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DE-CONSTRUCTION: BUILDING INDUSTRY DOWN 25 PERCENT; ECONOMIC ACTIVITY DROPS 18 PERCENT FROM SEPTEMBER
NAZIK ARMENAKYAN
ArmeniaNow
22.11.11 | 13:50
By Sara Khojoyan
ArmeniaNow reporter
According to the National Statistics Service of Armenia, the country's
economic activity was 18 percent less in October than in September.
The main reason of the decline was the 25-percent drop in construction
(in the first 10 months of this year, compared to last).
Economist Ara Nranyan, lawmaker from the Armenian Revolutionary
Federation (ARF, Dashnaktsutyun) parliamentary faction, says that
the decline in the construction sector is, in fact, determined by
the ongoing financial crisis.
"Even though the Government presents the decline of construction
sector as a result of the economy's diversification, I do not think
that the industry actually develops," Nranyan says.
According to Nranyan, the executive authorities of Armenia have started
paying less attention to the construction sector, even reducing the
allotment of funds designated for the industry next year.
In 2012, four billion drams (about $10 million) will be allotted to
apartment construction, even though before that more than 20 billion
drams (about $52 million) was allotted; and as for the general
construction - 12 billion drams (about $31 million) instead of the
previous 30 billion drams (about $78 million).
"Construction is a system creating trend of the economy, and the
Government, according to us, has taken a wrong course. Instead of
promoting demand and creating corresponding mechanisms for it, the
Government has created preferential terms for construction companies
to finish their work," Nranyan says.
However, there is a low demand for new apartments and not only
because the population of Armenia (who inherited homes from the Soviet
system) does not need apartments. The problem, according to the ARF
representative, is the absence of a special social welfare oriented
program, which would give people with low incomes an opportunity to
buy apartments.
One such program was Affordable Housing for Young Families initiated
by the Government three years ago. Under the program only 580 young
families have been granted preferential mortgage loans.
From: A. Papazian
NAZIK ARMENAKYAN
ArmeniaNow
22.11.11 | 13:50
By Sara Khojoyan
ArmeniaNow reporter
According to the National Statistics Service of Armenia, the country's
economic activity was 18 percent less in October than in September.
The main reason of the decline was the 25-percent drop in construction
(in the first 10 months of this year, compared to last).
Economist Ara Nranyan, lawmaker from the Armenian Revolutionary
Federation (ARF, Dashnaktsutyun) parliamentary faction, says that
the decline in the construction sector is, in fact, determined by
the ongoing financial crisis.
"Even though the Government presents the decline of construction
sector as a result of the economy's diversification, I do not think
that the industry actually develops," Nranyan says.
According to Nranyan, the executive authorities of Armenia have started
paying less attention to the construction sector, even reducing the
allotment of funds designated for the industry next year.
In 2012, four billion drams (about $10 million) will be allotted to
apartment construction, even though before that more than 20 billion
drams (about $52 million) was allotted; and as for the general
construction - 12 billion drams (about $31 million) instead of the
previous 30 billion drams (about $78 million).
"Construction is a system creating trend of the economy, and the
Government, according to us, has taken a wrong course. Instead of
promoting demand and creating corresponding mechanisms for it, the
Government has created preferential terms for construction companies
to finish their work," Nranyan says.
However, there is a low demand for new apartments and not only
because the population of Armenia (who inherited homes from the Soviet
system) does not need apartments. The problem, according to the ARF
representative, is the absence of a special social welfare oriented
program, which would give people with low incomes an opportunity to
buy apartments.
One such program was Affordable Housing for Young Families initiated
by the Government three years ago. Under the program only 580 young
families have been granted preferential mortgage loans.
From: A. Papazian