By Shakeh Avoyan
Government statistics claim a mysterious decrease in fuel imports to Armenia in recent years, contrasting with robust economic growth that has brought more cars to the streets of Yerevan and elsewhere in the country.
According to figures released by the State Customs Committee, the total amount of imported gasoline fell by 3.5 percent to 169,000 metric tons last year that saw a record-high growth rate of 12.9 percent. Officials say the fuel supplies this year are unlikely to surpass the 2001 level of 175,000 tons, despite an even faster growth anticipated by the government.
The government has not yet provided a reasonable explanation for the phenomenon that stumps local economists and Western donors. Some officials have pointed to the fact that a growing number of Armenian motorists are converting their car engines to use cheaper liquefied gas. Still, petrol continues to be used by the vast majority of vehicles that have visibly proliferated in the last few years -- an indication of higher living standards.
Armenia has reportedly imported 8,000 cars in the first nine months of 2003, or about as many as during the whole of 2002 and a lot more than in the late 1990s. Some retailers in Yerevan say they now sell from 30 to 50 percent more gasoline than they did in 2000.
Import duties on petrol, which have stood at an equivalent of $223 per metric ton since 1999, are a major source of revenue for the Armenian customs and the government as a whole. The paradoxical fall in such revenues has deepened the widespread suspicion about massive tax evasion in what is one of the most lucrative but murky forms of economic activity in Armenia.
Only a handful of trading companies are engaged in wholesale fuel sales which are widely believed to require strong government connections. Most of them buy the fuel from Mika Limited, an offshore-registered firm whose Russian-Armenian owner has close ties with powerful Defense Minister Serzh Sarkisian. Government figures show, though, that Mika’s share in the wholesale market has fallen from 73 percent to 63 percent over the past year.
The Armenian State Committee on Economic Competition has recently investigated the sector but found no evidence of illegal or dishonest practices such as price-fixing. “We did not identify any instances of non-competitive collusion,” a committee official, Mikael Mikaelian, told RFE/RL.
The retail price of petrol currently hovers between 280 and 300 drams ($0.54) per liter.