“Everyone should abide by the formula: “Any single citizen can have a say on the future of the Republic of Armenia and the Republic of Artsakh, and I am one of them” – PM delivers concluding remarks during 2020 State budget debate in National Assembly
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Honorable National Assembly Speaker,
Distinguished Members of Parliament,
Dear government representatives,
We are concluding the discussions on the 2020 budget bill of the Republic of Armenia. I would like to thank you for interesting debate and say that it came to reaffirm my view that the 2020 State budget is a revolutionary one.
Since tomorrow is December 7 - the anniversary of the disastrous earthquake of 1988 - I would like to say that the 2020 budget bill is revolutionary for the disaster zone as well, because next year’s budget provides for an unprecedented amount - 3 billion drams - to address the disaster zone problems. Never before have we had such a high figure, even close to it. With that in mind, I would like to state that we are going to comply with the social commitments assumed by the State. This means that a new phase in the disaster recovery process is underway, and it should be done in a completely different way. And the meaning of this stage is to transform the logic of social emergency into the logic of development.
We must talk not only about solving urgent social problems in the disaster zone, but also about implementing long-term development visions and strategies. And as the most visible indicator of this problem, I want to formulate an imperative: the city of Gyumri should get rid of temporary shelters.
As I said during the Question and Answer session, we have registered all make-shift temporary shelters, and there will be an individual approach to each of them. It is the number one impediment to developing Gyumri’s potential as an economically and urban-developed city. Thus, a new era is actually being ushered in ever since 1988 in terms of addressing the earthquake’s aftermath.
You know, as a result of discussions, there are one or two episodes that have been voiced that I want to touch upon. There has been a lot of talk of about the funds earmarked for defense purposes. While we cannot elaborate too much on this topic, nevertheless I would like to say that we have boosted the defense budget by 66 billion drams as compared to 2018, which makes about a 28 percent increase. Please note and rest assured that the Republic of Armenia has acquired an unprecedented amount of ammunition and armaments as compared to the same period.
The Government of the Republic of Armenia will strictly adhere to the policy of restoring the military balance in the region. I want to say that serious steps are being taken to that end.
Now, let us see what is going on in the Republic of Armenia in economic terms. We had a growth of 7.5% in the first 9 months of this year. This is an absolute leading indicator in our region, in the region of the Eurasian Economic Union, in the post-Soviet region. At the same time, industry has grown by 8.8% as it comes to mining, I would like to stress that in the meantime processing industry grew by 9.3%, construction - 4.5%, services – 15.1%; trade turnover - 8.9%, exports – 7.2 %. Wages have been increased by 5.9 percent.
Against this background, I would like to state that the Republic of Armenia has one of the lowest inflation rates in the world today. The World Food Organization reports that food prices have risen by about 6 percent worldwide, while food prices proved only 0.1 percent up in Armenia.
What does the government have to do with all this? The connection is very straightforward. In terms of overcoming monopolies today, we manage to keep inflation at an unprecedentedly stable and unprecedentedly low level. There very few countries where there was a deflation this September as compared to last December. I would like to point out that these are not just good indicators; these are very good indicators that are simply ignored by our opponents who instead seem to be enthusiastic about the officially stated declines.
As it was stated here, Armenia’s foreign currency reserves were at a historic high as of this October. They rose by USD 386 million or 19 percent as compared to the same month last year. By the way, this is not just statistics, it is cash money, and you can set up a commission to check it up.
Next, the Central Bank of Armenia boasts another unprecedented figure. This year USD 521 million was purchased in Armenia. This is a direct evidence of the above-stated economic indices, since 521 million dollars were converted into drams in Armenia.
What did that money do? If people were to save money, they would have kept it in dollars under a pillow. Those 521 million dollars were spent, used, circulated in Armenia. Has it not had any economic impact? If so, how come the State budget was over-fulfilled by 89 billion drams?
Today the Government is settling its long-standing debt to the business community that accumulated over the past 30 years due to the failure to refund the prepaid VAT amounts. We have allocated 56 billion drams to repay the so-called bad debt. We tell the businessman who did not even hope of having his money back: “Brother, you may need the money that the Government owes you. We want to repay the debt we have inherited from the former governments.” This is not a matter of statistics: it is real money that goes to specific people.
330 km-long roads have been asphalted: will it not have an economic impact? Let people involved in construction industry say that today they are all overloaded with work. When you hint that there might be a new order, a new tender, they get confused as they just do not know what to do with the standing orders.
I also want to talk about so-called negative indicators, particularly in the agricultural sector. In the agricultural sector, yes, we do have a significant decline in statistics, but we need to understand the extent to which the decline is related, for example, to previously recorded counterfeits and exports. You may know that brandy used to be imported from abroad under the cover of grape procurements. Tomatoes used to be imported from Turkey or elsewhere, which were marketed as domestic products. We did away with that vicious scheme.
After all, what do we have in agriculture? We have a tangible increase in agricultural exports. The export of ready-made food has grown by 14.9%, while that of vegetables – by 15.2 percent. And we did it right, since the domestic economy has started to work. The export of cucumbers has increased by 489% this year. This is a clear evidence of economic recovery.
There was also some talk about foreign investments. In fact, foreign investment totaled USD 2.2 billion, 27% up against last year, while foreign direct investment amounted to USD 456 million, up 18 percent. Now, let us see whether we should be satisfied or dissatisfied with this figure. No, that is not enough, indeed, but there is a process associated with this.
Why is the foreign investor supposed to come to Armenia? Foreign investors first look at Moody’s ratings, Fitch’s ratings, Eurobonds ratings. Armenia’s rating is on rise in all these directions. Foreign investors closely follow the developments and react accordingly.
