Mediamax, Armenia
March 6 2009

OSCE official on ways of fighting economic crisis in Armenia

Yerevan, 6 March: Armenia had an extremely vulnerable economic model
before the crisis, the head of the OSCE office in Armenia, Sergey
Kapinos, said today [on 6 March].

Speaking at the conference "The crisis: Russian and Armenian
versions", Kapinos said that dependence on transfers and imports of
goods hindered the development of the country’s economy.

"Middle class never emerged in Armenia and the polarization of incomes
is growing", Kapinos said, noting the need for comprehensive economic
reforms, investments in science and education, and in structural
changes in Armenia’s economy.

Kapinos noted the importance of small and medium businesses for the
development of Armenia’s economy, proposing that it is granted tax
benefits under the conditions of crisis. The ambassador added that
Armenia had problems of economic competition, urging the authorities
to fight "restrictions in trade".

"Efficiency of measures to support small and medium businesses is
minimum without fighting monopolism," Kapinos said.

He underlined the need for qualitative improvement in Armenia’s
business environment, saying that Armenia was at "impermissibly low
positions" according to some business environment indices.

The head of the OSCE office in Armenia said [Armenia’s] state budget
resources "will obviously not suffice" for the implementation of
measures to fight the crisis. At the same time, he welcomed the
government’s steps to attract foreign resources, reiterating the need
for their "reasonable and efficient use".