The Draft Budget for 2019 Has Been Submitted To the National Assembly
14 November, 2018

At the sitting of the National Assembly the RA Government presents the draft State Budget.

Acting RA Minister of Economic Development and Investments Tigran Khachatryan said in his speech that the peculiarity of discussions about the State Budget for 2019 is that it is composed and presented by the examination of the expected outcomes of the program.

"Accordingly, it is important to answer to the question:to what short-term and long-term outcomes the economic policy is directed to," said Tigran Khachatryan.

According to the Acting Minister, in the coming years the main goal of the economic policy will be boosting welfare of Armenian citizens by increasing their participation possibilities in economic life. "A greater number of members of the society should be involved in economic life, and the economic value created should be distributed more equally between those creators."

The Acting Minister noted: "Low productivity is the main risk of the Armenian economy. There is no alternative to sharp rise in our economic competitiveness. The ability to improve the well-being of our population over the long term will depend almost entirely on our ability to raise the marginal productivity of labour. In the years following 2019, the economic policy should lead to at least 5% increase in annual GDP, while exports of goods and services should exceed 45% of GDP. And cumulative capital accumulation, which is the most important indicator from the point of view of increasing the potential for economic development, should reach 23-24% of GDP."

Speaking about the necessary preconditions for measuring investments and for their increase, Tigran Khachatryan said:

"All countries compete for investment attraction. The World Investment Report, published by the UN Conference on Trade and Development, states that most of foreign investments still flows to developed countries. Only a small part of the flow of foreign investments comes to small economies. What are the factors that each investor evaluates before making investment decisions? Economic and political stability, clear regulatory mechanisms that do not allow ambiguity or discretionary enforcement, exclusion of corruption, quality infrastructure, human capital development, and expansion of markets."

"If we expect the current investments to GDP ratio of 18% to reach 25% in 4-5 years, we should definitely focus on the positioning in the markets. We have privileged trade terms with the EAEU, the US and the EU; there are arrangements with neighbouring Iran to develop economic relations with preferential trade regime. But these are just prerequisites for promoting a significant increase in the export of goods and services in the coming years. If we do not pay attention to the rest of the weaker points, these will still be just opportunities. Consequently, on the microeconomic level, our goal should be to identify those weak points, problems of logistics, physical infrastructure, and quality regulations. If we talk about the State Budget for 2019, they are short-term, one-year actions. I think we will have the opportunity and responsibility to discuss all the correctly addressed solutions of the above-mentioned weak points," said the Acting Minister for Economic Development and Investments.