In the same way, there is the issue of agriculture. In the summer, there has always been a big surge in Armenia’s export opportunities, mainly to the Russian market. Now this will become problematic, as the vast majority of agricultural cargoes cross two (Armenian-Georgian and Georgian-Russian) borders in order to reach the Russian market.
And although the “green corridor” is open for cargo in the context of a pandemic, we must understand that the time for inspection, disinfection, and the change of cargo carriers leads to damage to goods, because these are perishable products. Therefore, in the summer season and in this segment, in comparison with the last year, a certain minus is planned – even if there will be a high yield in Armenia itself.
And the last element relates specifically to your question – these are transfers. Traditionally, transfers by individuals, that is, guest workers or representatives of the Armenian diaspora abroad, to Armenia were very high. That is, with a budget of $ 2.3 billion – $ 2.4 billion, and now $ 2.7 billion – $ 2.8 billion and even $ 3 billion, which Armenia is suitable for – the volume of transfers in the best years varied within $ 1.9 billion – $ 2 billion dollars. This is practically comparable with the entire state budget of Armenia and this is a very large amount. The lion’s share in it belonged to a business in Russia, the USA and European countries.
Now we see how the coronavirus stopped life in these countries, respectively, if there is no longer any profit for migrant workers, they will send less money home. Therefore, this year a decline is also predicted for these indicators.
As you can see, this year, for all four main sectors of the economy that brought currency to Armenia, “living” money was important both for macroeconomic stability in general and for individual citizens in particular – minus indicators are expected, which clearly demonstrates vulnerability Armenian economy before the pandemic.
This situation clearly illustrates what Azerbaijan has been talking about for 25 years – that it is impossible to develop the country without access to the sea, with two of the four borders closed, and now everything is closed (except for cargo).
- Do the Armenian government have any programs for overcoming the crisis under these conditions?
- It should be objectively noted that not a single country in the world was ready for the current situation. But each state has a certain potential, which is now starting to work.
In Armenia, this potential is very low. Undoubtedly – and we already see this in principle – Armenian government officials will increasingly talk about international assistance. They have already applied to the European Union, the European Bank for Reconstruction and Development, the Asian Development Bank, and the IMF … But one must take into account the fact that Armenia has a high level of public debt – according to the latest data, it amounts to about 40-45% of GDP.
Accordingly, the burden on public debt is increasing. But in Armenia, they never went in cycles at a level with respect to GDP, because tactical tasks were always solved there but by no means strategic ones.
On the other hand, they will seek help, first of all, from the Eurasian Economic Commission. And in principle, we see that Nikol Pashinyan has already discussed the price of Russian gas with the President of Belarus. So, undoubtedly, there will be appeals for help – loans, etc.
This is true, last year the Armenian economy reached a good one – at a rate of 7-9% – plus. But all these achievements are nothing before a month of downtime of the entire infrastructure of Armenia. We must take into account the fact that one of the two main foci of infection was the workshop in Yerevan, where one person infected 50-60 employees. So real production also stopped there.
Therefore, we can confidently say that by the autumn a completely different picture will be observed in this country.
As for the programs, yes, for today they have allocated some kind of support package in the amount of 440 million drams – approximately about 10 million dollars. This is a very small number.
About the same amount – about $ 10 million is planned to be sent to a referendum on the resignation of members of the Constitutional Court, which they appointed on April 5, and then postponed to a later date. By and large, there is no referendum behind which is only Pashinyan’s desire to “crush the Constitution” for himself.
With the pluses in the economy, the Armenian population could somehow understand this. But now, with every dollar counting, the holding of this referendum will seriously affect the image of the Armenian prime minister.
And even if the pandemic declines in the summer, anyway, by the fall, its residual impact on the Armenian economy will be very large – negatively.
- In this case, the Armenian economy could be in a complete decline?
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It’s clear. For example, transfers – yes, last year they were at a high level, but, on the other hand, the outflow of capital was very high.
And all because the policy pursued by Pashinyan in relation to the so-called oligarchs leads to the fact that the Armenian elite takes out all the extra money from the country, and accordingly from the economy. And there are already no large financial resources that the Armenian government could count on.
The emotional component of the prime minister is also curious, how he acts in this crisis period – Pashinyan actually took upon himself informing the public about the number of infected people, thus putting his personal rating at stake.
I would also pay attention to what restrictions have been adopted in Armenia in a state of emergency. We see how the Armenian parliament adopts bills not only on restricting the movement of citizens but on controlling them through telephones, wiretapping, etc. All this causes concern of large international human rights organizations.
What this situation is talking about – Pashinyan understands that in the near future, by the fall, the situation for him may become unpredictable. Because the economic measures taken cannot objectively give Armenia anything – as I already noted, there is no sphere in its economy that could bring the country forward.
A decrease in transfers, the closure of a large number of industries, structures, lack of state support due to the lack of free finances – all this can lead to the fact that by the fall an army of unemployed people will appear in Armenia who will demand bread, and the government will not be able to offer him this bread.
- It turns out, trying to maintain power, Pashinyan establishes total control in the country?
- Well, as we see, the first steps are already there – that bill provides for full maximum control over the movements of people. That is, they are already at the legislative level adopting acts that in the future will allow them to fully control Armenian citizens.
- And all his talk about democracy was an empty phrase …
- Yes, as it turns out.
