Robert Kocharyan speaks about Gyumri tragedy and economic situation in Armenia
In his latest interview with his unofficial website, 2rd.am, Armenia’s former president Robert Kocharyan spoke of the latest developments in Gyumri, as well as economic and domestic political situation in Armenia. Kocharyan called for drastic changes in the country to deal with the current economic challenges. Mr Kocharyan, the first question concerns the recent tragedy in Gyumri which angered the residents of the city triggering popular unrest in the city which developed into clashes between police and protesters amid emotional tensions. The reason for the unrest and the popular unrest was uncertainty of these two questions. Which country is to try the murderer of the Avetisyan family? What should Armenian authorities have done in the given situation? The crime committed in Gyumri has shocked the entire country with its extreme cruelty. It was obvious that the protest could have developed into large-scale actions with unpredictable consequences. The authorities should have acted very rapidly to prevent such sentiments by providing assurances that the murder would be investigated by Armenian law-enforcement bodies and the criminal would stand trial in Armenia. We have a precedent of 1999. I am sure that it was necessary for both the Armenian and Russian sides, as this way all attempts to speculate on Armenian-Russian relations within the context of a concrete tragedy would have been precluded. The vague, contradictory and confusing statements by our officials only poured oil on the flames. This led to a confrontation and people poured out their wrath on the police. Anyway, an appalling tragedy occurred in Gyumri and my family and I are deeply shocked by it. We share the grief of our people. The sharp depreciation of the Armenian currency in December caused a real shock in Armenia. Armenia had not seen such a serious decline of the Armenian currency for a long time. Government officials cited geopolitical reasons for the situation, particularly the downfall of the Russian ruble, the decline in oil prices and anti-Russian sanctions. Do you think that the ‘black December’ was conditioned solely by external factors? Did Armenian respond adequately to the situation? Will the dram continue depreciating? This is the second time in the past five years. Of course, blaming the situation on external factors is the easiest way. Russian economy was in a much worse situation in 1998 during the August default. A 6% economic decline was recorded, and the ruble showed triple depreciation against the USD. Today, Russia has huge gold and foreign currency reserves, which rule out a further default .Against the background of this, the Armenian currency showed stability despite Armenia’s weak economy and banking system. The external factors on which the government blamed the situation could not be the reason for the ailment of our economy, but only revealed its already existing disease. However, even the minor speculations might lead to panic among the population and have a decisive role despite the seemingly financial stability. The Central Bank officially bears responsibility for the Armenian currency and it made certain steps within its powers] to stabilize the Armenian dram. But it was not enough given last December’s events. Urgent and coordinated actions of all institutions of government were necessary, with the application of all instruments – monetary, fiscal and administrative. Judging by the results, those actions were belated and with shortcomings. Economists believe that ‘during crises the authorities’ reputation and management efficiency is often more important than fundamental factors.’ What is to become of the Armenian dram? The exchange rates reflect the general situation of the economy and payment balance. Their deterioration will further depreciate the dram, while the improvement will strengthen the position of the Armenia currency. The dram cannot survive isolated from the general economy. Anyway, sharp fluctuations of the currency rate are impermissible; they threaten the financial sector, undermining trust in the national currency and hitting our citizens’ pockets. The former president also spoke about Armenia’s accession to the Eurasian Economic Union and said it will be difficult to solve the existing problems without drastic changes. He also said the acting authorities should admit the existence of the fundamental problems and be disposed an open dialogue with the society and businesses. The full interview is available in the Armenian section of the website.
