FORMER PRIME MINISTERS ON THE ECONOMIC CRISIS

LRAGIR.AM
12:47:35 – 26/05/2009

On May 25, the Armenian former Premiers Hrant Bagratyan, Khosrov
Harutunyan and Aram Sargsyan, during the forum organized at the
American University of Armenia, dwelt on the economic crisis, its
impact on Armenia and the ways out of it.

Hrant Bagratyan stated that a slowing of the economic increase is
being registered in Armenia, which in 2009 reached 16, 8 percent,
while in the rest of the world it is 3, 4 percent.

Unlike the Southern countries, there is a multilateral crisis
in Armenia, Russia and Ukraine, which, according to Bagratyan,
does not have anything in common with the world economic crisis. In
these countries, the crisis has to be deeper as they do not have any
possibility to help the jobless people, they do not have any practice
to help the poor. For example, in Armenia the unemployment average
benefit is 15 thousand drams, and the average salary is 100 000 drams
and the average pension is 25 000 drams. Such a country cannot resist
the crisis, because the average pension should be the 40 percent of
the salary, and the unemployment benefit not less than 35 000 drams.

There is the problem of the national dram in Armenia. In Armenia,
there is no money for loans, and in the West there is money but there
is no one who wants loans, stated Bagratyan. In countries such as
Armenia, Russia and Ukraine the democracy is disappearing, in case
of which there cannot be trade relations. The role of the monopolies
is enhancing in such countries, noted the former Prime Minister.

The Armenian economic increase decreased by 9, 7 percent in four
months. The Azerbaijani GDP, unlike the Armenian one, increased. The
reason is that the Armenian GDP has always been exaggerated in the
last 10-15 years. Bagratyan thinks that the GDP should be corrected,
according to which, the Armenian 4 percent increase is equal to 1
percent increase of the U.K.

Hrant Bagratyan presented also the production situation in Armenia,
according to which, the 51 percent of the production belongs to
40 oligarchs who pay 31 percent of taxes, the small and midsize
enterprises produce only 26 percent and pay 3.7 percent of taxes. The
Foreign capital is the 18 percent of our economy and it pays 23
percent of taxes, and state enterprises produce the 4 percent and
pay 9 percent of taxes.

According to Hrant Bagratyan, one of the main problems of Armenia is
the corruption – fusion of property and state, business and state
government, bringing the example the Minister of Health who is the
owner of a hospital.

Hrant Bagratyan presented also the peculiarities of the Armenian
crisis, which is the monopoly of the import, which is a state
policy. And the governmental project to insert a tax representative
within major enterprises does not have anything in common with
the sphere of import. According to Bagratyan, the export is in an
outrageous state, which is the 1/6 of the import.

Hrant Bagratyan proposed an anti-crisis program, according to which,
we do not have to contribute the construction, which is the main
reason for the deepening of the crisis, but we have to depreciate the
national currency, because Armenia does not need a strong currency now.

On of the other former Prime Minister of Armenia, Khosrov Harutunyan
stated that the crisis will be overcome as soon as it is overcome
in the U.S. In the present situation, the problem should be posed
differently, how to soften the impact of the crisis.

He noted that the crisis has a feature. In state of a crisis, the
government – business relations should be enhanced. In this situation,
they had to trust each other, a thing, which did not happen.

Khosrov Harutunyan thinks that Armenia, which is a country with
poor resources, should give freedom, but the government deprives the
enterprisers from freedom. Under such conditions, Harutunyan attaches
great importance to the establishing of an equal competition field.

According to another former Prime Minister of Armenia, Aram Sargsyan,
the first cause of the present situation is the lack of trust
between the government and the Armenian society, which brings about
an economic crisis. The Armenian government does not do anything to
restore the confidence.

Aram Sargsyan thinks that the second reason for this crisis is
psychological and humane. The third reason is the corruption, but
the problem is its measures, noted Sargsyan. There are enterprisers
in Armenia, who are monopolists and break the law sometimes, but
they create job posts. The most dangerous thing, according to Aram
Sargsyan, is the sphere of those who are state officials and they
are engaged in business and get more profit than the enterprisers
do. Aram Sargsyan noted that until these problems are not solved,
Armenia will not get rid of the crisis.