ACCORDING TO BAGRAT ASATRIAN, BECAUSE OF LOANS ARMENIA HAS AILING ECONOMY, WHICH IT TRIES TO TREAT WITH NEW LOANS

Noyan Tapan
Aug 19, 2009

YEREVAN, AUGUST 19, NOYAN TAPAN. There has been a 16.3% economic
downturn in Armenia in 2009 due to a decline in construction (53%)
and industry (11.3%), RA Deputy Minister of Finance Vardan Aramian
announced on August 19. In his words, there is the same situation
in the world economy which means that the developments in Armenia’s
economy are in line with the global developments.

He forecast a 12-15% downturn in late 2009.

According to V. Aramian, the government is conducting an expansionary
policy: instead of the private sector which is in poor condition now,
it injects money into the economy, and the sooner the economy absorbs
that money, the sooner a growth will begin.

The member of the RA National Assembly "Prosperous Armenia" faction,
Deputy Chairman of the NA Standing Committee on Economic Issues Vardan
Bostanjian expressed an opinion that one of the causes of the current
hard economic conditions is the incomprehensible forecasts made by
non-experts. "We continue requesting money from outside to inject it
into the economy. We don’t see anything good in this," he noted. At
the same time he stated that there would be a positive result in 2010.

In the opinion of the former Chairman of the Central Bank of Armenia
(CBA) Bagrat Asatrian, 16.3% economic dowturn recorded in Armenia
in 2009 is conditioned by the poor work done in the last quarter of
2008. In his words, the economy contracted by almost 20% at the time
when the authorities forecast an economic growth. B. Asatrian said
there is now a growth in trade and service sectors due to the existence
of a shadow economy. However, this resource will be exhausted soon.

B. Asatrian said that a growth may be recorded in agriculture and
industry in 2010, but these are optimistic forecasts.

In his estimation, Russia’s economy will have a decisive impact on the
Armenian economy. If Russia ensures a growth of at least 3% in 2010,
only in this case our economy will begin to stabilize.

He expressed an opinion that no anti-crisis program exists at the
present time, while the government’s expansionary policy is beyond
understanding.

According to the speaker, the reason for the current situation is
that at one time a double-digit ecomomic growth was recorded on the
basis of private remittances and loans received from international
organizations. "As a result we have an ailing economy. Today we again
take loans from outside to overcome the crisis. It turns out that
we want to treat the illness with the resources that caused it,"
B. Asatrian said.