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Overview: Armenian economy 2012
Brief overview of main economic events of 2012 in Armenia
In 2012, Armenia faced several significant economic events which may
have further positive influence on the development of this sphere and
the country in general. PanARMENIAN.Net provides a brief overview of
the developments of this year.
December 28, 2012
PanARMENIAN.Net - Social benefits for public servants
Starting January 2012, social benefit package was introduced for
Armenia's civil and public servants, state officials, as well as
administrative and professional employees in state-run organizations
in the spheres of culture, education, and social security.
The package envisaging allocation of 132000 AMD to each employee
provides certain social services to approximately 120 000 public
servants and their direct family members, the spouses and children up
to 27 years of age, regardless of their positions and salary.
The social package includes mandatory health insurance, monthly
payments of mortgage loans and tuition fees, as well as vacation in
Armenia and Nagorno Karabakh.
52 000 AMD will be spent for mandatory health insurance monthly,
accounting for 3.8 mln AMD per year. The insurance within this
programme covers a range of medical services including neurosurgical
and cardiac operations.
The social package does not comprise the staff reserve, state
employees working less than six months, as well as high-ranking
officials and those providing for technical support.
Free Trade Area agreement with EU
On February 20, the 27-member EU Trade Policy Commission unanimously
approved the decision to launch negotiations with Armenia for Deep and
Comprehensive Free Trade Area (DCFTA).
The positive decision of the Commission came as result of steps aimed
at preparation of talks Armenia implemented during the past year.
Launch of negotiations required legislative amendments, improved
implementation of law and strengthening of relevant structures in
areas related to foreign trade.
This agreement will provide Armenia with access to EU's 500 million
market, with average $30-40 thousand GDP per capita and high
purchasing power. Access to such large market will promote Armenia's
economic development both in terms of quantity and quality, since only
quality commodities can enter Europe. This will help introduce new
capacities and technologies in the country and boost competitiveness.
Doing business
Armenia marked 18-point progress in the annual Doing Business 2013
ranking of the World Bank and IFC, being now placed 32th instead of
50th.
Armenia is placed between the Netherlands (31th) and Belgium (33rd),
leaving behind France (34th), Israel (38th), South Africa (39th) and
Spain (44th).
According to this report, Armenia improved some of its indicators, in
particular, `provision of construction permits' (46th), `electricity
supply (101st)', `protection of investors' (25th), and `taxation'
(108th). Also, regress with regard to the following indicators was
recorded: `registration of enterprises', `loans', `international
trade'.
Singapore tops the list of countries with most favourable business
environment. The top ten includes also Hong Kong, New Zealand, the
U.S., Denmark, Norway, Great Britain, Korea, Georgia, and Australia.
Georgia still maintains its leading position (9th), followed by
Estonia (21st), Latvia (25th), Lithuania (27th), Armenia (32nd),
Kazakhstan (49th), Belarus (58th), Azerbaijan (67th), Kyrgyzstan
(70th), Moldova (83rd), Russia (112th), Ukraine (137th), Tajikistan
(141st), Uzbekistan (154th).
Minimum wages
On September 27, the government of Armenia approved the bill on
increasing the minimum salary up to 35000 AMD.
Currently the minimum salary in Armenia makes 32500 AMD.
The law is expected to enter into force starting January 1, 2013.
Introduction of new income tax model
The new Law `On Income Tax' becomes effective starting January 1, 2013.
Currently the most part of the monthly social insurance payment is
provided by the employer, while the new law stipulates that starting
January 1, the employees must pay the total sum from their salaries.
For their part, the employers should raise the wages of their staff so
that the actual income of the latters does not suffer.
Introduction of the new model of income tax is linked to the funded
pension system launched in Armenia on January 1, 2011.
As of January 1, 2011, voluntary funded pension system was introduced
in the country. Starting January 1, 2014 Armenia shifts to mandatory
funded pension system comprising all citizens born after January 1,
1974.
