Economic News from Armenia
Study Highlights Need for Reform in Some Areas of Armenia's Business
Environment
By Shakeh Avoyan
Armenia is 44th among 181 economies by the overall ease of doing
business in the country, according to the latest study by the World Bank
and the International Financial Corporation.
In last year's Doing Business report Armenia ranked 41st, but the number
of evaluated economies then was 178.
`Throughout the year, Armenia reorganized its court system and
overhauled the procedural code. New requirements to frontload evidence
eased contract enforcement, removing one procedure and reducing the time
required to resolve commercial disputes,' the report said. `Armenia also
significantly reduced the cost to obtain construction permits in Yerevan
by abolishing `mandatory charitable contributions' paid to obtain the
right to design.'
`However, despite these steps, Armenia's ranking in some critical areas
of the business environment, such as the ease of paying taxes and
trading across borders, remained very low, highlighting the importance
of pursuing reforms ambitiously so as to strengthen Armenia's
competitiveness and attractiveness to investment,' mentioned Aristomene
Varoudakis, Armenia Country Manager, the World Bank.
Doing Business ranks economies based on 10 indicators of business
regulation. It provides a quantitative measure of regulations for
starting a business, dealing with construction permits, employing
workers, registering property, getting credit, protecting investors,
paying taxes, trading across borders, enforcing contracts and closing a
business ` as they apply to domestic small and medium-size enterprises.
Armenia's neighbor Azerbaijan is estimated as the country with the
biggest progress in reforming business regulations, as it rose from 97
to 33 in the global rankings on the ease of doing business. `The country
undertook reforms in seven of the 10 areas studied by the report `
speeding business startup, contract enforcement, and property
registration; easing tax administration burdens and employment
restrictions; and strengthening investor protections and credit
information,' the report said.
`Economies need rules that are efficient, easy to use, and accessible to
all who have to use them. Otherwise, businesses are trapped in the
unregulated, informal economy, where they have less access to finance
and hire fewer workers, and where workers lack the protection of labor
law,' said Michael Klein, World Bank/IFC Vice President for Financial
and Private Sector Development. `Doing Business encourages good rules,
and good rules are a better basis for healthy business than `who you
know', he added.
Among the top ranked economies in the study are Singapore, New Zealand,
the United States, Hong Kong (China), Denmark, the United Kingdom,
Ireland, Canada and others.
By Shakeh Avoyan
Armenia is 44th among 181 economies by the overall ease of doing
business in the country, according to the latest study by the World Bank
and the International Financial Corporation.
In last year's Doing Business report Armenia ranked 41st, but the number
of evaluated economies then was 178.
`Throughout the year, Armenia reorganized its court system and
overhauled the procedural code. New requirements to frontload evidence
eased contract enforcement, removing one procedure and reducing the time
required to resolve commercial disputes,' the report said. `Armenia also
significantly reduced the cost to obtain construction permits in Yerevan
by abolishing `mandatory charitable contributions' paid to obtain the
right to design.'
`However, despite these steps, Armenia's ranking in some critical areas
of the business environment, such as the ease of paying taxes and
trading across borders, remained very low, highlighting the importance
of pursuing reforms ambitiously so as to strengthen Armenia's
competitiveness and attractiveness to investment,' mentioned Aristomene
Varoudakis, Armenia Country Manager, the World Bank.
Doing Business ranks economies based on 10 indicators of business
regulation. It provides a quantitative measure of regulations for
starting a business, dealing with construction permits, employing
workers, registering property, getting credit, protecting investors,
paying taxes, trading across borders, enforcing contracts and closing a
business ` as they apply to domestic small and medium-size enterprises.
Armenia's neighbor Azerbaijan is estimated as the country with the
biggest progress in reforming business regulations, as it rose from 97
to 33 in the global rankings on the ease of doing business. `The country
undertook reforms in seven of the 10 areas studied by the report `
speeding business startup, contract enforcement, and property
registration; easing tax administration burdens and employment
restrictions; and strengthening investor protections and credit
information,' the report said.
`Economies need rules that are efficient, easy to use, and accessible to
all who have to use them. Otherwise, businesses are trapped in the
unregulated, informal economy, where they have less access to finance
and hire fewer workers, and where workers lack the protection of labor
law,' said Michael Klein, World Bank/IFC Vice President for Financial
and Private Sector Development. `Doing Business encourages good rules,
and good rules are a better basis for healthy business than `who you
know', he added.
