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Head Of The Union Of Local Manufacturers Of Armenia: Armenia Should Shift To A New Policy Of Economic Mobilization
by Samvel Sarksyan
Friday, July 12, 12:44
Armenia should shift to a new policy of economic mobilization, Vazgen
Safaryan, Head of the Union of Local Manufacturers of Armenia, told
media, Thursday.
He said that to shift to the given policy it is necessary to establish
a new investment and development bank, separate tourism and industry
from the Economy Ministry and create relevant ministries, as well as
give these ministries and the ministries of agriculture, energy and
natural resources a status of economic- functional departments instead
of the current status of functional departments. Safaryan believes
that such change of the status will allow better managing the given
sectors through cooperation of the government and the private sector.
Safaryan thinks that another element of the new economic policy of
Armenia should be improvement of the copper processing line. At
present, Armenia exports copper concentrate with 26%-28% copper
content, in the meanwhile, downstream processing allows recovering
blister copper and refined copper with a 99.9% copper content. In
addition, he said, in cooperation with the private sector it is
necessary to build a copper mill and a chemical and metallurgical
combine in the Syunik region. These enterprises will operate on over
1.5 bln tons of waste accumulated in the tailing storage facilities.
According to Safaryan's forecasts, in case of annual processing of 50
mln tons of waste, the profits will total $1.4 bln and the GDP will
be increased by $10 bln drams. It is possible to extract 106,000
tons of refined copper, 3.6 tons of gold, 142 tons of silver, 176
tons of tellurium, 70 tons of selenium, 220,000 tons of free sulphur,
and 5.6 mln tons of iron from the tailing storage facilities. Safaryan
thinks that downstream processing will allow developing the ferrous and
non-ferrous metal industry. Up to 1 mln tons of iron was used in the
Soviet Armenia. Processing of the tailing dumps will allow creating
15,000 jobs at the average monthly salary of $700 and improving the
environmental balance in the region.
He said that local production of leather and wool and the related
sectors also need a new approach. For instance, one of the local
carpet producer companies is ready to start processing of over 4,000
tons of wool accumulated in the country - up to 1,000 tons of wool
is accumulated in the country every year. Reactivation of the local
leather manufacturing enterprises will allow creating 3,000 jobs at
the shoe factories.
To raise funds from the citizens of Armenia, the Diaspora Armenians,
and foreign investors in such nation- wide projects, he said, it
is necessary to start issue of debt securities. In addition, the
government should take up the shares of the privatized enterprises with
foreign capital. The government should also participate in imports of
goods, which reached $4.2 bln drams in 2012. If the government's share
in imports makes up 30%-40%, it will become possible to transform
that commercial capital into investment capital sufficient for
economic development.
"Our internal capital resources are sufficient to modernize economy
without raising foreign funds," Safaryan said.
He believes that to achieve economic efficiency Armenia needs to reduce
the fiscal burden by 35%-40%. This will allow increasing the taxpayers
base. For conclusion, he said that the aforementioned measures should
pave the way for uneven development of economy, as the average annual
growth of GDP by 6.3% (400 bln drams) of the last several years is
insufficient for significant increase of salaries and pensions -
the spending capacity of the population.
In response to a question from ArmInfo as to whether it is possible to
conduct a mobilization economic policy in the current system of the
state governance, Safaryan said that to become a senior executive in
the Soviet period one was to progress up the career ladder, but now
'a man in the street can be appointed a minister' and this situation
should be corrected as well.
http://www.arminfo.am/index.cfm?objectid=4E77F370-EACF-11E2-A47E0EB7C0D21663
by Samvel Sarksyan
Friday, July 12, 12:44
Armenia should shift to a new policy of economic mobilization, Vazgen
Safaryan, Head of the Union of Local Manufacturers of Armenia, told
media, Thursday.
He said that to shift to the given policy it is necessary to establish
a new investment and development bank, separate tourism and industry
from the Economy Ministry and create relevant ministries, as well as
give these ministries and the ministries of agriculture, energy and
natural resources a status of economic- functional departments instead
of the current status of functional departments. Safaryan believes
that such change of the status will allow better managing the given
sectors through cooperation of the government and the private sector.
Safaryan thinks that another element of the new economic policy of
Armenia should be improvement of the copper processing line. At
present, Armenia exports copper concentrate with 26%-28% copper
content, in the meanwhile, downstream processing allows recovering
blister copper and refined copper with a 99.9% copper content. In
addition, he said, in cooperation with the private sector it is
necessary to build a copper mill and a chemical and metallurgical
combine in the Syunik region. These enterprises will operate on over
1.5 bln tons of waste accumulated in the tailing storage facilities.
According to Safaryan's forecasts, in case of annual processing of 50
mln tons of waste, the profits will total $1.4 bln and the GDP will
be increased by $10 bln drams. It is possible to extract 106,000
tons of refined copper, 3.6 tons of gold, 142 tons of silver, 176
tons of tellurium, 70 tons of selenium, 220,000 tons of free sulphur,
and 5.6 mln tons of iron from the tailing storage facilities. Safaryan
thinks that downstream processing will allow developing the ferrous and
non-ferrous metal industry. Up to 1 mln tons of iron was used in the
Soviet Armenia. Processing of the tailing dumps will allow creating
15,000 jobs at the average monthly salary of $700 and improving the
environmental balance in the region.
He said that local production of leather and wool and the related
sectors also need a new approach. For instance, one of the local
carpet producer companies is ready to start processing of over 4,000
tons of wool accumulated in the country - up to 1,000 tons of wool
is accumulated in the country every year. Reactivation of the local
leather manufacturing enterprises will allow creating 3,000 jobs at
the shoe factories.
To raise funds from the citizens of Armenia, the Diaspora Armenians,
and foreign investors in such nation- wide projects, he said, it
is necessary to start issue of debt securities. In addition, the
government should take up the shares of the privatized enterprises with
foreign capital. The government should also participate in imports of
goods, which reached $4.2 bln drams in 2012. If the government's share
in imports makes up 30%-40%, it will become possible to transform
that commercial capital into investment capital sufficient for
economic development.
"Our internal capital resources are sufficient to modernize economy
without raising foreign funds," Safaryan said.
He believes that to achieve economic efficiency Armenia needs to reduce
the fiscal burden by 35%-40%. This will allow increasing the taxpayers
base. For conclusion, he said that the aforementioned measures should
pave the way for uneven development of economy, as the average annual
growth of GDP by 6.3% (400 bln drams) of the last several years is
insufficient for significant increase of salaries and pensions -
the spending capacity of the population.
In response to a question from ArmInfo as to whether it is possible to
conduct a mobilization economic policy in the current system of the
state governance, Safaryan said that to become a senior executive in
the Soviet period one was to progress up the career ladder, but now
'a man in the street can be appointed a minister' and this situation
should be corrected as well.
http://www.arminfo.am/index.cfm?objectid=4E77F370-EACF-11E2-A47E0EB7C0D21663