Armenian economy stuck in problems, while citizens move abroad
By Fuad Aslanov
Last week, about 20 entrepreneurs met with the Prime Minister of Armenia Karen Karapetyan. During the meeting, the businessmen presented their concerns to the head of the Armenian government.
The sides discussed a number of problems in the spheres of tourism, energy, small and medium business, taxes and customs duties. The entrepreneurs, in particular, noted that in case of reduction of the turnover tax, small business in Armenia will die. They also touched upon the difficulties related to traveling to the neighboring Georgia, as well as other pressing issues.
However, despite the existence of all these problems, Armenia’s National Statistical Service claims that the average growth of economic activity in the country allegedly amounted to about 6 percent this year.
If that is true, then why tens of thousands of Armenians leave the country every year and this trend does not stop? The same National Statistical Service says that about 14,000 people emigrated from the country in January to September 2017.
Earlier this year, the former Prime Minister of Armenia, current leader of the Freedom Party Hrant Bagratyan stressed in an interview that the main reason for people’s emigration from Armenia is that there is no demand for workers in the economy of the country. He rightly noted that as soon as the economy starts to gain momentum, there demand arises and migration stops.
However, this is alien to Armenia. The poor economy is the main reason why many people are unemployed there. The unemployment rate in the country is highest among the CIS states, making up 19 percent. Armenians periodically hold protests demanding to open new jobs, while others can find no other way but to leave the country. Armenia’s population has decreased by about 15,200 over the past year, and today it is even less than 3 million, according to the National Statistical Service.
The lack of investment is also among the main reasons for Armenia’s fading economy and, consequently, for the exodus of people. When taking office last year, Prime Minister Karapetyan promised to bring investment in the country, but he couldn’t keep this promise. Few foreign businessmen dare to invest in the corrupt Armenian economy. The 2015 report of the Transparency International Anti-corruption Center showed that Armenia is one of the most corrupt countries in the world.
Investment in Armenia has been very small in recent years and has not created sufficient jobs to slow the emigration, Armenian demographer Artak Markosyan told 1in.am.
“The double-digit economic growth of several years in the 2000s, when emigration fell and there even was a trend of immigration, was caused mainly by the construction boom as well as by the good economic situation in Russia. Our compatriots traveled abroad and returned home with enough money in these years,” he said.
However, today the situation is much worse – Armenians leave abroad, often together with their families, and do not return. This further deteriorates the social and economic situation in Armenia, and the government is still unable to fix the problem.
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Rashid Shirinov is AzerNews’ staff journalist, follow him on Twitter: @RashidShirinov
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