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AUA STUDY: MINING IN ARMENIA CREATES POVERTY, INCOME INEQUALITY
April 16, 2013
YEREVAN-While mining contributed to economic growth in Armenia
between 2004-10, it simultaneously created income inequality and
poverty, according to a recent study by the AUA Acopian Center for
the Environment (ACE), conducted in cooperation with the AUA College
of Business and Economics (CBE).
'The mining sector is likely to increase income inequality and deepen
poverty in the regions of Armenia in which it operates.' The study's
principal researcher and author, Dr. Aleksandr Grigoryan, looked at
regional-level data and reports that mining does have some positive
impact on the growth of the economy. "This supports the claim often
repeated by proponents of mining that it is needed for Armenia's
economic growth," said Grigoryan, an assistant professor of economics
at AUA.
His analysis, however, also showed that "...the mining sector is likely
to increase income inequality and deepen poverty in the regions of
Armenia in which it operates."
This runs counter to claims by mining proponents that the sector
creates jobs that will have medium- to long-term development impact
on the regions and the country.
These conflicting realities can be explained by a number of factors
prevalent in Armenia's economy. "Mining has been growing as a share of
the Armenian economy for several years now but with the economic crisis
and increase in world metal prices, mining took on a more significant
role in our GDP growth," he explained, noting that this trend is
expected to continue if no other sector of the economy picks up steam.
An increase in poverty is another observed effect of mining, a
relationship that, Grigoryan said, needs to be studied further. Other
research on the impact of mining conducted by the AUA School of Public
Health and AUA ACE reports some residents claiming that property
owners are forced to sell their properties at very low prices. Such
occurrences, if they have taken place, would deprive villagers of an
asset critical to wealth creation, according to Grigoryan.
Moreover, workers in the mining or mineral processing industries are
not provided health insurance, a fact that may burden families with
health costs or lower productivity.
The role of policy
"If we are to make mining a key sector in the Armenian economy,
we also have to develop the right socio-economic policies where the
immediate communities and the country benefits maximally," said Alen
Amirkhanian, the director of the AUA Acopian Center.
Mining and extractive industries have played a significant role
in ensuring long-term and equitable growth for several countries,
particularly Norway, Australia, and Botswana. "These countries have
successfully used mining to raise the standard of living for a vast
majority of their populations because they devised and implemented good
public policy," stressed Amirkhanian, who organized an international
conference last November on the topic.
Without proper policies designed to regulate and leverage mining,
Armenia will continue on a path that follows mining models that enrich
a few while depriving larger numbers of current and future generations
of opportunities to benefit from their patrimony, said Amirkhanian.
According to the Armenian Statistical Service, in 2011, Armenia's
mining industry employed 15,500 workers, or about 1 percent, of the
country's total employment and contributed to about 3 percent of
its GDP.
AUA is organizing another international scientific conference
on"Emerging Issues in Environmental and Occupational Health." The
conference, set for April 22-23, will bring leading experts from around
the world to Yerevan to explore the impact of mining and construction
in transition economies such as Armenia. The research they present
will provide solutions to the occupational and environmental health
problems facing workers, communities, and children, and help craft
public policy to address these issues.
The AUA Acopian Center for the Environment is a research center of the
American University of Armenia (AUA). AUA ACE promotes the protection
and restoration of the natural environment through research, education,
and community outreach. AUA ACE's focus areas include sustainable
natural resource management, biodiversity and conservation, greening
the built environment, clean energy and energy efficiency, as well
as information technology and the environment.
The College of Business and Economics (CBE) at AUA is the leading
business school in the region, promoting entrepreneurship, innovation
and ethical leadership. CBE has catered to Armenian and international
students, corporations, and communities for the past 20 years.
http://www.armenianweekly.com/2013/04/16/aua-study-mining-in-armenia-creates-poverty-income-inequality/
From: Emil Lazarian | Ararat NewsPress
April 16, 2013
YEREVAN-While mining contributed to economic growth in Armenia
between 2004-10, it simultaneously created income inequality and
poverty, according to a recent study by the AUA Acopian Center for
the Environment (ACE), conducted in cooperation with the AUA College
of Business and Economics (CBE).
'The mining sector is likely to increase income inequality and deepen
poverty in the regions of Armenia in which it operates.' The study's
principal researcher and author, Dr. Aleksandr Grigoryan, looked at
regional-level data and reports that mining does have some positive
impact on the growth of the economy. "This supports the claim often
repeated by proponents of mining that it is needed for Armenia's
economic growth," said Grigoryan, an assistant professor of economics
at AUA.
His analysis, however, also showed that "...the mining sector is likely
to increase income inequality and deepen poverty in the regions of
Armenia in which it operates."
This runs counter to claims by mining proponents that the sector
creates jobs that will have medium- to long-term development impact
on the regions and the country.
These conflicting realities can be explained by a number of factors
prevalent in Armenia's economy. "Mining has been growing as a share of
the Armenian economy for several years now but with the economic crisis
and increase in world metal prices, mining took on a more significant
role in our GDP growth," he explained, noting that this trend is
expected to continue if no other sector of the economy picks up steam.
An increase in poverty is another observed effect of mining, a
relationship that, Grigoryan said, needs to be studied further. Other
research on the impact of mining conducted by the AUA School of Public
Health and AUA ACE reports some residents claiming that property
owners are forced to sell their properties at very low prices. Such
occurrences, if they have taken place, would deprive villagers of an
asset critical to wealth creation, according to Grigoryan.
Moreover, workers in the mining or mineral processing industries are
not provided health insurance, a fact that may burden families with
health costs or lower productivity.
The role of policy
"If we are to make mining a key sector in the Armenian economy,
we also have to develop the right socio-economic policies where the
immediate communities and the country benefits maximally," said Alen
Amirkhanian, the director of the AUA Acopian Center.
Mining and extractive industries have played a significant role
in ensuring long-term and equitable growth for several countries,
particularly Norway, Australia, and Botswana. "These countries have
successfully used mining to raise the standard of living for a vast
majority of their populations because they devised and implemented good
public policy," stressed Amirkhanian, who organized an international
conference last November on the topic.
Without proper policies designed to regulate and leverage mining,
Armenia will continue on a path that follows mining models that enrich
a few while depriving larger numbers of current and future generations
of opportunities to benefit from their patrimony, said Amirkhanian.
According to the Armenian Statistical Service, in 2011, Armenia's
mining industry employed 15,500 workers, or about 1 percent, of the
country's total employment and contributed to about 3 percent of
its GDP.
AUA is organizing another international scientific conference
on"Emerging Issues in Environmental and Occupational Health." The
conference, set for April 22-23, will bring leading experts from around
the world to Yerevan to explore the impact of mining and construction
in transition economies such as Armenia. The research they present
will provide solutions to the occupational and environmental health
problems facing workers, communities, and children, and help craft
public policy to address these issues.
The AUA Acopian Center for the Environment is a research center of the
American University of Armenia (AUA). AUA ACE promotes the protection
and restoration of the natural environment through research, education,
and community outreach. AUA ACE's focus areas include sustainable
natural resource management, biodiversity and conservation, greening
the built environment, clean energy and energy efficiency, as well
as information technology and the environment.
The College of Business and Economics (CBE) at AUA is the leading
business school in the region, promoting entrepreneurship, innovation
and ethical leadership. CBE has catered to Armenian and international
students, corporations, and communities for the past 20 years.
http://www.armenianweekly.com/2013/04/16/aua-study-mining-in-armenia-creates-poverty-income-inequality/
From: Emil Lazarian | Ararat NewsPress