By Emil DanielyanPrime Minister Tigran Sarkisian urged Armenia’s leading importers of goods on Saturday to help his government cope with the effects of the global economic crisis by switching to manufacturing operations and creating jobs.
Sarkisian made the extraordinary appeal at a meeting with a group of wealthy entrepreneurs involved in import and shipping operations. His office did not name any of the participants of the meeting held behind the closed doors.
A government statement cited him as promising “maximum support” and “exceptional opportunities” for those of them who will open manufacturing firms. He said those firms can be as profitable as their current businesses.
Large-scale imports of basic foodstuffs, fuel and other commodities is one of the most lucrative forms of economic activity in Armenia. They have effectively been monopolized by a handful of wealthy entrepreneurs close to President Serzh Sarkisian and his predecessor Robert Kocharian. Both men have long faced opposition allegations that they personally benefit from the existence of the monopolies.
The allegations, denied by them, have gained fresh currency in recent months amid the Armenian authorities’ apparent efforts to shore up the national currency, the dram, with substantial hard currency injections in the domestic financial market. Unlike many other currencies, the dram has not weakened against the U.S. dollar since the onset of the global downturn. The importers are seen as key beneficiaries of the exchange rate stability.
According to the government statement, Prime Minister Sarkisian said that the importers have operated in a “quite favorable environment” until now but that the global recession “makes it imperative for the importers to change their behavior.” Whether he hinted at government measures that will make commodity imports less lucrative was not clear. The Armenian premier said last month that large companies owned by government-connected tycoons will be “the number one target” of his government’s fight against tax evasion in 2009.
The statement said some of the importers presented investment proposals at the meeting. But it gave no details, saying only that Sarkisian encouraged participants to come up with more business plans. He also said that job creation in the manufacturing sector is “one of the important anti-crisis measures” planned by the government.
Armenia’s trade deficit reached a new high of $3.3 billion last year on the back of a 35 percent surge in imports. Armenian exports, by contrast, shrunk by 7.2 percent to $1.1 billion, their sharpest decline in over a decade.