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A Hostage of Wise Man Or A Friend of Oligarchs?
HAKOB BADALYAN
17:30 01/03/2013
Story from Lragir.am News:
http://www.lragir.am/index.php/eng/0/comments/view/29145
The Armenian adventures of Carrefour get a lot of attention. There are
not only expectations but also objections. For example, a lot of
people ask what the difference is whether a local retailer or a
foreign retailer will cause closure of small and medium businesses. A
lot of people ask what Carrefour will bring to Armenia as there is a
widely spread network of supermarkets in Armenia.
The questions seem to be relevant unless the economic and political
situation of Armenia is observed more deeply.
Currently, the local oligarchs cover the wholesale and retail markets.
They also cover the government, and their principle is `nothing will
stop us'.
A big player is needed for this game who will be able to set other
rules and resist the oligarchs playing in accordance with other rules.
Carrefour is a big player which will bring competitiveness, and the
foothold of the oligarchs may be shattered a little. Whether the
state, the society and the government will benefit from it later and
will enable development of competition is already another issue.
It is ingenuous to think that Carrefour will resolve the systemic
issues of the Armenian economy. And there is no need to think that
those who welcome Carrefour to Armenia do it out of ingenuousness.
The same goes for the culture of supermarkets. The network that is in
place needs improvement which will be enabled by the arrival of this
international brand. It is not a secret that most supermarkets use
deception techniques. They cheat in price, weight, dates of expiry,
cash bills. And again nothing can stop them.
The problem of Carrefour has a political aspect as well. The Armenian
economy has been usurped by the criminal and oligarchic system. The
economy is divided to quotas allocated to oligarch officials or
members of parliament or their friends. There are two ways of
dismantling the system, either by means of instant nationalization
which will hardly have any political or economic benefits or systemic
change, real action not imitation, fully in accordance with the law.
Hypothetically, leaving aside practical and personal subjective
reasons of the government, systemic change will trigger blackmail and
sabotage by the criminal oligarchy because the oligarchs are unwilling
to give away their monopoly and oligopoly, power and privileges.
If an oligarch manipulates the price of sugar for a few hours, the
country will plunge into a military panic. One can imagine what will
happen in case of manipulations lasting for several days or several
weeks, especially with other products and services.
The state has two tools to kill the viability and diminish the effect
of blackmail. First, the punitive-law-enforcement-legal tool when
oligarchs are arrested for breaking the law. However, this tool will
not be effective as long as government and business are one.
Hence, the second tool must be used which is increase of the
`extra-criminal-oligarchic' capital in the country. It would be
desirable to do it by means of development and multiplication of small
and medium businesses but since power is with the oligarchy, it will
easily suppress the efforts of building up SMEs in the economy.
Hence, in conventional terms alternative economy or alternative
capital must be formed with the involvement of international companies
whose potential is often equal and sometimes bigger than that of
states. Trade, services and manufacturing must be covered equally
well.
There is danger that the state, the society may appear under the
influence of big companies. However, is there anyone who thinks that
Armenia that is ridden by oligarchs is less subject to foreign
influence? Second, to achieve success, Armenia must communicate with
and be integrated with the global world. The Armenian saying is, `It's
better to be a wise man's hostage than a fool's friend.' Of course, no
saying is absolute truth but there is no need to be afraid. It is
necessary to benefit from this situation to get out of the bog and to
develop.
HAKOB BADALYAN
17:30 01/03/2013
Story from Lragir.am News:
http://www.lragir.am/index.php/eng/0/comments/view/29145
The Armenian adventures of Carrefour get a lot of attention. There are
not only expectations but also objections. For example, a lot of
people ask what the difference is whether a local retailer or a
foreign retailer will cause closure of small and medium businesses. A
lot of people ask what Carrefour will bring to Armenia as there is a
widely spread network of supermarkets in Armenia.
The questions seem to be relevant unless the economic and political
situation of Armenia is observed more deeply.
Currently, the local oligarchs cover the wholesale and retail markets.
They also cover the government, and their principle is `nothing will
stop us'.
A big player is needed for this game who will be able to set other
rules and resist the oligarchs playing in accordance with other rules.
Carrefour is a big player which will bring competitiveness, and the
foothold of the oligarchs may be shattered a little. Whether the
state, the society and the government will benefit from it later and
will enable development of competition is already another issue.
It is ingenuous to think that Carrefour will resolve the systemic
issues of the Armenian economy. And there is no need to think that
those who welcome Carrefour to Armenia do it out of ingenuousness.
The same goes for the culture of supermarkets. The network that is in
place needs improvement which will be enabled by the arrival of this
international brand. It is not a secret that most supermarkets use
deception techniques. They cheat in price, weight, dates of expiry,
cash bills. And again nothing can stop them.
The problem of Carrefour has a political aspect as well. The Armenian
economy has been usurped by the criminal and oligarchic system. The
economy is divided to quotas allocated to oligarch officials or
members of parliament or their friends. There are two ways of
dismantling the system, either by means of instant nationalization
which will hardly have any political or economic benefits or systemic
change, real action not imitation, fully in accordance with the law.
Hypothetically, leaving aside practical and personal subjective
reasons of the government, systemic change will trigger blackmail and
sabotage by the criminal oligarchy because the oligarchs are unwilling
to give away their monopoly and oligopoly, power and privileges.
If an oligarch manipulates the price of sugar for a few hours, the
country will plunge into a military panic. One can imagine what will
happen in case of manipulations lasting for several days or several
weeks, especially with other products and services.
The state has two tools to kill the viability and diminish the effect
of blackmail. First, the punitive-law-enforcement-legal tool when
oligarchs are arrested for breaking the law. However, this tool will
not be effective as long as government and business are one.
Hence, the second tool must be used which is increase of the
`extra-criminal-oligarchic' capital in the country. It would be
desirable to do it by means of development and multiplication of small
and medium businesses but since power is with the oligarchy, it will
easily suppress the efforts of building up SMEs in the economy.
Hence, in conventional terms alternative economy or alternative
capital must be formed with the involvement of international companies
whose potential is often equal and sometimes bigger than that of
states. Trade, services and manufacturing must be covered equally
well.
There is danger that the state, the society may appear under the
influence of big companies. However, is there anyone who thinks that
Armenia that is ridden by oligarchs is less subject to foreign
influence? Second, to achieve success, Armenia must communicate with
and be integrated with the global world. The Armenian saying is, `It's
better to be a wise man's hostage than a fool's friend.' Of course, no
saying is absolute truth but there is no need to be afraid. It is
necessary to benefit from this situation to get out of the bog and to
develop.