Among the top ranked economies in the study are Singapore, New Zealand,
the United States, Hong Kong (China), Denmark, the United Kingdom,
Ireland, Canada and others.
ARMENIA TO SELL ELECTRICITY TO TURKEY STARTING FROM 2009
Noyan Tapan
Sep 11, 2008
YEREVAN, SEPTEMBER 11, NOYAN TAPAN. Starting from 2009, Armenia will
sell electricity to Turkey. According to Azg daily, the Armenian
minister of energy and natural resources Armen Movsisian announced
this during a briefing with reporters. He said that discussions
on this issue were held during the visit of the Turkish president
to Armenia at the invitation of the Armenian president. During the
meetings, an agreement was also signed between the ministry and Unit
company (Turkey) which is engaged in the import and distribution
of electricity in Turkey. Besides, an agreement was signed between
High-Voltage Electric Networks of Armenia and Unit on the direct
export of electricity from Armenia through Kars. The date of starting
the electricity export depends on the Turkish side. The price of
electricity to be exported will be calculated by a special formula
based on the price of gas. In the words of A. Movsisian, this price
will be economically efficient and well-founded: by rough estimates,
1 kw will cost 5.7 cents. It was mentioned that Armenia last supplied
electricity to Turkey in the Soviet time.
Noyan Tapan
Sep 11, 2008
YEREVAN, SEPTEMBER 11, NOYAN TAPAN. Starting from 2009, Armenia will
sell electricity to Turkey. According to Azg daily, the Armenian
minister of energy and natural resources Armen Movsisian announced
this during a briefing with reporters. He said that discussions
on this issue were held during the visit of the Turkish president
to Armenia at the invitation of the Armenian president. During the
meetings, an agreement was also signed between the ministry and Unit
company (Turkey) which is engaged in the import and distribution
of electricity in Turkey. Besides, an agreement was signed between
High-Voltage Electric Networks of Armenia and Unit on the direct
export of electricity from Armenia through Kars. The date of starting
the electricity export depends on the Turkish side. The price of
electricity to be exported will be calculated by a special formula
based on the price of gas. In the words of A. Movsisian, this price
will be economically efficient and well-founded: by rough estimates,
1 kw will cost 5.7 cents. It was mentioned that Armenia last supplied
electricity to Turkey in the Soviet time.
CONSTRUCTION OF IRAN-ARMENIA GAS PIPELINE COMPLETED
Noyan Tapan
Sep 11, 2008
YEREVAN, SEPTEMBER 11, NOYAN TAPAN. The construction of the
Iran-Armenia gas pipeline has been completed. According to Azg daily,
the Armenian minister of energy and natural resources Armen Movsisian
announced this during a briefing with reporters. In his words, it
remains to complete the work on increasing the carrying capacity of
the Kajaran-Yerevan section of the gas pipeline, which will be done
by November of this year. The test of the pipeline will start soon,
after which it will be possible to use it in full operation.
A. Movsisian said that the gas pipeline will allow to import up
to 2.3-2.5 billion cubic meters of gas into Armenia annually. To
what extent the pipeline will be used depends on demand. The
Iranian gas will be used in parallel with Russian one - in case of
necessity. "Under various force majeure circumstances, this will
allow to ensure normal gas supply and avoid shocks in the country,"
the minister said.
THE TURKISH ILLUSION
by R. Manafli
Ekho
Sept 10 2008
Azerbaijan
This is how they in Azerbaijan view the statement by Turkish Foreign
Minister Ali Babacan on the use of Armenian territory as an alternative
route to Georgia to transport Caspian energy resources
The stand of Baku is that any cooperation between Azerbaijan and
Armenia may be possible only after the settlement of the protracted
Nagornyy Karabakh conflict within the framework of Azerbaijan's
territorial integrity. Against this background the statement by Turkish
Foreign Minister Ali Babacan on the use of Armenian territory as an
alternative route to Georgia to transport Caspian energy resources
is nothing more than an illusion and populism, renowned national
experts a political analyst and the head of the Centre for Political
Innovations, Mubariz Ahmadoglu, and economist Oqtay Haqverdiyev,
told Ekho. [Passage omitted: background of Ali Babacan's statement
and his remarks on cooperation with Armenia]
In the meantime, Azerbaijan is seriously concerned over such statements
by Turkish officials, which became frequent before, during and after
the visit of the Turkish leader to Yerevan. However, they are trying
not to take those statements seriously and are calling them "Turkish
illusions" and populist statements. In any case, Mubariz Ahmadoglu
told Ekho that in Turkey they have recently been cultivating too many
illusions on cooperation with Armenia.
