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“Subvention programs should be at the heart of our territorial development strategy” – PM holds consultation to discuss regional development issues


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Chaired by Prime Minister Nikol Pashinyan, a consultative meeting was held in the Office of Government with the participation of Marz Governors to discuss current problems and 2020 activities.

Addressing the meeting, Prime Minister Pashinyan noted that 2020 is the right time to address more targeted issues of territorial development. “To my mind, we rather identified than found out the formula we should use in implementing territorial development. Based on the results of 2018-2019, we can say that the system of subventions should become the main driving force behind development.

The subvention system is attractive because it actually provides a specific framework of cooperation, since in fact both the government and communities are involved in those programs. That is, communities take a stake by contributing with their own funds, which gives citizens an opportunity to see where taxes go, and how life is being improved.

Today I was told that subvention programs totaling 16 billion drams have been implemented in the provinces, while communities have not yet been able to spend 10 billion drams. As I have stated on several occasions, we need to abide by the following principle: as soon as communities will have invested said 10 billion drams, the amount of budget allocations will increase say by 1 billion, or 2 billion drams - as much as our communities can materialize.

What conclusion have we reached during this time? Our conclusion seems unambiguous that subventional programs are most successfully implemented by enlarged communities, where there is a certain concentration of funds, and here we are talking about volumes and quality. I myself have visited several communities to get acquainted with the progress in the subvention programs.

These programs are also supposed to show citizens the impact of their votes given in local elections in terms of living standards as unfortunately, the causal link is sometimes not clearly perceived by our citizens. This system, in both economic and political sense, will give us the opportunity to have a new level of dialogue with our citizens in terms of the quality of local government performance.

This year, we have introduced another key component: third parties have the opportunity to participate in subvention programs as well. I mean the private sector, philanthropists, people who want to participate in the development of their communities. A fundamental philosophical change is taking place here: many entrepreneurs and philanthropists are working to implement some kind of programs in their native communities. In this case, when three actors - private sector, government and community - manage to invest, we can move from the so-called purely charitable logic to the logic of development.

Therefore, subvention programs should be at the heart of our territorial development strategy, and we must ensure that the government-private sector-co-funded programs are as targeted as possible, I mean in terms of funds, so that the implementation of those funds will lead us to more visible, tangible results. Today we will also discuss the problems faced at the implementation stage and will try to find solutions to these issues.”

Minister of Territorial Administration and Infrastructure Suren Papikyan presented the results of subvention programs: last year in the marzes of the republic in the course of cooperation between the state and community subvention programs worth 16 billion 378 million drams were implemented, of which state co-financing makes up 9 billion 597 million drams.

“In 2019, we transferred 6, 366 million drams on the basis of performance, as well as taking into account the quality standard. We did not transfer the rest to the communities, we gave them an opportunity to correct the mistakes in 2020, and if proper work is done, the rest will be transferred. This is a crucial message to performers and contractors who need to realize that quality standards are of paramount importance. That is, we must comply with the standards required by the state, and contractors will have to honor their contractual commitments,” the minister said.

The Minister stressed that quality is the key issue. According to Mr. Papikyan, this year’s cooperation program with the UN Development Program envisages introduction of energy-saving systems in the regions worth about USD 9 million, which implies repairs, strengthening of roofs and basements, as well as exterior and interior improvements.

The Prime Minister said that both subventions and development programs should have a civilization-oriented component and be based on the logic of development thinking, namely: not only the creation or improvement of a particular infrastructure, but also the formation of a favorable atmosphere and environment. Nikol Pashinyan instructed the governors to be consistent on this issue.

The meeting also discussed issues related to the formation of the necessary environment for attracting investments in the regions, carried out in various directions of reforms, and the possibilities of infrastructure programs.

During the meeting, reference was made to the problem of slaughterhouses. Issues of cooperation between regional administrations and government departments were discussed.

Prime Minister Pashinyan noted the importance of doing coordinated work, stressing the need to move from strategic management to strategic decisions, and the tasks for 2020 should stem from this very logic.

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