Government approves comprehensive action plan to counter coronavirus impact and offset its economic consequences
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A Cabinet meeting was held today, chaired by Prime Minister Nikol Pashinyan.
In order to prevent the spread of the novel coronavirus, like many other countries, Armenia has restricted, or in some cases, even suspended the activities of a number of business entities. To provide maximum support to businesses and citizens in the current situation, the Government today approved a comprehensive action plan to counter the adverse coronavirus impact and 5 measures to offset its economic consequences. The program is specifically aimed at addressing the liquidity-related risks for individual business entities, promoting sustainable economic development, identifying and assisting those people who have lost their jobs due to the virus, ensuring the safety of vulnerable groups and supporting their families, modernizing Armenia’s healthcare system, providing efficient management of stocks of food, medical supplies, raw materials and other products.
Nikol Pashinyan stated in this connection: “The program not only seeks to support the competitive sectors and those social layers that suffered the first, but it has an ultimate goal of getting our society and citizens to build a competitive economy in the post-crisis period. We should in no way forget this agenda or the ensuing development scenario. We will have to shift from the logic of survival to the logic of development, strengthening and increasing the country’s overall competitiveness. This is the most important premise that underpins the program.”
The Prime Minister touched on the non-provision of cash receipts and noted: “With the recent increase in retail sales, we have clear indications that the practice of not providing cash receipts is back as many think that cash receipts would be paid less attention amid the ongoing crisis. On the contrary, there is a crisis now, and, yes, more attention needs to be paid to it.
I expect that the State Revenue Committee will tighten measures, considering that many enterprises are not working and even many shops are closed at this point of time, and there are fewer facilities to inspect. I expect that the State Revenue Committee will identify and punish the offenders as there is no excuse for this, especially today, when the retail turnover has increased significantly.
Mediating retrospective analysis we should expose all unscrupulous entities and impose appropriate sanctions. In general, we should not allow the past bad habits to resume during a crisis, especially in the field of tax discipline. Such irregularities should be ruled out and rooted out ahead. In a situation when entities work according to a different logic and in a different mode, the State Revenue Committee should be twice, three times as stricter with regard to tax evasion.”
The proposed first measure consists in assisting individual economic entities in the form of co-financing, refinancing and subsidizing interest rates. Only one type of assistance is available for each business entity. This will help them adapt to the changing market demand and new economic conditions, as well as to adjust and update their development strategies.
The second action suggests establishing a zero interest rate for loans in order to boost the farming sector’s potential through modern irrigation systems, hail-proof networks, intensive orchards, smart farms for high-blood animal husbandry, as well as for the lease of farm machinery and equipment.
The Premier emphasized that this program is currently the most obvious instance when the crisis is viewed as an opportunity. Prime Minister Pashinyan considered the program a historic opportunity to make a breakthrough the field of agriculture.
The third measure seeks to support those entities that posted an annual turnover of 24-500 million drams in 2019 in the form of credit insurance and interest rate subsidies.
The fourth measure offers assistance to such families with minor children under 14 as may be facing welfare bottlenecks due to the shrinking labor market.
The fifth activity is meant to help businesses preserve their effective jobs and continue operations. The program will target those entities that had from 2 to 50 full-time workers and a stable payroll in the period from 01/01/2020 to 01/01/2020/. A lump-sum grant will be provided under the program.