Hayots Ashkharh: Investment Policy is in Ruins

“Hayots Ashkharh” newspaper writes: Investment policy is in ruins.
“No matter how much effort is made to create the impression among the public that after the change of power, foreign investors are seriously interested in the economy of Armenia, the fact is that the government has jeopardized the investment policy and has greatly impacted the country’s already low investment attractiveness with its unfounded actions.

We are not talking about promises of ensuring an investment boom. It was clear from the very beginning that this would not happen. Everything was done to attract unaware groups of society. It did not take long to be convinced of that. Seven to eight months have passed since the change of power, yet the investment statistics continue to record worrying figures.

Thus, during the first nine months of this year, net inflows of direct investments in Armenia’s economy amounted to 59.8 billion drams. This figure represents the difference between inflows and outflows. This is equivalent to almost 120 million dollars. Net inflows of direct investments have increased by 2.7 billion drams or 5.5 million dollars compared to the same period last year.

It seems that everything is not as bad as it is often presented. Net investment inflows have indeed increased. However, this is by no means the merit of the current government. On the contrary, official statistics show that net inflows of direct investments in Armenia’s economy sharply declined in the period following the change of power. Furthermore, this is true both in comparison to the beginning of this year and the same time last year.

In the first quarter of the current year, net inflows of direct investments in the economy amounted to 40.3 billion drams. In the subsequent two quarters, they were only 19.5 billion drams.

It is not difficult to correlate these figures and imagine what has actually happened.

It is evident that the net inflows of direct investments made in the economy have significantly decreased after the change of power. Over six months, the volumes were half that of the first three months of the year. This is the real picture regarding investments.

By the way, in the second and third quarters, investments were also less than in the previous year; compared to the same period in 2017, they were double that amount.

In such dismal statistical conditions, it is inappropriate to take pride in the increase in investments. The growth recorded by the statistical service in the first nine months is solely the result of investment activity at the beginning of the year. Naturally, this government had no participation in this.

On the contrary, instead of ensuring an investment boom in Armenia's economy, even the achievements of the previous period have not been maintained.

Judging by the figures published by the Statistical Committee, direct investments this year amounted to around 387 million dollars in the first nine months. In the first quarter alone, over 185 million dollars were injected into the economy.

Compared to last year, direct investments have decreased by more than 85 million dollars. This has mainly occurred in the period following the change of power. In the second and third quarters, direct investments decreased by 77 million dollars compared to the same period last year.

And this is not coincidental, considering how much the government has “contributed” to encouraging investments,” the newspaper writes.

The continuation is in today’s issue of the newspaper.