Victoria Araratyan / PanARMENIAN News
Brief overview of main economic events of 2012 in Armenia
In 2012, Armenia faced several significant economic events which may
have further positive influence on the development of this sphere and
the country in general. PanARMENIAN.Net provides a brief overview of
the developments of this year.
December 28, 2012
PanARMENIAN.Net - Social benefits for public servants
Starting January 2012, social benefit package was introduced for
Armenia's civil and public servants, state officials, as well as
administrative and professional employees in state-run organizations
in the spheres of culture, education, and social security.
The package envisaging allocation of 132000 AMD to each employee
provides certain social services to approximately 120 000 public
servants and their direct family members, the spouses and children up
to 27 years of age, regardless of their positions and salary.
The social package includes mandatory health insurance, monthly
payments of mortgage loans and tuition fees, as well as vacation in
Armenia and Nagorno Karabakh.
52 000 AMD will be spent for mandatory health insurance monthly,
accounting for 3.8 mln AMD per year. The insurance within this
programme covers a range of medical services including neurosurgical
and cardiac operations.
The social package does not comprise the staff reserve, state
employees working less than six months, as well as high-ranking
officials and those providing for technical support.
Free Trade Area agreement with EU
On February 20, the 27-member EU Trade Policy Commission unanimously
approved the decision to launch negotiations with Armenia for Deep and
Comprehensive Free Trade Area (DCFTA).
The positive decision of the Commission came as result of steps aimed
at preparation of talks Armenia implemented during the past year.
Launch of negotiations required legislative amendments, improved
implementation of law and strengthening of relevant structures in
areas related to foreign trade.
This agreement will provide Armenia with access to EU's 500 million
market, with average $30-40 thousand GDP per capita and high
purchasing power. Access to such large market will promote Armenia's
economic development both in terms of quantity and quality, since only
quality commodities can enter Europe. This will help introduce new
capacities and technologies in the country and boost competitiveness.
Doing business
Armenia marked 18-point progress in the annual Doing Business 2013
ranking of the World Bank and IFC, being now placed 32th instead of
50th.
Armenia is placed between the Netherlands (31th) and Belgium (33rd),
leaving behind France (34th), Israel (38th), South Africa (39th) and
Spain (44th).
According to this report, Armenia improved some of its indicators, in
particular, `provision of construction permits' (46th), `electricity
supply (101st)', `protection of investors' (25th), and `taxation'
(108th). Also, regress with regard to the following indicators was
recorded: `registration of enterprises', `loans', `international
trade'.
Singapore tops the list of countries with most favourable business
environment. The top ten includes also Hong Kong, New Zealand, the
U.S., Denmark, Norway, Great Britain, Korea, Georgia, and Australia.
Georgia still maintains its leading position (9th), followed by
Estonia (21st), Latvia (25th), Lithuania (27th), Armenia (32nd),
Kazakhstan (49th), Belarus (58th), Azerbaijan (67th), Kyrgyzstan
(70th), Moldova (83rd), Russia (112th), Ukraine (137th), Tajikistan
(141st), Uzbekistan (154th).
Minimum wages
On September 27, the government of Armenia approved the bill on
increasing the minimum salary up to 35000 AMD.
Currently the minimum salary in Armenia makes 32500 AMD.
The law is expected to enter into force starting January 1, 2013.
Introduction of new income tax model
The new Law `On Income Tax' becomes effective starting January 1, 2013.
Currently the most part of the monthly social insurance payment is
provided by the employer, while the new law stipulates that starting
January 1, the employees must pay the total sum from their salaries.
For their part, the employers should raise the wages of their staff so
that the actual income of the latters does not suffer.
Introduction of the new model of income tax is linked to the funded
pension system launched in Armenia on January 1, 2011.
As of January 1, 2011, voluntary funded pension system was introduced
in the country. Starting January 1, 2014 Armenia shifts to mandatory
funded pension system comprising all citizens born after January 1,
1974.
Victoria Araratyan / PanARMENIAN News