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Armenian Opposition Criticizes Government Over ‘Unrevolutionary’ Budget


The Armenian parliament in session (file photo)

Opposition lawmakers criticized the government for submitting an “unrevolutionary” draft budget bill for next year as the debate over the country’s main financial document proceeded in the Armenian parliament on Friday.

The opposition claimed the document lacks ambitious programs and drastic reforms and is largely based on inertia from previous years.

The draft budget bill calls for a sizable increase in public spending which would total 1.88 trillion drams ($3.9 billion). The government’s tax revenues are projected to rise just as strongly. These targets are based on the assumption that the Armenian economy will grow by 4.9 percent in 2020.

When presenting the draft state budget for 2020 in parliament last month Prime Minister Nikol Pashinian said that the government opted for a “conservative” growth projection in order to maintain continued “macroeconomic stability” in the country. Actual economic growth next year may well beat this forecast, he told members of the parliament’s economic committees.

“I believe that the economic revolution in the Republic of Armenia is gaining momentum,” Pashinian stressed then.

The prime minister continued to speak optimistically about economic development in Armenia as he addressed parliamentarians on Friday.

In his remarks Pashinian said that budget revenues in 2020 will increase by nearly 30 percent as compared to the “pre-revolutionary” 2018 state budget. Pashinian stressed that thus his government has fulfilled his promise made before he became prime minister that “within a couple of years Armenia can increase its budget by 30-35 percent.”

Pashinian reminded the parliament about the budget surplus at the end of 2018 and also suggested that in real terms the budget increase next year would have been even higher - more than 35 percent - had the government not made changes in the tax laws.

“This is a direct answer to the question as to whether this budget is revolutionary or not,” he said. “This budget is revolutionary because it precisely fulfills my pre-revolution rather than pre-election promise.”

Opposition Bright Armenia faction member Mane Tandilian still drew comparisons with Georgia, claiming that “post-revolutionary” Armenia develops at a much slower pace than its neighbor once did.

“Georgia showed an economic growth of 11.1 percent in 2003 when a revolution took place in that country. In the subsequent years up until the crisis year of 2008 Georgia’s economy expanded at an average of 9.7 percent a year. How revolutionary is this budget bill? I’d rather call it conservative and even that would be its mildest description,” the opposition lawmaker said.

Tandilian also noted a slow rate of investment growth in the country despite “government assurances that there are no obstacles to investors.”

“During these past two years the growth of investments has not exceeded 6.7 percent. If we look at the example of the revolutionary Georgia, the volume of investments there increased 2.5 times, reaching $1 billion. I leave it to you to make your judgment,” she said.

Arman Babajanian, who is not affiliated with any parliamentary faction, stressed that during the 2018 “velvet revolution” Armenian citizens gave the mandate to the current governing force to carry out “drastic, systemic reforms in the country.”

“But next year’s state budget bill is devoid of such content,” he claimed. “It largely preserves the spirit of inertia. Financing on different articles and in different directions simply pursues the goal of ensuring the continuation of the previous inertia. The budget bill lacks ambitious programs and drastic systemic reforms, it generally lacks creativity and innovation.”

Hayk Gevorkian, of the pro-government My Step faction, countered: “In the period of 2013-2017 we had an increase in the nominal GDP in dollar terms of only $400 million. From $11.1 billion it increased to $11.5 billion. If we divide it up between five years we’ll get an average annual GDP growth of only 0.7 percent. During the two years after the revolution – in 2019 and 2020 – we will have a GDP of about $14.7 billion. In other words, the growth will amount to about 20 percent.”

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