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ARMENIA EYES INCREASE IN MILITARY AND SOCIAL SPENDING


By Ruzanna Khachatrian
Armenia is set to increase its military spending by almost 39 percent next year, officials said after closed discussions of the 2007 draft budget in parliament on Monday.

Defense Minister Serzh Sarkisian said the allocation of some $285 million to the defense sphere could not be compared to neighboring Azerbaijan’s $1 billion military spending, but “is enough if managed well and expended purposefully.”

In an RFE/RL interview First Deputy Minister of Economy and Finance Pavel Safarian called next year’s budget socially oriented despite the drastic increase in military spending. “It is not the year-to-year spending increase in a separate sphere that characterizes the nature of the budget, but the share this sphere has in the overall budget,” the deputy minister said.

A total of 198 billion drams (around $555 million) in the $1.48 billion budget are envisaged for all social spheres, including education, public health and pensions, against 102 billion drams (around $285 million) to be spent for the Armenian military and law-enforcement agencies.

According to Safarian, a total of some 20 percent increase is planned in social spending, with the largest share of this increase to fall on healthcare.

Last week Freedom House urged the U.S. administration to withhold promised economic assistance to Armenia which it believes has failed to meet “reasonable standards” for democracy and civil liberties.

The New York-based leading human rights organization charged that the Armenian government has been “backsliding on promised reforms”.

The Corporation is set to approve the list of nations eligible for that aid on Wednesday.

Armenia’s Minister of Economy and Finance Vartan Khachatrian, who on behalf of the Armenian government signed a $235.6 million MCA compact with the scheme managing Millennium Challenge Corporation last March, downplays the impact of the Freedom House findings and hopes the Corporation will not suspend the program.

“I think we don’t have problems. Freedom House studies only two indexes in one of the three blocks of questions. The decision to be made will not be based on Freedom House evaluations only, opinions of other NGOs will be compared and a final decision will be made,” the minister told RFE/RL.

The promised U.S. aid would be used for upgrading Armenia’s battered irrigation networks and rural roads. Officials say the vast majority of approximately one million Armenians dependent on farming would directly benefit from that.

Khachatrian says at least $12 million of the expected allocations have been considered in the 2007 budget expenditure pattern.
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