12, 2015

Remarks by President Serzh Sargsyan at the New Year reception for the representatives of the business community

Dear representatives of the business community,

I cordially welcome you to the Presidential Palace. We traditionally meet at the end of the year to wrap up the passing year and to wish you success in all your future endeavors.

First of all, let us speak briefly about where we stand now. Through the last decades, the Armenian authorities have always stood out for their economic discipline. With this regard, we compare favorably with many-many others because we stood clear of adventurism and irresponsible steps. Moreover, Armenia has always been noticeable for her stable macroeconomic indicators. For that very reason, international financial institutions have always viewed Armenia as an unwavering and reliable partner.

In 2015, global economic developments have been marked with multiple negative tendencies. Throughout this year, prices for raw materials, including oil and metals, have been dropping, in the global capital markets and especially in the Asian region there took place short-term shocks, currencies of the developing countries have been depreciating against the US dollar which brought about high inflation, while in a number of countries local currencies have registered spasmodic adjustment resulting in panic on the internal financial markets. This was coupled with the escalation of the geopolitical conflicts and continuous manifestations of the “war of economic sanctions”.

Quite obviously, given the mentioned above developments in the world, it was not easy to provide for macroeconomic stability, maintain low inflation and relatively steady national currency as well as to register economic growth. Nevertheless, actual numbers of economic tendencies for eleven months of year 2015 show that thanks to the undertaken efforts, it became possible to keep the economic environment of our country more or less free of considerable shocks caused by the negative impulses coming from without. Thus, the indicator of economic activity for January-November 2015 was 2.9% when at the beginning of the year the experts were anticipating zero, and in some cases even negative indicators of the economic growth. The growth has been registered in the area of industry - 4.6%, in agriculture – 11.6%, in the area of services, without trade, of course, - 3.0%. Inflation for twelve months, i.e. prices in November compared to the same month of the last year, was 1.9%, while the average inflation was 4.1%. Average wages were increased by 8.5%: This is a unique situation when salaries in the state sector grew faster than salaries in the private sector - while there was an increase in salaries for 8.5%, in the state sector wages grew for 9.7%. It should be mentioned that these developments were accompanied by a relative stability at the currency market: medium monthly exchange rate of dram against the US dollar in December compared to December of the previous year depreciated by 4.4%. It is important to note that such behavior of the exchange rate has been compatible with the behavior of the economic basics and those responsible for macroeconomic indicators through their balanced approach have been able to avoid artificial exchange rates which would mean a risk of steep adjustment.

That’s what we are having today. No doubt, many countries would be happy to have indicators like these, however our absolute numbers are not high, which means we cannot be complacent with the current numbers. Armenia needs a greater, long-term and stable growth which will be immune against the negative impulses from without. This is the only way to get and occupy our worthy place in the global economy.

This year we have continued the policy of active reformation which was not lost on international structures. According to the Doing Business index of the World Bank, Armenia has moved three points up among 189 countries and now occupies the 35 place. This year Armenia was included on the list of the countries, which implemented three or more reforms, and such countries make only 14% of the economies where such analysis was conducted.

Armenia has registered progress also in the UN Human Development Index as well as in the Global Competitiveness Report of the World Economic Forum.

I believe that in the framework of the current economic policy, the most significant work has been done in export promotion. Good foundation has already been laid for this, and the results have already become noticeable. Next year, we will continue to work on this direction steadfastly.

The Government, of course, is not directly responsible for the efficiency of private companies; however it can and must create preconditions for improvement. There are still things to be done in this area, and we will be working with great precision. Mining, food production in its widest sense, including the entire agriculture, also tourism, information technologies, export of health care and educational programs - this is the incomplete list of the areas to which both the authorities and our business community should spare no effort to bring new ideas and implement new programs. We have created new opportunities to move forward, and together we have to utilize these opportunities to the fullest extent.

Dear Entrepreneurs,

I cordially congratulate you on the occasion of New Year and Holly Christmas.

I wish love and harmony to your families, and I wish you success in your undertakings. I have no doubt that you are able of carrying out and moving ahead with the most daring projects.

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