In an interview with Tert.am, the head of the Economy Ministry’s Industry Policy Department elaborated on the economic impact of Armenia’s Eurasian integration.
Commenting on the possible advantages and disadvantages of the country’s membership in the Eurasian Economic Union (EEU) and the western powers’ sanctions against Russia, Armen Yeganyan said he believes that all future developments will depend on the kind of economic policies pursued.
The Central Bank has revised its forecasts in the industry sector, reducing particularly the expected growth in mining and metallurgy. What are the trends in this conection?
The Central Bank may have made its forecasts and analyses and envisioned the reduction trends, but I would like to elaborate on the statistics. Though it reflected a decline in the industry sector at the beginning of the year, those paces were reduced every other month. Back in June, we had a 1.5 percent industrial growth. And the growth for August too, will be higher I think, and the trend will be maintained.
Given that the EEU membership is an accomplished process, with the treaty expected to be signed on October 10, what reflection do you think it will have on Armenia’s economy? What negotiations have been conducted?
Negotiations were conducted in all directions, focusing, among other things, on the customs duties – including both tariff and non-tariff regulations.
What new opportunities does the EEU membership offer, given especially that many believe that we had those advantages before?
Making evaluations on a membership in an organization or union is logical after the that membership is an accomplished deal. A positive or negative result depends on the kind of policies that the sides involved will pursue. If a membership in a union or a relationship with another country enables us to pursue the right economic policies and have a positive result, we will have a positive outcome. If we do not mange that, the outcome will be negative.
But how do we know what is awaiting us and where we are going?
The groups which have worked in that direction naturally have their analyses, but those are only forecasts. A more realistic analysis is possible after the process in question comes to a close. The impact may be both positive and negative depending on the way we guide our policies. Our easier access to the market will be an opportunity, of course, though we have a free trade agreement with those countries, which is already an opportunity in a way.
Many believe that the sanctions against Russia help Armenia increase its export volumes. Are there noticeable results in this respect?
The sanctions were imposed not quite a long time ago, and they mainly apply to agricultural produce. But regardless of everything – whether they are sanctions enforced against or by Russia – it is possible to gain certain advantages. Export-oriented policies have to reflect an action plan aimed at the development of export. And episodes as this should never serve as basis for them.
So we have to think about guiding our policies in a way that would help develop the export regardless of the presence or absence of restrictions in Russia. Export-oriented policies have to be based on the development of export, without ever reflecting episodicactions. We must try to ensure high-quality competitive products that will be possible to export to not only the Russian but also other countries’ markets. If we guide our policies in that way and have “developed exports”, and if our products are recognizable, our export volumes will naturally increase, irrespective of restrictions on any market.
Europe is expanding the list of sanctions against Russia, and many experts believe that it will have a negative impact on Armenia’s economy. Do you think that threat exists?
Armenia is not isolated from the world, after all. We are in an everyday cooperation with different countries, so our economy can be said to be in a kind of dependence upon other countries’ economies. Once a problem emerges in any place, it may have its negative impact on our country. The same can be said about the 2008 global recession, whose wave naturally came to Armenia, producing its influence on our economy.
But when the crisis began, our authorities said it wouldn’t reflect on us; however we overcame it with great difficulty. Can the same scenario apply to the sanctions?
The statements about the recession were forecasts and professional evaluations, and one can always err while making a forecast. I haven’t heard for now that the sanctions will not affect us.
So do you confirm that it will have a negative impact on our economy?
What I say the negative consequences of any country’s economy may have their impact on us. All depends on how we can use the situation while implementing our economic policies. If we are able to use the situation the right way, we can suffer minimum or no negative impact.
Your evaluations are more of a general nature. If possible, say more specifically, what impact will the sanctions have on Armenia?
If I say today that there will have no impact at all, it will not be serious. Therefore, it is necessary to conduct profound professional studies to be able to assess the negative or positive result. But even the forecasts conducted based on those analyses are not expected to be 100 percent accurate. Any situational changes may cause those forecasts to lose their value.