia which still faces the unresolved Nagorno-Karabakh conflict.
Social spending is planned at 16.8 billion drams–above the level Levon Ter-Petrosyans cabinet had wanted.
A deficit of 33.9 billion drams is to covered almost entirely by lending from the International Monetary Fund and other foreign lending and aid institutions.
The budget projects inflation in the former Soviet republic at an annual 10.5 percent.
"The parliament met the government halfway and adopted a budget of survival which is aimed more at needs than at development," Ter-Petrosyan told the body after it passed the document.
He emphasized the need to resolve nine-year-old Karabakh conflict as a pre-condition for an enhanced economic future.
Members of the National Democratic Union and the National Self-Determination Union caucuses did not take part in the voting.