PARTY OPPONENTS ARGUE ABOUT FATE OF USD RATE IN ARMENIA

Yerevan, June 20. ArmInfo.Devaluation of USD rate in Armenia is more
conditioned by paradoxes, than by economic laws. Tatoul Manaseryan,
member of "Justice" faction, said this at "Hayeli" club today.

He said that in the theory of economics there are 4 basic factors
that may have impact on consolidation of the national currency.

Firstly, this is the growth of economy, but in this case Armenia
should have at least 30% of the economic growth for devaluation.

Secondly, devaluation is caused by the fluctuation of the main
world currencies, which, in the case of Armenia, can’t have such
a big impact, either. The third factor is the state of the payment
balance of the country. Manaseryan said that we have nothing to boast
about, as the export tempo experiences slowdown. He added that the
payment balance of Armenia is negative, and Armenia mostly exports USD
(about $3 billion). The fourth factor is a subjective one. Manaseryan
supposed that there are forces that get inside information and make
super profits, holding monopoly positions in the markets. Besides,
the super profits they get are connected to the shadow economy that
makes about 80%.

At the same time, MP representing the Republican Party of Armenia,
economist Gagik Melikyan said the euro-dollar fluctuation in the
international market is in conformity with the revaluation level
of the Armenian dram. Nevertheless, he believes that one should not
neglect the season factor used by certain financial organization who
speculate on sharp drop of the exchange rate. The last dollar sag
was connected with the "last phone call," Melikyan said. However, T.

Manaseryan disagreed with him. He called paradoxical that prices,
including for imported goods, are growing in the country despite
the strengthening of the Armenian dram. If it is connected with the
rate of US dollar, the rise of prices is tangible enough. He said
all this paradox is connected with the high black economy and its
monopolization.

Nevertheless, G. Melikyan said, one should not neglect either the
high economic growth or the US policy on devaluation of the US dollar
or the large-scale private transfers to Armenia. In such conditions,
the Central Bank can maintain the foreign exchange rate only through
dram interventions into the market, which will lead to inflation. T.

Manaseryan does not see any way out of the situation though
intervention into the market either. The only way out is to peg the
Armenian dram to the "basket of world prices" for key products in order
not to depend on the dollar or euro, he said. This way is successfully
applied in a number of states. He underlined a circumstance that
Armenia still lacks an exact program of economic development, its
structures, priorities. However, his political rival disagreed with
him again.