Armenia enters 2010 well-prepared

Weekly economic review for Dec. 19-26

Armenia is ready to resist the second wave of crisis, RA Prime Minister Tigran Sargsyan stated, summing up 2009 results. As Tigrah Sargsyan noted: "The depth of the crisis can't be assessed or the time for the second wave forecasted. Still, we have to be ready to face it." According to him, Armenia is prepared for the year 2010. "With a balance of AMD 80 billion, stabilization fund of AMD 54 billion and EU financial assistance of USD 100 million we have enough resource to provide macroeconomic stability and face new challenges," he stressed.

PanARMENIAN.Net - Armenia, being a solvent state, will be able to receive additional assistance of donor organizations, as the country's macroeconomic policy is highly assessed by international structures. The year of 2009 was full of difficulties, but Armenia proved capable to finish it with minimal losses, Tigran Sargsyan said.

"The global crisis could not bypass Armenia. It bared the weaknesses of the republic's economy and taught useful lessons: to be more resolute in carrying out reforms, economic diversification and creating equal conditions for competition," he said, summing up the results of government's activities in 2009. "Although repeatedly criticized, the government's anti-crisis program was recognized as effective by international organizations."

PM Sargsyan also dwelled on omissions, in particular, the slow pace of reforms and delayed establishment of relevant institutions.


Despite the crisis and reduced GDP volumes, South Caucasian Railways (SCR) CJSC managed to meet its targets, the company's General Director Shekvet Shaydulin finds. SCR's long-term mission consists in becoming an all-national transportation company dynamically enhancing its effectiveness and quality of services rendered, he told Thursday a resulting news conference in Yerevan.


2010 will be a year of renaissance for Armenia, President Serzh Sargsyan said.

"The financial crisis was a test for Armenian entrepreneurs. Presently, the macroeconomic situation in the republic tends to stabilize, what allows to forecast restoration of economy, strengthening of defense potential and favorable resolution of social and internal political issues," he said during an annual meeting with Armenian businessman.


Economic recession in Armenia will not exceed 15% in 2009, said Nerses Yeritsyan, RA Minister of Economy. "This index is quite real," he told reporters in Yerevan.

According to National Statistical Service of Armenia, economic recession in Armenia in January-November made 16%, with monthly index at 6.6%.


Gross amount of agricultural production in Armenia decreased by 0.2% in January-November 2009, compared with 2008 results, to comprise AMD 515,2 billion, Armenia's Agriculture Minister Gerasim Alaverdyan said, summarizing 2009 results.

At the news conference, the Minister presented the situation with basic agriculture spheres, noting that crop sector production volumes grew by 0.2% to comprise AMD 333,5 billion. At the same time, livestock sector production volumes decreased by 0,9% to comprise AMD 181,7 billion.

In 2009, special emphasis was put on seed production, stud breeding, creation of tractor stations and establishment of anti-hail stations.

According to Gerasim Alaverdyan, the Ministry fulfilled tasks, stipulated by 2009 state budget. Active works were conducted jointly with international structures to provide technical assistance for the development of agriculture in Armenia. Also, a number of international agreement in agriculture sphere will be implemented in 2010.


3 road construction programs, with a total worth of AMD 39.8 billion were implemented by Armenian Ministry of Transport and Communication in 2009, Minister Gurgen Sargsyan stated.

The programs were as follows: AMD 9,9 were allocated for reconstruction of 120 km. of roads and 6 bridges; USD 5.4 million were provided by WB and Armenian Government for 100 km of local roads construction, USD 16.92 were invested by RA Government and 47,92 by Asian Development Bank for reconstruction of 227 km of roads. Part of construction works stipulated by programs indicated will be completed in 2009; programs will be finalized in 2010.

In this context, Minister Sargyan emphasized the regional importance of North-South highway project implementation for connecting Yerevan with Georgian ports of Poti and Batumi.

Armenia will receive USD 60 million tranche form Asian Bank of Development to implement South North highway feasibility survey in April 2010. Total value of the project will comprise USD 965 million, with USD 500 million to be provided by ABD. "Highway construction will allow for 30% transportation cost cutting," he said.

Armenian Ministry of Transport and Communication reached certain success in the sphere of taxi operations licensing and road traffic order improvement, Transport and Communication Minister Gurgen Sargsyan stated.

"In 2009, around 2 735 operating taxis were licensed, bringing AMD 20 million to Armenia's 2009 state budget, against AMD 12 million in 2008," he told a news conference in Yerevan.

"The process will become more consistent in nature; we envisage making further amendments in the sphere," he concluded.


Considering corrections and adjustments introduced within this year, South Caucasian Railways investments totaled 1.2 billion rubles in 2009, SCR Director General Shevket Shaydullin said.

"According to 2009 financial program, investments' volume was planned at 1 billion 172 million rubles level. Yet, after correction and adjustments introduced, total investments comprised 1 billion 254 million rubles, with 1 billion 26 million rubles allocated to infrastructure and 227 million rubles to rolling stock," he told the news conference in Yerevan.

"By the year 2010, the company will completely meet concessionary agreement -stipulated liabilities," SCR Director General concluded.


The control service of Armenia does not supervise issue of sales slips in entertainment facilities and restaurants, said Hovhannes Hovsepyan, the head of control service at the RA presidential administration.

He informed that the state revenue committee has already addressed the problem.

Mr. Hovsepyan also said that shadow employment makes 29% in Armenia. "There are companies which register elderly or disabled people as owners in order to avoid tax payments," he said.


HSBC Bank Armenia cjsc was declared Bank of the Year in Armenia for 2009, at The Banker's Bank of The Year Awards in London on 4 December 2009.

The criteria for choosing the winners included banks' financial performance, innovation, new initiatives and general strategy over the previous year.

Among the bank's achievements which have been considered by The Banker were the 16.9 per cent rise in assets in 2008 and the bank's focus on providing superlative customer service.

Tim Slater, Chief Executive Officer, HSBC Bank Armenia cjsc, commented: "The bank continued its investments in technology and infrastructure and introduced internet and telephone banking services to Armenia. HSBC Bank Armenia now offers a full direct banking proposition and a choice of branch, ATM, telephone and internet banking for its customers".

The world's local bank continues to work on the concept of 'your branch that never closes' for customers living in Armenia and elsewhere in the world.

Viktoriya Araratyan / PanARMENIAN News
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