Wednesday, November 12 2014

The current government of Armenia is the natural continuation of its predecessors, Stepan Demirchyan, MP from the opposition Armenian National Congress Faction, said in Parliament on Wednesday when speaking of the draft budget of 2015.   

He said that in 2015 the budget expenditures will increase by 52 bln AMD, of which 47 bln AMD will be spent on payroll. It is also envisaged to ensure 4.1% economic growth whereas the mid-term program of the Government specifies 5%. The MP recalled that in 2015 the GDP growth was planned at 5.1%, however, it is obvious even today that fulfillment of even 4% will be a success. Demirchyan also recalled that IMF expects the economic growth rates in 2014 to be 2.6%-2.7%. He said that the Russian ruble depreciation will undoubtedly have a negative effect on Armenia's economy. As a result, over the past four months, transfers from Russia dropped by $47 mln. 

Demirchyan thinks that the current problems in the country are the result of the Government's ill- considered policy conducted over the past few years, due to which the wealthy people are getting wealthier and the poor are getting even poorer. He thinks that a big role in this policy belongs to most members of the government, who speak much of the export growth but in fact they serve the interests of a group of large importers. The Government considers that Armenia will benefit from the sanctions against Russia because the export of agricultural products may grow. In the reality, however, over Jan-Sept 2014 the export of Armenian products to the Russian market dropped by 6.5% to $235 mln to $219 mln. Much is also spoken about proportional development of the regions, but in fact the sales at 12455 trade outlets totaled 714 bln AMD, of which 90% registered in Yerevan. 

The budget revenues would be much more if the corruption and shadow economy were really combated.  Due to the corruption, Armenia's economic indices annually drop by 2 pct points. Despite the Government's statements on the fight against large business and support to SMEs, no real fight is observed, because the large business is concentrated in the hands of officials, he said.