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EX-OFFICIAL CONCERNED OVER ACTUAL MILITARY BUDGET CUT
Sargis Harutyunyan
http://www.azatutyun.am/content/artic le/1845045.html
06.10.2009
A former deputy defense minister expects the planned actual curtailment
of military spending envisaged by Armenia's 2010 state budget to have
a negative effect on the country's defense capability.
His concerns, however, are not shared by the Defense Ministry's
chief financier, who says that the 30 percent reduction in spending
estimated in U.S. dollars reflects the corresponding depreciation of
the national currency that has taken place on the foreign exchange
market since the approval of the current year's budget in late 2008.
The actual reduction, meanwhile, follows the general pattern of the
government's request for the 2010 budgetary expenditures that it
plans to slash by nine percent citing the ongoing economic recession
and the resulting serious shortfall in tax revenues.
In an interview with RFE/RL on Tuesday, Vahan Shirkhanian, who served
as Armenia's deputy prime minister and deputy defense minister in the
late 1990s, said this development is certain to have an impact on the
overall fighting capacity of the Armenian army which he described as
a complex and dynamic structure that has enjoyed a sufficient level
of funding in recent years.
"The [military] budget would grow by $100-120 million every year and
that could not but have its [positive] effect in the matter of ensuring
[the country's] military security," he said. "But today we witness a
sharp increase of Azerbaijan's military budget and it is reflected not
only in the increase in funding, but also in its purchasing modern
high-precision weapons... I consider it unacceptable that Armenia
cut its military spending."
Speaking to RFE/RL on the phone, the Defense Ministry chief financier
Colonel Vagharshak Avetisian said that the Ministry had submitted
a request for about 130 billion drams in next year's budget, which
is nearly the same amount as the 2008 request for the current
year. However, he explained, considering the devaluation of the
national currency by nearly 30 percent, it turns out that the defense
budget in 2010 will be nearly 30 percent less.
At the end of 2008, when this year's military budget was approved,
it was equivalent to $426 million. At the current dollar-dram exchange
rate, the same amount in drams will be equivalent to $335 million.
But according to Avetisian, in any case the depreciation of the
national currency will not affect the Defense Ministry expenditure
in the main directions.
"Even if some changes are made in terms of reduction, then our main
spending spheres and directions will never be affected by that. And,
naturally, if there is a need for reduction, we can make cuts in
capital construction, while the other expenditure items will not be
affected," said Avetisian.
Avetisian also downplayed the impact of the exchange rate on military
purchases abroad that are transacted in hard currency.
"Our surveys show that the current level of prices [for weaponry]
abroad is lower than it was during the past years," he said.
Avetisian also brushed aside the argument made by the former defense
ministry official that certain budget reductions might cause some
discontent mainly among senior command staff who will have to complete
harder tasks with less funding.
"We have made a budget request based on this year's volumes. No changes
will be made in any spending direction. Moreover, there will be some
increase in money allowances," said Avetisian. "I can say that our
armed forces will be provided with everything that is necessary to
achieve our objectives at a given period of time."
Sargis Harutyunyan
http://www.azatutyun.am/content/artic le/1845045.html
06.10.2009
A former deputy defense minister expects the planned actual curtailment
of military spending envisaged by Armenia's 2010 state budget to have
a negative effect on the country's defense capability.
His concerns, however, are not shared by the Defense Ministry's
chief financier, who says that the 30 percent reduction in spending
estimated in U.S. dollars reflects the corresponding depreciation of
the national currency that has taken place on the foreign exchange
market since the approval of the current year's budget in late 2008.
The actual reduction, meanwhile, follows the general pattern of the
government's request for the 2010 budgetary expenditures that it
plans to slash by nine percent citing the ongoing economic recession
and the resulting serious shortfall in tax revenues.
In an interview with RFE/RL on Tuesday, Vahan Shirkhanian, who served
as Armenia's deputy prime minister and deputy defense minister in the
late 1990s, said this development is certain to have an impact on the
overall fighting capacity of the Armenian army which he described as
a complex and dynamic structure that has enjoyed a sufficient level
of funding in recent years.
"The [military] budget would grow by $100-120 million every year and
that could not but have its [positive] effect in the matter of ensuring
[the country's] military security," he said. "But today we witness a
sharp increase of Azerbaijan's military budget and it is reflected not
only in the increase in funding, but also in its purchasing modern
high-precision weapons... I consider it unacceptable that Armenia
cut its military spending."
Speaking to RFE/RL on the phone, the Defense Ministry chief financier
Colonel Vagharshak Avetisian said that the Ministry had submitted
a request for about 130 billion drams in next year's budget, which
is nearly the same amount as the 2008 request for the current
year. However, he explained, considering the devaluation of the
national currency by nearly 30 percent, it turns out that the defense
budget in 2010 will be nearly 30 percent less.
At the end of 2008, when this year's military budget was approved,
it was equivalent to $426 million. At the current dollar-dram exchange
rate, the same amount in drams will be equivalent to $335 million.
But according to Avetisian, in any case the depreciation of the
national currency will not affect the Defense Ministry expenditure
in the main directions.
"Even if some changes are made in terms of reduction, then our main
spending spheres and directions will never be affected by that. And,
naturally, if there is a need for reduction, we can make cuts in
capital construction, while the other expenditure items will not be
affected," said Avetisian.
Avetisian also downplayed the impact of the exchange rate on military
purchases abroad that are transacted in hard currency.
"Our surveys show that the current level of prices [for weaponry]
abroad is lower than it was during the past years," he said.
Avetisian also brushed aside the argument made by the former defense
ministry official that certain budget reductions might cause some
discontent mainly among senior command staff who will have to complete
harder tasks with less funding.
"We have made a budget request based on this year's volumes. No changes
will be made in any spending direction. Moreover, there will be some
increase in money allowances," said Avetisian. "I can say that our
armed forces will be provided with everything that is necessary to
achieve our objectives at a given period of time."