During the past 19 years the state economic policy of Armenia has been built on an erratic basis. Corrupt, shady, monopolistic… this is how the economic state of Armenia can be characterized. And the economic crisis was a very good argument for the Armenian government, by which they are trying to justify their failures.
The former minister of finances and economy of Armenia, economist Edward Sandoyan introduced to us as he calls the reason of our undeveloped economy. He also offered prescriptions to the government, which he believes will fix the situation. According to Mr. Sandoyan, the greatest issue is the shady market. “The cruel methods, which we used in relation to small businesses, is at least animosity to your people. We are not able to tax big businesses because they are particles of the government and are therefore decision-makers. So we get to tax small businesses but they should be extremely privileged and even be exempted from all taxes. In that case we will have great indices.” The economist notes that in fact it is not too difficult to have a normal and evenly developing economy. All we need is a desire. “Everything that is to be done is known. Even if I am not able to struggle against monopolies then it is very easy to calculate the profits of the monopolized business, which depends on the changes of the currency, market monopolies. It depends, which of the sector is under the monopolist’s control. That way it’s pretty easy to normalize. Such super incomes can be taxed by up to 200 percent. We should understand that besides the fact that they are harming the economy (not because they don’t pay taxes) they also weaken the structural grounds of the state. Such a monopolist may destroy a competitor via damping or other methods. Besides that almost 80 percent of the taxes are formed due to indirect taxes. It means the consumer pays the taxes instead of the businessman. Not to mention that they are not paying taxes themselves they don’t send a part of our paid taxes to the budget.” In Sandoyan’s words, “With the help of a magic stick it will be possible to apply the institution of common incomes of the population. We have a very feeble law, which defines that any statesman with more than 3 million incomes should submit a tax form but no one cares about that. It is merely a political tool but if it becomes a real tax collection tool than corruption will not exist any more and there will be a few opportunities for money laundering. For example, casinos, which are facts of moral degradation, are disgusting and should be destroyed. Why are we scared to do so? Because there is no political will. The National Assembly doesn’t agree, which is natural as approximately 90% of the NA are businessmen and they are violating a constitutional norm. Or who doesn’t have a business in the government?” The economist states that no matter of how much the government would speak about that these issues cannot be resolved through cosmetic changes and reforms. “It is evident that the issues of our economy are not possible to be solved by cosmetic means. The crisis has showed that we have systemic issues and undeveloped economy,” said Sandoyan. “These issues cannot be solved by the methods, which are useful for the US or Europe. These countries have developed economies and their prescriptions don’t work for us. You cannot give analgin to some patient, who has a headache because the pain comes from the fact that the patient constantly falls done from the 7th floor. You have to make sure that the patient doesn’t fall down,” said the economist and offered ways to the state to get rid of the current situation. And to the question as to what the state should do to get rid of the created situation Sandoyan answered, “The state should use all of its tools to provide general employment. It doesn’t mean that the state should create workplaces. It should do everything to create conditions, which would create workplaces. The state should do everything to ensure that the prices match with the lifestyle and wages of citizens. For example, the prices of real estate do not match with the incomes of our population at all because the supply and the demand are exegetic. These square meters are not built for us but for foreigners and Diaspora Armenians. The third function that our state should execute is the provision of economic growth, which is a result of state policy and indeed payment balance. The state has got nothing else to do than this at the moment. However our state is pretty busy inputting quotas on who has the right to import gasoline or medicine. That is the reason why we have what we have.” By the way, when speaking to us Edward Sandoyan also alluded to the amendments and changes to the laws on public education and language, which was yesterday being discussed at the NA. “We have appeared in a very ridiculous state due to the foreign language schools. It is quite common in Armenia that everybody is speaking of something that they don’t quite understand and often we like to politicize an issue, which has nothing common with politics, by trying to receive dividends because of that. This is a very bad disease and one of the most serious issues of our society. A really humiliating debate is taking place regarding the bill that is being discussed at the NA. They have even reached Vano Siradeghyan. It is becoming obnoxious when the issue relates to some value and it is being interpreted in such a primitive manner,” says the economist and adds that every person, who has any relation with the education process it well aware that the state has its own criteria of education. And according to him the better these criteria are developed the more protected and secure the culture and language of the state is. “If there is a foreign language school in Armenia it should work with the curriculum adopted in the Republic of Armenia. You are studying English but also learn Armenian equally and the subjects are in Armenian too; you learn an equal amount of history just like they do in Armenian language schools. It’s just you have some other elements. And the matter is not the shutdown of Armenian schools. They have just made the matter very primitive,” said Mr. Sandoyan. He has also expressed his discontent about the fact that the project of famous businessman Ruben Vardanyan didn’t come true. “Ruben Vardanyan has offered a wonderful initiative. That person was willing to invest 50 million USD in Dilijan and build an international school, which would host citizens of other countries, who’d seek quality education. It was a wonderful project of education exportation, which we failed. Instead of asking Vardanyan to implement this project, instead of helping him with whatever we can we failed this wonderful project. And he got angry and disappointed. Thus he said if you don’t want God with you, I’ll do it in some other country.”
Interviewed by Gayane Sahakyan