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The social-economic developments in the economy of the RA for January-April 2022

In the present analysis, given the data published by the Statistical Committee of the RA, we study the recent social-economic developments in the economy of the RA. In particular, we consider the cumulative indicator of economic activity of the given month, its sectoral distribution, as well as the dynamics of individual sectors of the economy. We also analyze economic developments in the foreign trade, labour market and fiscal system of the RA. In addition, some aspects of the financial system (inflation, deposits and loans), as well as the behaviour of the exchange rate, are touched upon. Full material is only available in Armenian.

  


Issues in the crediting sector of Armenia as a result of the change of power in 2018 and their macroeconomic implications in the context of the 2020 turmoil

As a result of the short-sighted and populist policy of the Armenian government the process of accumulation of problematic risks has been registered in the loan portfolio of the financial system of Armenia, since 2018. Subsequently, the credit sector faced certain challenges that had a significant negative impact on the macroeconomic environment of Armenia due to the 2020 crisis. The above-mentioned developments were analyzed in the work. The study shows that government actions led to a sharp deepening of the debt burden (in the form of consumer and mortgage loans) of the household sector in 2018-2019. In the crisis environment of 2020, this contributed to a much deeper decline in the level of welfare of the population, reflected in both a sharp decline in demand (consumption) and an increase in the volume of low-quality loans. In the post-crisis period, the problem of household debt burden remains unresolved, which raises additional concerns amid the negative shocks to the Armenian economy following the escalating Russian-Ukrainian war in February 2022. As a result of government short-sightedness and a post-2018 boom in mortgage lending, the fiscal space to weather 2020 shocks has been smaller than expected. At the same time, the problem of mortgage loans has not yet been fully resolved, which is why the state suffers more and more revenue losses from year to year. The latter, in the environment of the already existing economic shocks, contributes to the accumulation of risks endangering fiscal stability. The full material is available only in Armenian.

  


Armenian "6 principles" - a basis for negotiations or a diplomatic adventure?

In an interview with the Armenian Public Television on May 13 Ambassador for Special Assignments Edmon Marukyan unveiled 6 points presented by Armenia in response to 5 points previously submitted by Azerbaijan, on the basis of which it is proposed to start negotiations on a peace agreement between Armenia and Azerbaijan. The “Luys” Foundation, referring to the points published by both Azerbaijan and Armenia, tried to analyze their content.

We noted that the “proposals/principles” presented by Azerbaijan and Armenia are extremely incomparable both in terms of their content, international perception and the reaction of mediators. At the same time, we presented some proposals that, if properly formulated and presented, could/can give the Armenian side the opportunity to approach the start of the negotiation process from a position that is more reasonable, internationally acceptable and invulnerable from the point of view of international law. The full material is available only in Armenian.

  


Armenian lobby under the Biden administration

This article discusses the impact of the lobbying organizations on U.S. policy, particularly through ethnic and professional lobbies. Special attention is paid to the priorities of Armenian ethnic lobbying organizations in the United States, more specifically the activities of the Armenian National Committee of America and the Armenian Assembly of America, as well as their priorities under the Biden administration. For this purpose, the specific steps taken by the Armenian lobbying organizations and their achievements within the framework of the above-mentioned priorities were analyzed. The full material is available only in Armenian.

  


Business support incentives applied in Armenia after the change of power

In 2018, the new authorities of the Republic of Armenian announced about the start of an "economic revolution", one of the key components of which was the assessment of the efficiency and transparency of tax and customs incentives provided to businesses, the elimination of inefficient incentives and the definition of new more targeted and effective support mechanisms. What we have today? What steps have been taken by the government to achieve the mentioned goals? This analysis presents the main tax and customs incentives applied to support businesses in Armenia, the main changes done in recent years and the steps undertaken by the Government to increase efficiency and accountability of the applied incentives. The full material is available only in Armenian.

  


On the execution report of the state budget of the RA for the first quarter of 2022

The objective of the present analysis is to assess the execution of the state budget of the RA in the given period. First, we describe the general state of the economy of the RA, namely the driving forces of economic activity, the developments in individual sectors of the economy. Afterwards, we analyze the performance of government revenues and expenditures by comparing the actual and planned values of the respective indicators. We conclude the analysis by summarizing the main observations and results. Full material is only available in Armenian.

