EDUARD AGHAJANOV: IN CONDITIONS OF HALF THE ECONOMY OPERATING IN "SHADOW", GOVERNMENT CAN EASILY INCREASE BUDGETARY REVENUES

Noyan Tapan
Jun 28, 2007

YEREVAN, JUNE 28, NOYAN TAPAN. An increase in the RA budgetary
expenditures envisaged by the new program of the government is quite
realistic, economist Eduard Aghajanov said at the June 28 press
conference. According to him, by official data, 35% of the Armenian
economy operates in "shadow", while in reality over half the economy is
"shadow": under these conditions, in order to collect 9 billion drams
into the state budget, the government only needs to display a political
will and determination in the fight against the shadow economy.

In his words, in Armenia the degree of a businessman’s success depends
on the degree of his being close to power. Most of the businessman’s
profit goes to the pocket of his "roof", and it is the "roof" that
does not allow him to be taxed. The economist noted that he knows a
lot of businessmen who would prefer to operate in the legal field.

E. Aghajanov considered a considerable increase of pensions as a
possible step. There are 530 thousand pensioners and 460 thousand
working people in Armenia. According to the economist, it means that
on one hand, the number of pensioners is exaggerated, on the other
hand, some part of the workers are engaged in the shadow sector and do
not make payments to the pension fund. If the authorities take these
workers out of the shadow sector and register pensioners, a 60-70%
increase of pensions is quite realistic.

Although 2007 is a pre-election year, E. Aghajanov did not rule out
the possibility of a GDP growth. He reminded that under conditions
of presidential and parliamentary elections, a high index of economic
growth (14%) was registered in the country in 2003.