Global crisis threatens `to paralyze` Armenian economy
The global financial meltdown may paralyze Armenia`s
economy, a local expert has warned.
Gagik Gabrielian, head of the Armenian European Policy and Legal Advice Center (AEPLAC), said the crisis that has affected economies worldwide may reduce the volume of cash flowing into the South Caucasus republic normally received as money transfers by citizens. The amount of money sent home by Armenians living in the United States, Russia and other countries has already plummeted, which will bring about a decrease in citizens` purchasing power. Moreover, the crisis may cause a fall in the demand for Armenia-made goods in overseas markets. The troubling trend will primarily affect cognac, a highly-valued Armenian commodity on world markets.
Gabrielian went on to say that the decrease in demand may not be confined to food and other basic goods. "Armenian metal foundries and enterprises producing mineral resources will be affected by the crisis, as well."
At the same time, the expert noted that the crisis had a positive side for the population, as prices for gasoline, food items and other goods in the domestic market may go down.
In the meantime, Armenia`s businesses processing copper, zinc and other metals have reached the brink of bankruptcy. Deno Gold Mining Company (DGMC), an industry giant, is about to halt operations. The company has announced it was scaling down production and reducing staff to 725 employees, explaining the decision was caused by the global financial crunch and sliding world prices for copper and zinc.
DGMC is a closed joint-stock company and 100% owned by Vatrin Investments Ltd (Vatrin), a company incorporated and operating under the laws of the British Virgin Islands. Vatrin, in turn, is 80% owned by Dundee Precious Metals Inc. (DPM), a Canadian mining company, since August 2006.
Gagik Gabrielian, head of the Armenian European Policy and Legal Advice Center (AEPLAC), said the crisis that has affected economies worldwide may reduce the volume of cash flowing into the South Caucasus republic normally received as money transfers by citizens. The amount of money sent home by Armenians living in the United States, Russia and other countries has already plummeted, which will bring about a decrease in citizens` purchasing power. Moreover, the crisis may cause a fall in the demand for Armenia-made goods in overseas markets. The troubling trend will primarily affect cognac, a highly-valued Armenian commodity on world markets.
Gabrielian went on to say that the decrease in demand may not be confined to food and other basic goods. "Armenian metal foundries and enterprises producing mineral resources will be affected by the crisis, as well."
At the same time, the expert noted that the crisis had a positive side for the population, as prices for gasoline, food items and other goods in the domestic market may go down.
In the meantime, Armenia`s businesses processing copper, zinc and other metals have reached the brink of bankruptcy. Deno Gold Mining Company (DGMC), an industry giant, is about to halt operations. The company has announced it was scaling down production and reducing staff to 725 employees, explaining the decision was caused by the global financial crunch and sliding world prices for copper and zinc.
DGMC is a closed joint-stock company and 100% owned by Vatrin Investments Ltd (Vatrin), a company incorporated and operating under the laws of the British Virgin Islands. Vatrin, in turn, is 80% owned by Dundee Precious Metals Inc. (DPM), a Canadian mining company, since August 2006.
Here we are to serve you with news right now. It does not cost much, but worth your attention.
Choose to support open, independent, quality journalism and subscribe on a monthly basis.
By subscribing to our online newspaper, you can have full digital access to all news, analysis, and much more.
Subscribe
You can also follow AzerNEWS on Twitter @AzerNewsAz or Facebook @AzerNewsNewspaper
Thank you!