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Armenian parliament approves controversial budget

08 December 2014 [10:47] - TODAY.AZ

/By AzerNews/

By Mushvig Mehdiyev

The Armenian parliament approved the state budget for 2015 on December 4 with 71 pros and 46 cons.

The approval of the controversial draft budget sparked mixed reactions among the members of parliament, receiving approval only from the ruling Republicans Party devotees.

"The government should prove that it will fight the shadow economy and monopoly before approving the budget. We need to ignore monopoly to prevent the people from buying gas for $189," said Ruben Akopyan, legislator from the Heritage party, voting against the budget.

Widespread monopoly remains a headache to Armenian economy, killing healthy business environment and competitiveness in the markets. The Global Competitiveness Report 2014 ranked Armenia 105 among 144 countries for the rate of effectiveness of antitrust policy, which is paralyzed by the widespread monopoly mostly controlled by the oligarch state officials.

Head of the parliamentary faction Orinats Erkir, Egine Bisharyan, protested against the approval of the draft budget, saying the government should firstly find a magic wand to save the life of people.

Levon Zurabyan, Head of the Armenian National Congress faction, said the economic crisis in Armenia would hit the bottom following the execution of the budget.

Prime Minister Hovik Abrahamyan addressed the parliamentary meeting to calm down the ardent legislators, claiming the draft budget to be realistic. "The government don't follow a short-term interests, but prefers to perspective programs," he noted.

Armenia's state budget for 2015 remained in a hot seat since it has been developed and submitted for the parliament's discussion. Inadequate articles in the document raised a serious concern among the parliament members, who believed the budget would fail to tackle social problems, keeping them same also in the next year. Prime Minister Abrahamyan has earlier stressed that about 21.4 percent of the budget will be spent for defense, maintenance of public order and national security.

According to local media, only members of the ruling Republican Party voted for the budget, while the rest parliamentarians unanimously opposed to approve it. The Republican Party holds the majority of the parliamentary seats, which considerably affected the number of supporters.

The Armenian dram's depreciation against the dollar and euro is not a secret anymore, since it became a threatening factor to the country's financial state. Recent value of the dram is the lowest over the last seven years in Armenia. A dollar is now changed for nearly 450 drams, proving the collapsing position of Armenia's national currency in its exchange markets.

Several economic experts claim that the state budget for 2015 does not reflect the real financial situation, as it envisages improper rate of dram against the dollar. The budget confirms that one dollar stands at 411 drams, but it is currently exchanged for 450 drams in Armenia.

The Armenian parliament also ratified the agreement on joining the Eurasian Economic Union on December 4. Simultaneous ratification of the budget and the EEU integration will cause a serious headache to Armenia, according to economic experts.

Bagrat Asatryan, ex-Head of Armenia's Central Bank, has earlier claimed that the budget for the next year was the remnant of the mid-term program developed by the previous government, as it does not reflect the real condition in Armenia related to the membership at the EEU.


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