TIGRAN SARGSYAN: STATE HAS NO RIGHT TO MAKE INVESTMENTS IN RISKY SECTORS

Noyan Tapan

Feb 2, 2009

YEREVAN, FEBRUARY 2, NOYAN TAPAN. A consultation on problems and
development prospects of Armenia’s construction sector was conducted
by the prime minister Tigran Sargsyan on January 31. The heads of
interested ministries and departments, experts of construction sector
and heads of organizations in the private sector participated in
the event.

The prime minister said that in recent years construction was one
of the driving forces of Armenia’s economic development, and its
volumes and growth rates greatly contributed to the development of
other branches of the economy. However, in recent period a decline
was recorded in the sector, which, according to T. Sargsyan,
was conditioned by a reduction in invetsments as a result of the
global economic crisis. Under current conditions the prime minister
underlined the importance of the role of the state and its policy aimed
at promoting economic growth and creating new jobs. He stated that the
construction sector is now in the center of the government’s attention
and it is necessary to use the sector’s capacities to the full.

"Our strategy in this situation is quite a simple and comprehensible
one: the state should increase its expenditures for job creation. These
expenditures that we are increasing should be justified because
the state has no right to make investments in risky sectors. As the
international experience shows, the expenditures on infrastructures are
the most efficient and justified ones. These are road construction,
irrigation system, drinking water, the formation and construction of
infrastructures in agricultural sector," the prime minister noted.

As NT was informed by the RA Government Information and PR Department,
T. Sargsyan announced that the government plans to do construction
work of 250 million USD in the earthquake zone. In his words, these
are large volumes an it is envisaged using construction capacities
for the restoration of the eartquake zone. At the same time, in the
prime minister’s opinion, this is not enough and more attention should
be paid to the opportunities of private investments.

Presenting their opinions and proposals, the representatives of the
private sector attached special importance to the problems that exist
at the design, examination and licensing stages of construction,
the decline in the number of qualified experts, the purchase of new
construction equipment and re-equipment of the old one, the problems
with receiving credits, the necessity to improve the legislation in
order to solve a number of problems, etc.

Summarizing the results of the discussion, T. Sargsyan in particular
said that the presented situation shows that there are no construction
development programs which would contain answers for solution of
all the indicated problems, the expert capacities of the sector are
insufficient.

and there is a problem related to implementation of training programs
which can be solved through programs on technical assistance by the
respective international organizations. Noting that they are prepared
to provide these resources, the prime minister instructed the minister
of urban development and the minister of economy to submit brief
reports on the technical assistance necessary for developing the given
sector which will also form a basis for conducting negotiations with
the interested international organizations on this issue.

By another instruction, the above mentioned ministers in cooperation
with the experts who participated in the discussion and the
representatives of the construction organizations must develop and
present a program on development of construction sector.