By the way, the political analyst recalled that such an issue emerged
in the times of late Azerbaijani President Heydar Aliyev. "At first,
Armenia itself refused to join regional energy projects. Then, the
Armenian Diaspora in the USA started to send appeals to the US Congress
that Azerbaijan is isolating Armenia from regional projects. Even
the USA could not do it [have Armenia in regional projects] then,"
Ahmadoglu hinted.
At the same time, he stressed that Armenia longs for a chance to be
involved in regional energy projects of international significance
without the settlement of the Nagornyy Karabakh conflict. "Azerbaijan's
position is known to all, according to which any cooperation between
Azerbaijan and Armenia may be possible only after the settlement of
the protracted Nagornyy Karabakh conflict within the framework of
Azerbaijan's territorial integrity," Ahmadoglu said.
He added that Azerbaijan has enough power to counter such
initiatives. "We can stand for a long time, while in Turkey a lot of
such illusions on cooperation with Armenia have been created recently,"
the head of the Center for Political Innovations concluded.
In his turn, renowned economist Oqtay Haqverdiyev said that the
statement by Turkish Foreign Minister Ali Babacan on the use of
Armenian territory as an alternative route to Georgia to transport
Caspian energy resources is populism. According to him, this is only
a political move, which Turkey uses to try to achieve some of its
targets and satisfy its state interests.
In reality, the economist says that it is unreal. "Even if we
hypothetically imagine the developments in the region in this way,
how much time will we need for this to happen? During this time the
situation in the region will change ten more times and it is not
known if this will be needed," Haqverdiyev said.
According to him, such statements do not need to be taken seriously
since they smell populism.
It should be noted that Ekho failed to contact the press secretary
of the Azerbaijani Foreign Ministry, Xazar Ibrahim, yesterday
[9 September]. However, Baku's official position remains unchanged
cooperation with Armenia can never be in question until the Nagornyy
Karabakh conflict is resolved within the framework of the territorial
integrity of our country.
Armenia Shuts Down Nuclear Plant For Renovation
AFP
Armenia has shut down its Metsamor nuclear power station for 85-day
renovation works and refueling, the station's chief engineer told AFP
Monday.
"The station was shut down on September 5 at midnight and will be
launched again on November 29. There will be repairs, refueling, and
some measures aimed at boosting security," Movses Vartanian said.
"Meanwhile, there will be no restrictions in energy supply to the
customers -- other stations will make up for the loss," Vartanian said.
Armenia relies on the Soviet-built Metsamor plant, 30 kilometers (18
miles) west of the capital Yerevan, for 40 percent of its electricity
needs. The European Union has pleaded with Armenia to close the ageing
plant, which is in an area prone to earthquakes, and in 2004 offered to
provide 100 million euros ($148 million) in compensatory aid.
But Armenian officials say their landlocked and resource-poor country
cannot afford to do without the plant, which also provides electricity
for export to neighboring Iran.
The nuclear plant's two reactors were shut down temporarily in 1988
because of a major earthquake, but one of them resumed operating in 1995
to help stave off a national energy crisis.
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AFP
Armenia has shut down its Metsamor nuclear power station for 85-day
renovation works and refueling, the station's chief engineer told AFP
Monday.
"The station was shut down on September 5 at midnight and will be
launched again on November 29. There will be repairs, refueling, and
some measures aimed at boosting security," Movses Vartanian said.
"Meanwhile, there will be no restrictions in energy supply to the
customers -- other stations will make up for the loss," Vartanian said.
Armenia relies on the Soviet-built Metsamor plant, 30 kilometers (18
miles) west of the capital Yerevan, for 40 percent of its electricity
needs. The European Union has pleaded with Armenia to close the ageing
plant, which is in an area prone to earthquakes, and in 2004 offered to
provide 100 million euros ($148 million) in compensatory aid.
But Armenian officials say their landlocked and resource-poor country
cannot afford to do without the plant, which also provides electricity
for export to neighboring Iran.
The nuclear plant's two reactors were shut down temporarily in 1988
because of a major earthquake, but one of them resumed operating in 1995
to help stave off a national energy crisis.
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