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ORDER OF THE GOVERNMENT OF THE REPUBLIC OF ARMENIA

of March 26, 2020 No. 356

About approval of the second action for neutralization of economic effects of coronavirus

Accepted on March 26, 2020

Assuming as a basis part 4 of article 146 of the Constitution of the Republic of Armenia, the Government of the Republic of Armenia decides:

1. Approve the second action for neutralization of economic effects of coronavirus according to Appendix.

2. To Atom to Dzhandzhugazyan and the chairman of the Central bank Artur Dzhavadyan till March 31 of this year to provide to the Minister of Finance of the Republic of Armenia the procedure for use of the instrument of joint financing of the help specified in Item 11 of this Resolution.

Prime Minister of the Republic of Armenia

N. Pashinyan

Appendix

to the Order of the Government of the Republic of Armenia of March 26, 2020 No. 356

Second action for neutralization of economic effects of coronavirus

1. Purpose of action and help

1. The purpose of action is the help to the certain business entities performing activities in the field of agricultural industry of RA (further – business entities) for risks mitigation, connected with the current feasibility at the last predicted as a result of spread of coronavirus.

2. The purpose of the help is creation for business entities of possibility of temporary availability of financial resources to reaction to changeable conditions of demand, opposition to external challenges and, respectively, implementation of actions for continuation of activities and reorganization and adaptation to the changed economic situation and refining of development strategies.

2. Circle of business entities and form of the help

3. In sense of this action business entity the physical person or legal entity, the individual entrepreneur performing activities in the field of agricultural industry in the territory of RA which has good credit and tax (for legal entities) history is considered, that is the size of the overdue tax liabilities for the complete accounting periods entering in the last 365 days did not exceed 1 percent of the obligations paid for the last 365 days, but no more than 50 thousand dram.

4. The help is provided to business entities in the form of joint financing and (or) the subsidizings of interest rate of credit/leasing for purpose-oriented loans received from banks or credit institutions operating in the territory of RA (further – financial institution). The purpose of the provided forms of the help is the decision:

1) Joint financing: tasks on partial neutralization of insufficient level of measure of providing, currency risk at business entity as regards the credit, and also to partial expense reduction as regards percent;

2) subsidizing: task of essential decrease in interest expenses at business entity as regards the credit.

5. Restrictions of simultaneous application of programs of government assistance in the field of agricultural industry are regulated according to Item 14 of the Program of the subsidizing of loan interest rates provided to the sphere of agricultural industry approved by the Order of the Government of the Republic of Armenia of March 7, 2019 No. 184-L.

6. Conditions of application of the help are provided in tables No. No. 1, of 2, 3 and 4.

7. Subsidizing of the credit (leasing) on the interest rates specified in tables No. No. 1, of 2, 3 and 4, will be performed only for the loan (leasing) granted from coming into force of this Resolution till December 31, 2020.

3. The purpose of the credit (leasing) obtained on instruments of the help, and the requirement to it

8. Forms of the help are applicable for the loan (leasing) which is granted to business entities for implementation of expenses for the purposes established in tables No. No. 1, of 2, 3 and 4.

9. The loan (leasing) granted using instruments of the help shall conform to the requirements established in tables No. No. 1, of 2, 3 and 4.

10. The loan (leasing) will be granted by commercial banks and credit institutions, being participants of programs of government assistance in the field of agricultural industry.

11. The procedure for use of the instrument of the joint financing of the help specified in item 4 of this Appendix will be established by the order of the Government RA. Procedures of use of the instrument of subsidizing of the help shall correspond to the procedures of programs of the state assistance approved separate to the orders of the Government of the Republic of Armenia.

4. Description of content of instruments of the help

12. For the purpose of receipt of the credit (leasing) within this action each business entity corresponding to conditions, the provided actions can submit the application to financial institution in case of which satisfaction at the request of the borrower according to the conditions established by tables 1, of 2, 3 and 4, it will be performed:

1) joint financing of the credit in the amount of the main amount, for loan term, on interest rate of 0% of part of the credit, with partial capture on risk in return of the main credit amount, and (or)

2) subsidizing of credit/leasing in the amount of percent on this credit (leasing) without capture on risk of repayment of the loan.

Table 1

Main terms for crediting legal (except for agricultural cooperatives) and physical persons

 

Credit purpose

Main conditions

Interest rate *

1

The loan granted for the purpose of development of opportunities of persons occupied in the field of agricultural industry, implementation of modern technologies and increase in efficiency of activities

* credit amount – 3-15 million dram,

* loan repayment period – up to 5 years,

* the preferential term of the main credit amount – up to 12 months

0%

2

The loan granted for implementation of modern irrigational systems

* remaining balance of the amount of the credits – to 150 million dram,

* loan repayment period – up to 3 years,

* the preferential term of the main amount – annually up to 6 months

0%

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