David Stepanyan, Yerevan. Exclusively for Vestnik KavkazaThe opening of Yerevan Mall in February would look quite ordinary, if it wasn't for two substantial circumstances.First of all, Yerevan Mall is owned by Gagik Khachatryan, head of the Armenian State Revenue Committee and one of the largest import monopolists. Secondly, it is this mall where the French network Carrefour wants to locate their representation in Armenia.Carrefour representatives have already declared their intention to place their first 6.600-sq.m. supermarket in Yerevan, on the ground floor of Yerevan Mall. However, the official owner of the commercial center, Mr Norayr Khachatryan, decided to lease this territory to some other tenants than Carrefour. After that, some representatives of the State Revenue Committee started inviting owners of boutiques and shops to rent at Yerevan Mall. It should also be mentioned that when this article was being prepared, a correspondent of Vestnik Kavkaza applied for rent in the mall, and received a refusal "due to the lack of free territory". The PR Department of the State Income Committee stated that "the information on Yerevan Mall being owned by Mr Khachatryan, as well as attempts to fill it artificially is not true".There can be no other conclusion - Mr Khachatryan is trying not to let Carrefour to the Armenian market. And he is supported by Republican Deputy Samvel Alexanyan, the largest import monopolist and owner of Alex Grig, the largest supermarket network. The latter had already rented an enormous area in another big Yerevan mall, Dalma City Mall, for his Gurman supermarket, to prevent Carrefour from using it.To understand the reasons for such efforts of the two oligarchs, you must understand what Carrefour is, a company that in September 2012 opened in the neighboring Georgia.Carrefour SA, world's second largest retailer after the American Wal-Mart, owns over 15,000 hypermarkets, supermarkets, discounters, corner shops around the world. The supposed investments only in the first supermarket in Yerevan would amount to $6-8 million.According to the latest report of The World Bank, Armenian economy remains one of the most monopolized in the region. And the high concentration of property in the possession of 20 families is still the main barrier for competition and economic growth. It is obvious that after world's second largest company comes to the Armenian market, Mr Alexanyan will lose control over the prices for most of the imported goods (first of all, flour and sugar). And taking into consideration the fact that Carrefour imports on its own, its coming to Armenia will inevitably impact the wallets not only of Mr Alexanyan, but also of other privileged importers. Due to the convergence of business and government, only a very lazy person, or, of course, a person who has not been granted such a privilege, couldn't import essential commodities at favorable conditions, distributing them at too high monopoly prices.For the government, the essence of the issue is not limited to defending Mr Alexanyan's interests, the problem is much deeper, for the advent of Carrefour, who is used to playing by their own rules, will mark the decline of the Armenian oligarch clan economy. After the import is divided not between several oligarchs, but between the oligarchs and Carrefour, the extortionate prices for goods in Armenian shops will have to be revised, which will make them lose the superprofits. This, in turn, will deprive the authorities of the main financing source at elections of all levels.A new mechanism of printed units circulation that wouldn't be controlled by the authorities at the next election will inevitably bring about political competition, which is absent in today's Armenia. Taking into consideration that all the major monopolists are Republicans, the correlation between the Demonopolization of economy and politics is obvious. And for the authorities, that is apparently no good news, making them prevent Carrefour from getting to the Armenian (so far, monopolized) market by any means.
David Stepanyan, Yerevan. Exclusively for Vestnik Kavkaza
The opening of Yerevan Mall in February would look quite ordinary, if it wasn't for two substantial circumstances.
First of all, Yerevan Mall is owned by Gagik Khachatryan, head of the Armenian State Revenue Committee and one of the largest import monopolists. Secondly, it is this mall where the French network Carrefour wants to locate their representation in Armenia.
Carrefour representatives have already declared their intention to place their first 6.600-sq.m. supermarket in Yerevan, on the ground floor of Yerevan Mall. However, the official owner of the commercial center, Mr Norayr Khachatryan, decided to lease this territory to some other tenants than Carrefour. After that, some representatives of the State Revenue Committee started inviting owners of boutiques and shops to rent at Yerevan Mall. It should also be mentioned that when this article was being prepared, a correspondent of Vestnik Kavkaza applied for rent in the mall, and received a refusal "due to the lack of free territory". The PR Department of the State Revenue Committee stated that "the information on Yerevan Mall being owned by Mr Khachatryan, as well as attempts to fill it artificially is not true".
There can be no other conclusion - Mr Khachatryan is trying not to let Carrefour to the Armenian market. And he is supported by Republican Deputy Samvel Alexanyan, the largest import monopolist and owner of Alex Grig, the largest supermarket network. The latter had already rented an enormous area in another big Yerevan mall, Dalma City Mall, for his Gurman supermarket, to prevent Carrefour from using it.
To understand the reasons for such efforts of the two oligarchs, you must understand what Carrefour is, a company that in September 2012 opened in the neighboring Georgia. Carrefour SA, world's second largest retailer after the American Wal-Mart, owns over 15,000 hypermarkets, supermarkets, discounters, corner shops around the world. The supposed investments only in the first supermarket in Yerevan would amount to $6-8 million.
According to the latest report of The World Bank, Armenian economy remains one of the most monopolized in the region. And the high concentration of property in the possession of 20 families is still the main barrier for competition and economic growth. It is obvious that after world's second largest company comes to the Armenian market, Mr Alexanyan will lose control over the prices for most of the imported goods (first of all, flour and sugar). And taking into consideration the fact that Carrefour imports on its own, its coming to Armenia will inevitably impact the wallets not only of Mr Alexanyan, but also of other privileged importers. Due to the convergence of business and government, only a very lazy person, or, of course, a person who has not been granted such a privilege, couldn't import essential commodities at favorable conditions, distributing them at too high monopoly prices.
For the government, the essence of the issue is not limited to defending Mr Alexanyan's interests, the problem is much deeper, for the advent of Carrefour, who is used to playing by their own rules, will mark the decline of the Armenian oligarch clan economy. After the import is divided not between several oligarchs, but between the oligarchs and Carrefour, the extortionate prices for goods in Armenian shops will have to be revised, which will make them lose the superprofits. This, in turn, will deprive the authorities of the main financing source at elections of all levels.
A new mechanism of printed units circulation that wouldn't be controlled by the authorities at the next election will inevitably bring about political competition, which is absent in today's Armenia. Taking into consideration that all the major monopolists are Republicans, the correlation between the demonopolization of economy and politics is obvious. And for the authorities, that is apparently no good news, making them prevent Carrefour from getting to the Armenian (so far, monopolized) market by any means.
