“Unfortunately they don’t answer the questions we ask,” says former prime minister Hrant Bagratyan concerning the comments and justifications of the ArmRusGazArd company for shifting the gas price and the opinion of the Public Committee on Price Regulation (PCPR). The main argument Mr. Bagratyan brings is that the price of gas in Armenian dram the ArmRusGazArd imports has not changed but the company charges twice more money from citizens. “5-6 years ago when we were importing gas at the price of 110$, the exchange rate of dollar was 580. It means that the price of the imported gas was about 59-60,000. Why have they increased the prices for several times during the past several years if the prices have been the same for you? Why are selling twice more expensive to us at a price of 341 dollar if you are buying it for 180 dollars? The problem is the difference of these 161 dollars. They are telling us tales that the general price has grown by 17%, the exchange rate has changed by 23%, thus they need to raise the price by 40%. I am telling it one more time, there is a huge margin between the wholesale and retail sale, and the difference is twice bigger. We wonder whether it was not possible to make savings within this margin not to increase the rates. What are their expenses? We have not received good explanations from them,” said H.Bagratyan.
Mr. Bagratyan does not think that the explanation that the company has made huge expenses to gasify 94% of the territory from the previous 22-24% is justified. He also says that it is stupid to say that the extra income received as a result of currency exchange rate changes in 2003-2008 have entirely spent on investments and gasification. “There were years that they benefited from the currency exchange rate changes, but eventually we paid for it too. Thus, in 2002-2008 we had 18.6 billion profit, and in the same period the company made an investment of $750 million (246 billion dram) on the entire system, the fifth power bloc of Hrazdan and Iran-Armenia pipeline. During the entire period of its existence the company did not pay dividends to the shareholders and paid all this money to make investments. This 18.6 includes the differences of currency exchange rates and everything,” said the executive director of the company Karen Karapetyan recently. “These investments have become scapegoat. The company says they have gasified, the price is growing and the rates should grow as well. They did not have to make such investment. Did you ask us? Did you ask the state, which is a shareholder as well? Has your investment plan been approved? Have you openly published your investment plan? Who can prove this investment of 750 million? They are saying some figures but no one can provide documental proofs. We need not the executive director of ArmRusGazArd company but the government provide documentation and justify the investment of this $750 million. Otherwise we know how such investments are usually made now. They also don’t know that investment expenses are included in the price as discounts. It is foolish. This profit of 18 billion is taken out of the investment. It means that they had extra 18 dram and plus $750 million. I am sure the government is not educated like them either, or they don’t dare to sit and talk to this company. This is the conversation that fails with this company. We will bring the explanations on March 1,” said Hrant Bagratyan and added that as a result of currency exchange rate changes this company has received 200% profitability. “Because of the stupid policy of the CB in 2007-2006 this company had 200% profitability. At the period when the import price did not grow and the retail sale price was almost the same, they had super-profits. I don’t know exactly how much this profit was because in order to make calculations I should see audit results,” said H.Bagratyan.
We asked a question concerning profitability to the ArmRusGazArd company, in answer to which they said that the profitability in 2002-2008 did not exceed 7.5%. Hrant Bagratyan asked another question why this company is selling gas to people for more expensive prices than to companies. Mr. Bagratyan says the explanations that the current costs for gas supply to citizens are higher are not justified. “In the world this price is either equal or the vice versa. The tale they are telling us that in the their case the price is lower is not true because large buyers have effect from the big capacity too,” said the ex-PM. Concerning the government’s decision to provide a credit of 40 million to this company he said, “The managers of the ArmRusGazArd company say there were free resources, they took it from the government and returned with interest rates. Is it logical that the state borrows money from another state to give a borrowing to a company here? Should they also take borrowing from the currency fund and give to Turkish companies and then take this money back with interest rates? If there are free resources, the solution should be the decision to give it to the CB, which should allocate these free resources to commercial banks. And if the ArmRusGazArd company needs money, it can go and take this money from banks, which will support the development of the banking sector as well,” said Hrant Bagratyan.
He does not believe the assurances that the quality of gas has not been worsened in the recent times. “The government should establish a laboratory and every month inform us what is the quality of gas, water and telephone communication. The government has the right to set a quality standard, but it does not do it. We are asking how does the gas go through the customs proceedings, whether the state has installed measuring facilities to control the inflow capacity. Have you monitored the day and night time tariffs? Maybe at night there is extra capacity and they can use this capacity to weaken people’s heavy load. And the most important thing; for example in Russia, Ukraine and Georgia people get the bill for gas in envelopes, where they find information how much they have used and when. As for our country, we are going to the Haypost, which is totally controlled by Robert Kocharyan, and they tell us that this is the money we have to pay but we don’t know what we are paying for exactly. ” The next thing, they can use two keys on gas measuring facilities, and one should be the gas serviceman’s key and the other one the consumer’s key so that one of these two can’t open it without the other one. It concerns the electricity as well. The government fails to solve these small things, which shows that they are afraid of transparency,” said Hrant Bagratyan. He also spoke about the economic growth rates and the social and economic policy reform platform developed by the ANC. He brought simple calculations to prove that there could not have been 1% growth in the service sector and said he was sorry the ministry of economy Nerses Yeritsyan was not there to learn things from him. Concerning Yeritsyan’s announcement that the current economic situation is like the situation in 90s he said that it was a foolish idea. “Firstly, the crisis of 90s was not a world economic crisis. It was a local crisis. We were in a war, and in 1990-1995 we were the 6th country among the CIS countries with economic recession rate. Now we are the 12th country among the 12 ones. If there was an intellectual potential, the ministry of economy would not dare to say that the current economic situation is like the situation in 90s. He can see that in his dreams only. He should be informed, he should read much instead of speaking like a fool,” said H.Bagratyan. Concerning the ANC’s platform, which consists of 100 steps, he explained it in 10 points as the following: equal distribution of the tax sector, decentralization of construction and diversified taxing, sale of natural resources, strengthening of market mechanisms in income reallocation, etc.
