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RUSSIAN ECONOMY SLUMP TO CUT DOWN TRANSFERS TO ARMENIA - ECONOMISTS
11:24 * 14.10.14
The economic risks Armenia may face after joining the Eurasian Union
will be contingent upon the possible slowdown in Russia's economy,
which in turn will cut down the money transfers, according to a
parliament member responsible for economic issues.
Gagik Minasyan, the head of the National Assembly's Standing Committee
on Financial-Credit and Budgetary Affairs, says he finds such a
slowdown predictable against the backdrop of the globally observed
decline in the oil prices.
"Those countries, as a rule, have their own security cushion which
they pile up over the course of years to combat such challanges. From
that point of view, it applies to both Azerbaijan and Russia," he
told Tert.am
Analysts cite both economic and political developments as reasons
behind the observed decline, pointing out particularly to the
increasing export volumes from Saudi Arabia and the higher reliance
on domestic resources in the United States. Minasyan said he finds
that the observed trends fall within the logic of the global conflict
Ukraine faces today. "I don't rule out the possibility that we will
see the oil prices drop up to 80% until the Ukraine conflict is over,"
he noted.
As for the reduced transfers from Russia, he said it is an inevitable
aftermath of the economic slowdown. "The question has to do with
the transfer volumes. If they are too big, it can in a way affect
our effective demand, but the volumes largely depend on the economic
activity on the Russian market. If the conflict deepens, two scenarios
will be possible. Either Russia will wish to finance its economy
from domestic reserves to secure economic growth (and the transfers
will not essentially reduce in that case) or, if it isn't able to
implement that, the cutdown of transfers will be essential and will
affect our effective demand," he explained.
Addressing the problem, economist Vardan Bostanjyan agreed that the
reduced transfers and the new Dollar exchange rates may negatively
impact Armenia's economy. "I don't think we recorded considerable
success in the economy in 2014. So I forecast a sadder scenario
against the backdrop of these negative impacts too," he said.
But the economist added that he nonetheless expects the positive
outcome to be greater and more essential. "I am inclined to think that
those extremely important factors will be on a higher level than they
have been to date. And that in turn will have its positive impact in
terms of putting our economy on the right track and ensuring a real
development," he said.
Noting that all the oil trading organizations also have their functions
on the territory of Armenia, Bostanjyan said he thinks that the
positive factors will have their direct impact on the country.
"Naturally, the difficulties they may face will be automatically
projected on Armenia. But because Armenia is only partially reliant on
them, I don't want to think that the negative impact will be great,"
he added.
As for the risks of Eurasian integration, Bostanjyan said he doesn't
find that any other scenario could absolutely rule them out. He said
Armenia's economic risks are high even without the membership in the
Eurasian Economic Union (EEU). "We have great risks as it is, so our
integration into the EEU has to reduce them at least bit," he said.
Armenian News - Tert.am
From: A. Papazian
11:24 * 14.10.14
The economic risks Armenia may face after joining the Eurasian Union
will be contingent upon the possible slowdown in Russia's economy,
which in turn will cut down the money transfers, according to a
parliament member responsible for economic issues.
Gagik Minasyan, the head of the National Assembly's Standing Committee
on Financial-Credit and Budgetary Affairs, says he finds such a
slowdown predictable against the backdrop of the globally observed
decline in the oil prices.
"Those countries, as a rule, have their own security cushion which
they pile up over the course of years to combat such challanges. From
that point of view, it applies to both Azerbaijan and Russia," he
told Tert.am
Analysts cite both economic and political developments as reasons
behind the observed decline, pointing out particularly to the
increasing export volumes from Saudi Arabia and the higher reliance
on domestic resources in the United States. Minasyan said he finds
that the observed trends fall within the logic of the global conflict
Ukraine faces today. "I don't rule out the possibility that we will
see the oil prices drop up to 80% until the Ukraine conflict is over,"
he noted.
As for the reduced transfers from Russia, he said it is an inevitable
aftermath of the economic slowdown. "The question has to do with
the transfer volumes. If they are too big, it can in a way affect
our effective demand, but the volumes largely depend on the economic
activity on the Russian market. If the conflict deepens, two scenarios
will be possible. Either Russia will wish to finance its economy
from domestic reserves to secure economic growth (and the transfers
will not essentially reduce in that case) or, if it isn't able to
implement that, the cutdown of transfers will be essential and will
affect our effective demand," he explained.
Addressing the problem, economist Vardan Bostanjyan agreed that the
reduced transfers and the new Dollar exchange rates may negatively
impact Armenia's economy. "I don't think we recorded considerable
success in the economy in 2014. So I forecast a sadder scenario
against the backdrop of these negative impacts too," he said.
But the economist added that he nonetheless expects the positive
outcome to be greater and more essential. "I am inclined to think that
those extremely important factors will be on a higher level than they
have been to date. And that in turn will have its positive impact in
terms of putting our economy on the right track and ensuring a real
development," he said.
Noting that all the oil trading organizations also have their functions
on the territory of Armenia, Bostanjyan said he thinks that the
positive factors will have their direct impact on the country.
"Naturally, the difficulties they may face will be automatically
projected on Armenia. But because Armenia is only partially reliant on
them, I don't want to think that the negative impact will be great,"
he added.
As for the risks of Eurasian integration, Bostanjyan said he doesn't
find that any other scenario could absolutely rule them out. He said
Armenia's economic risks are high even without the membership in the
Eurasian Economic Union (EEU). "We have great risks as it is, so our
integration into the EEU has to reduce them at least bit," he said.
Armenian News - Tert.am
From: A. Papazian