US scared off investors from Armenia

In late January, the US Embassy in Armenia has published a report on the investment environment in Armenia in 2017. Yerevan expert Arman Gevorgyan, speaking with Vestnik Kavkaza, commented on the tough assessments for Armenia.

- A recent report by the US Embassy in Armenia describes a disappointing situation for investors. In particular, the country's authorities are accused of helping to monopolize the economy. Is there any serious reason for such an assessment?

- The assessment of the US embassy was entirely correct, there is nothing unexpected or extraordinary in it. The patronage of the authorities in relation to some businessmen was indicated by all independent experts for the last 15 years. Demonopolisation of the Armenian economy or creation of conditions for increasing the level of competition is a political issue. But political issues are managed by the president, who enjoys the support of those circles receiving profits from monopolies. Accordingly, the president in turn supports the policy of monopolization. Here it is necessary to divide responsibilites. All the governments have been not able to solve the issue of demonopolization of the economy since the 2000s, because they did not make political decisions. It is not entirely correct to bring claims on this issue to the current government: it has been operating for less than 1.5 years and cannot solve all the problems that have accumulated since 2000. Political power is in the hands of the president, not the government.

- The embassy report also mentions the existence of oligopolies ...

- The existence of the oligopoly system was recognized by Prime Minister Tigran Sargsyan, who chairs the Eurasian Economic Commission now. But there was nothing he could do, because these issues are decided by the president, not by the prime minister.

- The report says that potential investors cannot pin hopes on Armenian courts as well, because the judicial system is not independent. How realistic are the assessments related to the activities of the courts?

- This is all true. I have not heard about the fairness of the judicial system in the post-Soviet countries, where the judicial system, in fact, fulfills the order of the executive power. On the other hand, a complete objectivity requires us to remember that over the past 20 years, all reforms of the judicial system have been carried out, based on the proposals of Western experts. All the reforms in this sphere were financed from the countries of the European Union. It turns out that the West provided funds, prepared proposals, which were transformed into legislative acts, but things aren't moving. Moreover, the situation is getting worse. Naturally, Western experts point to a lack of political will. However, if this is true, then why should Western structures take part in this? For example, the EU has allocated almost 20 million euros for reforming our judicial system in recent years. But do the European taxpayers know how their money was spent and what is the effect? That is, there is no proper control over the reform process. The Armenian authorities have no political will, but responsibility is borne not only by our government, but also by Western advisory bodies.

- Do you agree with the thesis that corruption remains its main problem?

- Armenia has been officially fighting corruption for almost 20 years, including under the supervision of international, primarily Western structures. First, it is known that Armenia does not fully fulfill its international obligations in this matter. Second, the media is full of corruption reports. But the work of law enforcement agencies in combating corruption is very selective. In fact, law enforcement agencies act on the orders of the executive structures. In this respect, Armenia differs little from other countries of the post-Soviet space. There is no real fight against corruption. This issue is also political.

- You said about a division of responsibilities within the government. Do you agree with the opinion that the situation described in the report hits the authority of Prime Minister Karen Karapetyan?

- The solution of all these problems must be political, but to date the prime minister does not have a political mandate. As for the general state of affairs in the economy, the international credit rating agency Fitch Ratings pointed out objectively obvious positive work of the Karapetyan government. The report of this neutral international agency was published on the results of 11 months of last year. The agency for the first time revised its outlook to positive from stable. This is a real assessment of the Karapetyan government's work, as opposed to the comments made in some media, participating in the domestic political struggle on the side of President Serzh Sargsyan and against the Prime Minister