UNRECOGNIZED STATUS OF NKR PREVENTS IT FROM COOPERATING WITH
INTERNATIONAL FINANCIAL INSTITUTIONS: NKR PM

STEPANAKERT, NOVEMBER 19. ARMINFO. The unrecognized status of NKR
prevents the republic from cooperating with international financial
organizations, foreign banks and developed countries, NKR PM Anushavan
Danielyan said during his Thursday meeting with representatives of
youth organizations of Sweden, Italy, Bulgaria, Hungary, Serbia,
Ukraine, Moldova, Latvia, Georgia and Armenia.

Half of Karabakh has been destroyed by war. Restoration was a hard
process but “we have nevertheless managed to create a liberal economy
with reforms covering all the spheres of social and economic life.”

Danielyan regrets that no youths from Azerbaijan were present
there. “We should settle our problems at all levels including through
people’s diplomacy and youth’s involvement.”

Since 2000 NKR Government has been implementing economic reforms to
create free market relations on the basis of property equality and
liberal economy. “As a result we are observing significant economic
growth.”

In 1999 the Government began implementing a new tax policy. Income tax
was reduced from 25% to 15%, in 2000 to 10%, 2001 to 5%. Now profit
tax is 5% against former 25%. In 2003 industrial growth in NKR was
over 40%. 2/3 of industry was due to foreign investing. SOme $50 mln
has been invested in the NKR economy in the last years mostly by the
US, Russia, Lebanon, Belgium, Switzerland, Iran, France,
Australia. “No foreign company has failed in Karabakh to date,” says
Danielyan.

In 2002 GDP was 10 bln AMD, in 2003 12 bln AMD, this year it is
estimated at 17 bln AMD. In 2000 exports was $2 mln AMD, in 2001 $5.4
mln, in 2002 $14 mln, in 2003 $18 mln. Profitable are industry,
energy, construction, tourism.

In 2004 big families will receive over 185 mln AMD from banks, in 2008
over 300 mln AMD. 100 mln AMD will be allocated for restoration of
historical-architectural monuments in 2005.

Danielyan says that the US is the only country aiding Karabakh on
state level. The bulk of US humanitarian aid goes to restoration of
settlements and social facilities destroyed during the Karabakh war.