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ACCORDING TO ANC, 2010 BUDGET IS BUDGET OF AUTHORITIES' MISTAKES AND LACK OF FORESIGHT AND THEIR RESIGNATION
Noyan Tapan
Nov 6, 2009
YEREVAN, NOVEMBER 6, NOYAN TAPAN. The Armenian National Congress
(ANC) on November 6 issued a statement, in which it expressed its
opinion about the 2010 state budget of Armenia.
The statement reads:
"The Armenian National Congress has repeatedly warned that the
steps undertaken by the Armenian government under the conditions
of the financial and economic crisis are quite inadequate for the
prevention or mitigation of the current negative developments. The
result of ignoring numerous warnings is that even after attracting
an unprecedented loan of 1.5 billion dollars from the outside world,
Armenia surpasses all CIS countries and nearly all countries of the
world in terms of the official index of its economic decline.
In fact, the so-called preventive economic measures taken by the
authorities are aimed at feeding, strengthening and maintaining the
corrupt power system rather than at protecting the interests of the
state and the citizens and at solving the existing problems.
Throughout 2009, concealing its failures and inability to deal with
any serious problem, the government - in various ways evading the
law - changed the National Assembly-adopted law on the budget and,
as a matter of fact, carried out shadow sequestration of the budget
post factum. Under such condutions, the 2010 draft state budget,
which ignores the real problems and challenges facing our country,
has been developed and presented to the National Assembly.
Thus:
- About 25% reduction in revenues is envisaged as compared to this
year, whereas economic growth is forecast for next year by the
authorities.
- Serious cuts have been announced in education (about 25%) and defence
(over 22%) compared to 2009, whereas expenditures on maintenance of
the state machinery have been left almost unchanged.
- An extremely low and declining level of taxes is programmed in the
taxes-GDP ratio, which in fact means that the authorities will not
fight the shadow economy and corruption.
- A huge budget deficit in the amount of 6.5% of GDP is envisaged.
The Armenian National Congress states that for any authorities, this
budget is a budget of their own mistakes and lack of foresight and
their resignation.
Being aware that the deepening of the economic downturn and the
financial crisis, as well as the inadequate steps on their prevention
are fraught even with the danger of a humanitarian disaster, the
Armenian National Congress once again considers it necessary to present
those principles and measures, whose use would only make it possible
to mitigate the current hard situation which is expected to worsen:
The principles of special anticrisis 5-year economic, social and
financial programming should form the basis of the 2010 state budget.
Realistic anticrisis measures rather than abstract and fairy-tale
promises and judgements should be the pivot of the indicated program.
These measures are:
- To gradually increase the revenue collection level in this 5-year
period, reaching a 22% level of the taxes-GDP ratio.
- To adopt a list of tax and customs reforms and the respective
documents, which should be aimed at introducing the principle of
progressive taxation when the tax burden is moved from the consumer
to the income consumer, from low-income consumers to high-income
consumers, the well-off stratum of society.
- To develop a package of system changes, which shall include a real
program of anticorruption and antimonopoly measures and specify a
fair economic competition atmosphere in Armenia.
- Instead of encouraging elite apartment construction, to envisage
programs on affordable apartments construction, including housing
for young families.
- To develop special programs on unemployment reduction, especially
measures on the rehabilitation of local inter-village roads,
infrastructure in rural areas and the development of communities,
and to envisage their financing from the budget.
- To allocate foreign loans for the extension of the demand rather than
the supply and to stop crediting (giving guarantees to) the so-called
"elite" developers, etc."
According to the statement, ANC has its program of measures for
overcoming the crisis, and in case of the existence of the respective
political will and the adoption of several dozen laws and decisions,
it will be possible to put the country on the development path again.
Noyan Tapan
Nov 6, 2009
YEREVAN, NOVEMBER 6, NOYAN TAPAN. The Armenian National Congress
(ANC) on November 6 issued a statement, in which it expressed its
opinion about the 2010 state budget of Armenia.
The statement reads:
"The Armenian National Congress has repeatedly warned that the
steps undertaken by the Armenian government under the conditions
of the financial and economic crisis are quite inadequate for the
prevention or mitigation of the current negative developments. The
result of ignoring numerous warnings is that even after attracting
an unprecedented loan of 1.5 billion dollars from the outside world,
Armenia surpasses all CIS countries and nearly all countries of the
world in terms of the official index of its economic decline.
In fact, the so-called preventive economic measures taken by the
authorities are aimed at feeding, strengthening and maintaining the
corrupt power system rather than at protecting the interests of the
state and the citizens and at solving the existing problems.
Throughout 2009, concealing its failures and inability to deal with
any serious problem, the government - in various ways evading the
law - changed the National Assembly-adopted law on the budget and,
as a matter of fact, carried out shadow sequestration of the budget
post factum. Under such condutions, the 2010 draft state budget,
which ignores the real problems and challenges facing our country,
has been developed and presented to the National Assembly.
Thus:
- About 25% reduction in revenues is envisaged as compared to this
year, whereas economic growth is forecast for next year by the
authorities.
- Serious cuts have been announced in education (about 25%) and defence
(over 22%) compared to 2009, whereas expenditures on maintenance of
the state machinery have been left almost unchanged.
- An extremely low and declining level of taxes is programmed in the
taxes-GDP ratio, which in fact means that the authorities will not
fight the shadow economy and corruption.
- A huge budget deficit in the amount of 6.5% of GDP is envisaged.
The Armenian National Congress states that for any authorities, this
budget is a budget of their own mistakes and lack of foresight and
their resignation.
Being aware that the deepening of the economic downturn and the
financial crisis, as well as the inadequate steps on their prevention
are fraught even with the danger of a humanitarian disaster, the
Armenian National Congress once again considers it necessary to present
those principles and measures, whose use would only make it possible
to mitigate the current hard situation which is expected to worsen:
The principles of special anticrisis 5-year economic, social and
financial programming should form the basis of the 2010 state budget.
Realistic anticrisis measures rather than abstract and fairy-tale
promises and judgements should be the pivot of the indicated program.
These measures are:
- To gradually increase the revenue collection level in this 5-year
period, reaching a 22% level of the taxes-GDP ratio.
- To adopt a list of tax and customs reforms and the respective
documents, which should be aimed at introducing the principle of
progressive taxation when the tax burden is moved from the consumer
to the income consumer, from low-income consumers to high-income
consumers, the well-off stratum of society.
- To develop a package of system changes, which shall include a real
program of anticorruption and antimonopoly measures and specify a
fair economic competition atmosphere in Armenia.
- Instead of encouraging elite apartment construction, to envisage
programs on affordable apartments construction, including housing
for young families.
- To develop special programs on unemployment reduction, especially
measures on the rehabilitation of local inter-village roads,
infrastructure in rural areas and the development of communities,
and to envisage their financing from the budget.
- To allocate foreign loans for the extension of the demand rather than
the supply and to stop crediting (giving guarantees to) the so-called
"elite" developers, etc."
According to the statement, ANC has its program of measures for
overcoming the crisis, and in case of the existence of the respective
political will and the adoption of several dozen laws and decisions,
it will be possible to put the country on the development path again.