YEREVAN, January 23. / ARKA /. Former president Robert Kocharyan criticized today Armenian authorities for taking insufficient efforts to prevent a dramatic decline of the national currency last December saying the central bank and other government agencies should have acted quickly and in a coordinated way by using all the available monetary, fiscal and administrative instruments of influence.
In an interview posted on his unofficial site the ex-president says it is easy to blame everything on external factors and act as a victim of geopolitical processes.
‘External factors play a role, but in December last year they uncovered the diseases of our economy. The Central Bank should not have been guided by the behavior of the Russian ruble in adjusting the exchange rate of the dram.’ he said.
According to Kocharyan, with the prevailing moods and negative expectations in Armenia even small size speculative trading in currencies can cause panic and play a crucial role, despite the seeming financial stability.
“The exchange rate of the dram reflects the overall state of the economy and balance of payments. Abrupt fluctuations that threaten the financial system of the country, undermining confidence in the currency are unacceptable,’ he says.
As for the drop in oil prices, according to Kocharyan oil-importing countries benefit from it because cheap gasoline and diesel fuel are a good incentive for economic growth.
‘In Armenia they could compensate for losses from a decline in private transfers from Russia, given cheap energy’s large multiplier effect on the economy,’ says Kocharyan.
According to him, this is possible with a sound competition in the energy market (prices of petrol in Armenia are entirely a subjective factor, reflecting the degree of monopolization of this market).
“By the way, taking into account global trends the price of natural gas supplied to the country by Russia could be revised downward but that is not easy because of the recently signed agreement with Gazprom,” he says.-0-
