Economic growth in Armenia not to exceed 3% in 2019 – economist

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YEREVAN, July 20. /ARKA/. Economic growth in Armenia will not exceed 3% in 2019 despite of the high indicators recorded in the first half of this year, Karlen Khachatryan, and economist, said answering ARKA News Agency’s question.

“Many things will depend on the cropping season , which will actively begin in August, but I don’t think it can ensure high indices,” he said.

Khachatryan called into question the announced 7.3% economic activity growth saying it had no impact on creation of new jobs and reduction of unemployment.

“According to the official statistical reports for the last year, there is no any positive dynamics in reduction of unemployment, and therefore it is impossible to speak about positive trends at the labor market,” he said adding that this is the result of the general state of the economy.

Admitting that certain progress is seen in some areas, Khachatryan still thinks that the current economic policy contributes noting to economic development creation of new jobs.

The 50,000 new jobs reported by Prime Minister Nikol Pashinyan are nothing more than disinformation, since there is no such a figure in statistical reports.

“The premier spoke about 50,000 jobs, but noting like that is seen in the figures of payments to the Fund for Support of Servicemen,” Khachatryan said. “With monthly payments of 1,000 drams to the fund, it had to receive extra 50 million drams evry month, but nothing like that happened. I think officials provided incorrect data to the premier.”

Instead, imports, exports and foreign investments have dwindled.

Khachatryan is convinced that to encourage investors it is necessary to create favorable business environment, for which an independent judicial system is needed as well as full-extent protection of rights, including the property right, and Armenia’s environment is not favorable.

He also stressed the importance of a right tax policy, particularly a just distribution of tax burden among businesses.

In his words, 85% of the tax revenue comes from 600 to 700 large taxpayers, while the remaining 15 percent is paid by 74,000 organizations.

In his opinion, small businesses’ tax burden is heavy and this hobbles their development.

Khachatryan thinks a stricter tax administration should be applied to big taxpayers, while in the reality, he sees quite the opposite.

He is convinced that radical tax changes are needed, but they are not ensured by the new tax code, since the social justice principle is not ensured.

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