Armenian government bombast inflation through social programs and unchangeable gas prices

PanARMENIAN.Net - “We are satisfied with the outcomes of the presidential meeting a Saint Petersburg, where the tariffs on Russian gas for Armenia were agreed. The prices will remain unchanged during 2011. Moreover, these will be lowered for the poor,” said Armen Arzumanyan, spokesman for the Armenian President.

Besides, the Armenian authorities are set to implement various social programs aimed to alleviate tensions among the populations and to assist local manufacturers. Specifically, the government approved an AMD 538mln project for barley and corn production, cancelled official checkup for farming machines and regulated the law on allowances for temporarily disabled. In addition, 2000 Armenian citizens will be given interest-free loans for customs clearance of cars driven from Georgia.

The Armenian government also approved 14 programs at the total amount of AMD 60bln for assistance to local enterprises, what is believed to boost production and create job opportunities.

However, a large number of experts feel doubts about the measures. They are confident that the collapse of the government system started in 2010, due to inefficient usage of resources and lack of food stock to counterbalance shocks.

It’s not a secret that the Armenian market is monopolized and the Central Bank is incapable to suppress inflation alone. Although Armenians are strong and accustomed to hardships, social tensions threaten to transform into a revolt one day.

Meanwhile, chairman of the Agrarian Peasant Union of Armenia (APUA) Hrachya Berberyan believes that weather conditions in 2011 are favorable for Armenia’s agriculture compared to last year, when 14.5% drop was recorded in the field. Prices for fruits should be lower this year, depending on other factors as well, Berberyan told a PanARMENIAN.Net reporter. Berberyan noted that prices for tomato will be twice cheaper in 2011 in Armenia compared to 2010, as tomato seeds for 500ha were distributed by APUA among farmers. According to him, prices for cucumber will also decrease in 2011, due to the same reason.