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Karapetian Denies Economic Monopolies In Armenia


Armenia - Prime Minister Karen Karapetian attends his government's question-and-answer session in parliament in Yerevan 6Dec2017.

Prime Minister Karapetian insisted on Wednesday that his government is successfully liberalizing lucrative sectors of the Armenian economy that have long been dominated by a handful of wealthy entrepreneurs.

“We have no classic monopolies as such. What we have is markets with dominant players,” he told an opposition lawmaker during the government’s question-and-answer session in the National Assembly.

Karapetian said that the State Revenue Committee (SRC) can certify that in those markets “the number of players and the volumes” of their business operations have increased in the past year. “Work in that direction is firmly on track,” he said.

“The dominant player in a market has better starting conditions and their, let’s say, 70 percent share in the market cannot shrink to 20 percent within a year. But you will see a positive dynamic there,” added Karapetian.

The lawmaker, Sergey Bagratian of the Tsarukian Bloc, remained unconvinced, speaking of “state structures sponsoring those who have dominant positions.” “We have young people that would wipe out those dominant positions within a year if there was free competition,” he said.

“Do you know of a single case where we barred somebody from entering a market?” countered the premier. “If you do, tell us. Nobody is stopped at the border and told that ‘you can import this but not that.’”

Karapetian pledged to improve the domestic business environment and open up all sectors to greater competition shortly after he was appointed as prime minister in September 2016. Opposition politicians remain skeptical about reforms promised by him.

The lack of competition has been particularly acute in lucrative imports of some essential products to Armenia. Samvel Aleksanian, a government-linked tycoon, has long enjoyed a de facto monopoly on imports of sugar, wheat, other basic foodstuffs as well as some medicines.

Critics have accused Aleksanian of using his government connections to ward off competition and evade taxes. He has always denied that.

The SRC nearly doubled the total amount of taxes collected from Aleksanian’s companies in the first half of this year. The tax agency is now headed by a figure close to Karapetian.

Karapetian on Wednesday also claimed to have markedly improved the macroeconomic situation in Armenia which he said is “manageable” now. He argued that economic growth in the country is on course to exceed this year a 3.2 percent rate that was forecast by his cabinet in late 2016.

Another Tsarukian Bloc deputy, Gevorg Petrosian, recalled a 2013 statement by President Serzh Sarkisian that an Armenian government failing to achieve a growth rate of at least 7 percent must step down. He wondered whether Karapetian’s cabinet will “fulfill” that directive.

Answering the question, Deputy Prime Minister Vache Gabrielian said the current government is guided by its five-year policy program that was approved by the parliament in June. The 120-page document commits the government to ensuring that the Armenian economy expands by around 5 percent annually.

“Thank you for not answering my question,” Petrosian responded to Gabrielian.

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