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Government Sees Improving Investment Climate In Armenia


Armenia - Prime Minister Karen Karapetian chairs a cabinet meeting in Yerevan, 3Aug2017.

The World Bank will acknowledge an improvement of Armenia’s business environment in an annual report that will be released later this year, according to government officials in Yerevan.

The Doing Business survey assesses investment climates around the world through a range of specific indicators. Armenia ranked 38th out of 190 nations that were covered by the World Bank’s most recent research released last fall.

The bank found improvements in two of its ten categories used for evaluating the ease of engaging in entrepreneurial activity: “Getting credit” and “Enforcing contracts.” But Armenia continued to score poorly in four other categories: “Paying taxes,” “Resolving insolvency,” “Dealing with construction permits,” and “Getting electricity.”

The government has repeatedly pledged to address lingering problems in these areas as part of its declared efforts to improve the domestic business environment. Prime Minister Karen Karapetian met with two dozen ministers and other senior officials on Thursday to discuss progress in the implementation of relevant measures promised by his cabinet.

A government statement on the meeting cited some of those officials as saying that 20 of 49 policy measures planned for this year have already been taken. Those include stronger government support for small and medium-sized businesses, better investor protection, easier access to credit and more simple procedures for registering property and obtaining construction permits.

This should help Armenia move up to 26th place in the next Doing Business survey that will be released by the end of this year, the officials said, according to the statement.

“We must already start working on the 2018 plan of actions for improving Armenia’s business environment,” Karapetian was quoted as saying.

In its policy program approved by the parliament in June, Karapetian’s government pledged to put Armenia among the top 20 countries in the Doing Business rankings “as a result of reforms of the next four or five years.” It promised to not only streamline business regulations but also reform tax administration and combat widespread corruption.

Opposition lawmakers dismissed the five-year program as a gimmick. They said that the authorities are still not interested in genuine economic and political reforms.

Some analysts are also skeptical about the practical impact of the World Bank rankings. “Armenia’s position in the rankings has always been high, but that has not affected the quality of our economy in any way,” said Hayk Gevorgian, an economics writer for the “Haykakan Zhamanak” daily. He pointed to recent years’ steady decline in foreign direct investment in Armenia.

Gevorgian said that the country is facing more serious economic challenges such as the existence of government-linked business monopolies, corruption and a lack of judicial independence. A World Bank survey released in 2013 said that “oligopolies” control 68 percent of economic activity in Armenia, making it the most monopolized economy in the former Soviet Union.

Vahagn Khachatrian, an economist affiliated with the opposition Armenian National Congress (HAK), claimed that the government is so focused on the Doing Business surveys for propaganda purposes. “This is their latest step to please international structures,” he said.

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