The government has reaffirmed its pledges to significantly reduce poverty in Armenia in the next five years.
The government’s policy program approved by parliament in June says that sustained and faster economic growth will cut poverty from 29.4 percent in 2016 to 18 percent by 2022. It also says that export promotion and better conditions for doing business will allow the Armenian economy to grow by around 5 percent annually in this five-year period.
Deputy Prime Minister Vache Gabrielian called these targets realistic when he spoke to RFE/RL’s Armenian service (Azatutyun.am) this week. Gabrielian stressed the importance of faster growth anticipated by Prime Minister Karen Karapetian’s cabinet. He said it will benefit rural regions of the country where poverty has traditionally been higher than in Yerevan.
“If you look at our [2018] budget you will see that agriculture is one of the few sectors where there will be an increase in [government] spending,” said Gabrielian. “It means that we are planning measures especially in that sector, which could have the greatest impact on poverty reduction.”
But Vahagn Khachatrian, an economist affiliated with the opposition Armenian National Congress (HHK) dismissed the government plan as “extremely unrealistic.” “These are just pieces of paper which they write up for the sake of writing and which are not put into practice,” he said.
Khachatrian argued that the government’s 2018 budget does not call for any increases in public sector salaries, pensions and poverty benefits which were most recently raised in 2015. That, he said, means that real incomes of hundreds of thousands of Armenians will fall next year because of consumer price inflation.
Under the government program, the minimum national wage, which currently stands at 55,000 drams ($114) per month, will rise by 25 percent by 2022. According to Deputy Minister of Labor and Social Affairs Tadevos Avetisian, the government will start raising it after 2018.
Using a different methodology, the World Bank has recorded lower poverty rates in Armenia. According to it, just under 25 percent of Armenians lived in poverty in 2016. In a report released in May, the bank forecast that the poverty rate will fall to 22.2 percent in 2019.
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