  


CAUSES AND CONSEQUENCES OF INFLATION. How much has the real standard of living of the population decreased due to accelerating inflation since the end of 2020?

In 2021 the highest rate of inflation of the past 10 years was registered, which is driven by both external and internal factors. High inflation has had significant negative socio-economic consequences, that are analysed in this study.

The paper presents the macroeconomic implications of accelerating inflation and raising interest rate of the Central Bank of Armenia (as a response to high inflation), as well as the effects of inflation on the living standards of the population.

The results show that inflation has significantly slowed down the real growth of the population's income. At the same time, the income growth of those with high living standards was significantly higher than that of the socially vulnerable population, resulting in increased income inequality. Moreover, due to the leading increase in the prices of primary consumer goods, the increase in prices was 8.5% for the poorest households and 6.1% for the richest.

In these conditions, in 2022. As a result of the Russian-Ukrainian conflict, since February 2012, world prices for energy and food have risen sharply, which will inevitably lead to an acceleration of inflation in Armenia (already noticeable in March), meaning that that the negative effects described above will go deeper in 2022. Full material is only available in Armenian.

  


What is hidden in the indicators of the Stockholm Institute (SIPRI) database related to Armenia?

In this article, we tried to figure out what the database of the arms transfer program of the Stockholm International Peace Research Institute (SIPRI) is, to what extent it reflects the real picture of the arms trade, and what interesting indicators about Armenia are hidden there. Full material is only available in Armenian.

  


Once again? “Rudderless, scattered, non-ideological” Ignorance, deceit and trickery signal new catastrophe

The article discusses the programme approaches to the Artsakh issue presented by the Government of the Republic of Armenia on April 13-14, during the discussion of the 2021 budget execution at the sitting of the National Assembly. It addresses the references made with regard to the conflict settlement documents, the issues related to Artsakh's self-determination and Azerbaijan's territorial integrity, statements made on behalf of the international community, issues related to the settlement of the conflict with the consent of Azerbaijan, the aims and objectives of the lawsuit filed by Armenia in the International Court of Justice, the possibility of concluding a "peace treaty" between Armenia and Azerbaijan and its consequences, the principles put forward by Azerbaijan in this regard, as well as the self-assessment of the activities of the RA Prime Minister. The analysis of the views on these issues and the comparison of the results show that regardless of a non-specific style of programme approaches, the focused development of key ideas and the subsequent use of destructive approaches suggest that, in terms of content, a comprehensive position was presented on the issues vital for the country, which can be unconditionally considered as programmatic. It is argued that the total use of systematic combinations of lies, tricks and deceit is fraught with serious consequences. Moreover, the danger of the presented steps of the program and further developments increases significantly amid the decisive stage of the struggle to establish a new world order. Under the current extremely difficult and dangerous situation created for Armenia and Artsakh, the mission of the Armenian opposition needs to be reformulated. It is necessary to make serious inquiries into the mistakes made in the previous two stages of the struggle, to get rid of promises and exhortations conditioned by external impulses, as well as of artificial underestimation of internal factors ("the people are not ready yet", etc.). The ways and means of political activity must be radically reconsidered. The will to exclude the expression of fragmented interests, to exclude the repetition of mistakes in the whole period following the re-establishment of independence, as well as the determination to build free and fair Republic of Armenia and Republic of Artsakh capable to defend itself and its citizens must be clearly stated. Otherwise, the opposition will become the same accomplice of past and future disasters as the current government is with its words. Full material is only available in Armenian.

  


The social-economic developments in the economy of the RA for January-March 2022

In the present analysis, given the data published by the Statistical Committee of the RA, we study the recent social-economic developments in the economy of the RA. In particular, we consider the cumulative indicator of economic activity of the given month, its sectoral distribution, as well as the dynamics of individual sectors of the economy. We also analyze economic developments in the foreign trade, labour market and fiscal system of the RA. In addition, some aspects of the financial system (inflation, deposits and loans), as well as the behaviour of the exchange rate, are touched upon. Full material is only available in Armenian.

  


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