ARMENIAN PRIME MINISTER APPEALS TO BANKERS TO JOINTLY ADDRESS URGENT ISSUES ON THE BASIS OF PRINCIPLES OF PUBLIC PRIVATE PARTNERSHIP
ArmInfo
2007-06-25 20:46:00
Armenian Prime Minister Serzh Sargsyan appealed to the Armenian bankers
to jointly address economic issues of current importance. During the
June 25 annual meeting of the Union of Banks of Armenia, the Prime
Minister noted that the Armenian banking system has passed a hard way
of establishment over the past 15 years, it is rapidly integrating into
the international banking community and applying the best standards
of the international banking practice. "We have passed a long way of
reforms. Structures, which either failed to stand competition or broke
the rules of the market discipline, had to leave the system. Today
the banking system of the country is stable and the confidence in it
is increasing with every passing day," S.Sargsyan said.
A growth of the banking system’s indices outstripping GDP prove this,
and, first and foremost, such factors as introduction of corporate
management system, creation of banking infrastructure, establishment of
such institutes as the Fund for banking deposits guarantee, National
payment system, credit bureau, contributed to this. "However, a lot
has still to be done. The indices of financial mediation are still
low. The banks’ aggregate provision of crediting do not exceed 10%
of GDP, this means that the banks’ participation in development
of the country’s economy is not yet at a satisfactory level. This
is the reality that troubles us most of all. We should make credit
funds available for wide layers of population, so as any citizen can
have an opportunity to improve his or her living conditions by means
of credits. The availability of credits would allow young people to
study at educational institutions," S.Sargsyan said.
The Prime Minister noted that the Armenian government has worked out
a program for economy development for the next 5 years. This program
will be discussed at the National Assembly on June 26. The program
reflects the tasks concerning the banking system as well. "In the
program we suggest implementing the principles of public private
partnership. In this case, it means that the government, the Central
Bank and the Union of Banks will jointly work out and implement
important economic programs. And the state is to create favorable
conditions for the private sector and implement important projects
on the basis of mutual understanding and respect," he pointed out.
S.Sargsyan formulated a number of urgent problems. First of all, we
must make Armenia the financial center of the region. We have real
prerequisites for so doing. The second problem is uneven banking
development of the country. In Armenia banks are concentrated in
Yerevan. As a result, the greater part of our population has no access
to banking services.
"I think it is time for you to consider this problem. Perhaps, the
CB should pick some regional city, for example, Dilijan, and make
it a financial center. This will be a good stimulus for the whole
region." The banking system must become the locomotive of the real
sector development. "You should actively develop new technologies,
introduce a wide range of financial services, particularly, asset
security, leasing and business development support."
S.Sargsyan said that today most of reformers work in the Central
Bank . "Our banking system must become a bright example of efficient
real sector manager applying effective mechanisms of corporate and
business process management, financial administration, etc.. One
more problem is social policy: banks are public institutions and
are responsible for social problems. However, you must not confuse
charity with social programs."
In conclusion, S.Sargsyan said that banker’s word is generally
regarded as a word of honor and expressed hope that the same is true
for Armenian bankers.
"We have a long way to go and the Government is ready for a
constructive dialogue. So, I urge you to thoroughly consider the
above proposals and to draw relevant conclusions," Sargsyan said.