By Emil Danielyan
President Robert Kocharian subjected the Armenian customs to fresh criticism late Wednesday, saying that its leadership’s stated efforts to combat smuggling and corruption withing its ranks have not lived up to his expectations so far.
Kocharian said although the State Customs Committee (SCC) has ensured an increase in import duties envisaged by Armenia’s 2005 budget it has failed to undergo the kind of internal transformation which he demanded earlier this year.
“True, you are fulfilling your obligations to the state budget, but our observations and research show that there are still large quantities of smuggled goods in the market,” Kocharian was quoted by his press service as telling the SCC leadership. “You must explain to me how they make their way into Armenia and take measures against that.”
Kocharian also lambasted persisting corrupt practices within the agency, singling out the “unacceptable” situation at the Armenian customs checkpoint on the Iranian border. He said customs officers there engage in “money extortion” and force businessmen, ordinary travelers and commercial trucks to wait for hours. He said a team of officials from the presidential Oversight Service will visit the Meghri checkpoint soon and “will not leave it until the situation is sorted out.”
Kocharian’s meeting with the SCC chief Armen Avetisian and his immediate subordinates came as a follow-up to a public dressing-down which the Armenian leader gave to the customs chiefs last January. Without naming names, Kocharian accused customs officers at the time of helping large-scale importers of goods avoid taxes in return for kickbacks. He also promised a sweeping overhaul of the agency.
Customs administration is a major source of complaints from Armenian businessmen who say discretionary powers given to the SCC are a breeding ground for corruption. However, they rarely voice their grievances in public for fear of government retribution.
One of Armenia’s leading importers of coffee saw a criminal case brought against its owners by the National Security Service after they accused the customs last year of penalizing them for their refusal to collude with corrupt customs officials. The company called Royal Armenia claimed in June to be driven out of business by the SCC as a result of its allegations. The SCC denied the charges.
A reputed protégé of the powerful Defense Minister Serzh Sarkisian, Avetisian himself is a frequent target of corruption allegations made by the Armenian opposition and media. He was most recently linked with a luxury hotel that was controversially built in one of Yerevan’s largest public parks.
Kocharian demanded on Wednesday that the Armenian customs take a “strict approach” to its employees that own or are otherwise linked to businesses. “Robert Kocharian also emphasized that the system employs mutually related officials who are directly dependent on each other, something which is unacceptable,” read a statement by the presidential office.
However, it was not clear if Kocharian advocated any personnel changes in the agency. No senior customs or tax officials are known to have been dismissed this year for corruption or mismanagement.
The SCC and the State Taxation Service (STS) have to collect 307 billion drams ($680 million) in taxes and customs fees this year to ensure a 25 percent rise in public spending. Both agencies say they are on course to meet that target. Kocharian announced that he plans a further “substantial increase” in the Armenian budget next year.
(Presidential press service photo: Avetisian, right, taking notes during Wednesday's meeting.)