We have recorded a revolutionary increase in budget receipts: we had 353 billion drams in revenue as compared to 2018, 353 billion drams in 1.5 years. We are not happy with that either. But there is some logic: we are climbing a ladder that has 100 steps; we have to go 1, 2, 3, 4, and so on. Well, we can jump two, four or six steps, now we are jumping four. Our opponents tell us to jump twelve instead of four at once, which is impossible. No one can do that. Though, to be honest, we liked your hint. Give us that shit, and we will definitely succeed.
These figures speak of one very important thing: the ideology we laid in the background of Armenia’s economic strategy is working. Do you remember us talking about individual effort? As a matter of fact, the ideology of individual effort is working now.
Yes, today economic success is at the heart of that political ideology - inclusive economy that should be developed through individual effort. I am not stating these figures because I want to laud the Government of the Republic of Armenia: I am stating these figures to praise the citizen of Armenia, since they came to believe in their individual effort and responded to our call. They assumed responsibility for our country’s economic status. They believed in the government, which said that they had not come to sit in these cabinets and get rich; we came to help the citizens of the Republic of Armenia get richer. They responded to our motto: “Get rich and enrich others,” realizing that poverty can only be overcome through hard work and labor.
I would like to thank all the citizens who started economic activity in 2019, all the citizens who laid the stone on the stone, all the citizens who issued a cash-register receipt and those who asked for a cash-register check, all citizens who filed an invoice and demanded an invoice.
The topic of CCMs was very much discussed at the outset of that new stage, and it came to be perceived by the public to some extent, but now I want to focus on invoices, since the bulk of trade turnover goes through them.
I urge everyone to refrain from the practice of working without invoices, because I want to say again that those who cheat the State are actually stealing from a soldier who stands at the border today, risking his life, defending us all in this courtroom, because if they had not been there, power, opposition to power and criticism would have been useless. Therefore, do not steal from our soldiers.
And I reserve the right to say this because I think everyone knows we are not stealing from the State budget, I am not stealing any money. And on the contrary, yes, I say, we will cut off any hand that will attempt to take anything from our national wealth, our soldiers, our pensioners, and our teachers.
Back to the question of teachers, I want to state some facts. Criminal abuses have been detected in 126 schools, where 222 people had been on the pay-roll but did not go to work. The State budget thereby incurred a loss of about 350 million drams. We were told that the 10 percent rise in teachers’ wages was not enough. But fancy that we have also raised the salaries of those thieves; is that little or not? It appears that the increase in the salaries of thieves was too much.
We need to eradicate all these phenomena so that the rise in wages could be clearly seen. Although it is very good at times, in particular, in the case of the military, there is a very specific, very tangible rise in salaries. There are tremendous changes underway in the army.
Our military commanders did not have a penny-worth budget. When a lamp burnt out or a tap was broken, the commanders did not have a penny to fix the problem and had to look for “crooked” ways to do such primitive expenditures.
Today, we provide money for unforeseen expenses on a monthly basis, and we do our best to keep the commanders focused on their primary tasks - combat readiness, security, and control of operational security.
Another revolution has taken place in the field of culture. The total funding of the following cultural groups has increased by 700 million AMD: National State Choir of Armenia, National Philharmonic Orchestra, State Symphonic Orchestra, Komitas National Quartet, National Jazz Orchestra of Armenia, National Chamber Music Center, Tagharan Folk Ensemble, Yerevan State Chamber Choir, Yerevan State Chamber Music Orchestra, and Chamber Choir.
This has led to the fact that the aforementioned entities are 100% funded from the State budget. What does this mean in practice? To be honest, I myself felt hurt when an oligarch opened a commercial facility; gave some sponsorship money to these collectives, which had to attend the opening of bistros, while the “benefactor” gave several interviews to say that bistros are the best thing mankind has ever invented? This budget bill is revolutionary as it has relieved our art workers of that humiliating liability.
Of course, this is an intermediate solution, because we also need to look at the international experience to find decent ways of financing alternative cultures. Because many of the world’s best orchestras, cultural groups are not funded by the State budget. But there is a group of friends, classical music, etc., who tackle this issue mediating specific mechanisms, for example, fundraising, etc.
Dear Colleagues, this is what I wanted to state about the 2020 State budget bill, but I would like to conclude my remarks with what I feel to be the most important.
Honorable National Assembly Speaker,
Dear National Assembly Members,
In fact, things stand right, and this is the most important news. All of this shows that the situation will go improving. I want to bring up a figure that is very symbolic and maybe of historical significance. In 2019, the Republic of Armenia overran our neighbor, our friend, our beloved Georgia in terms of GDP per capita. Of course, we wish Georgia and the Georgian people all the best and we hope that by deepening economic cooperation we will help each other build more competitive, stronger economies. But what matters most is that by the end of 2020, we will be ahead of Azerbaijan in terms of GDP per capita. Next year the Republic of Armenia will be leading the edge in the region for the first time in the last 10 years at least.
And this is the flag of the economic revolution. And the flag of this economic revolution is upheld by a free, dignified, proud, hardworking citizen of the Republic of Armenia. I would like to reiterate my message to the nation: Dear compatriots, it does not matter whether you believe in the authorities or not; it does not either matter whether you believe in opposition or not, what matters most is your trust in your own power, your capabilities, your talent, your civic stance, our homeland, and the individual efforts of each of us. Because we have proved the validity of the formula: “Any citizen can have a say on the future of the Republic of Armenia, and I am one of them.”
I urge the citizens of the Republic of Armenia and the Armenians in general to follow this formula in a more consistent way in 2020. I myself will abide by the formula: “Any single citizen can have a say on the future of the Republic of Armenia and the Republic of Artsakh, and I am one of them.” Thank you.