Tuesday, 10 January 2012
From the Palette of 2011
2011 is over: normally, it is the time to summarize past year’s achievements and shortcomings. As we ushered in the year 2011, the government concentrated on a number of important programs, most of which were carried out during the past year.
Specifically, new approaches were introduced in agriculture
Following the unprecedented decline of 2010, the farming sector soon recovered to boast 14% growth last year. According to experts, this was triggered not only by favorable climatic conditions but also owing a number of projects implemented in this field.
The wheat and barley seed-breeding program yielded the first fruits in 2011. The program proceeded as follows: imported from the Russian Federation, large quantities of elite seeds were distributed among the domestic farmers with over 7 hectares of crop areas on condition that they should return twice as much reproduced seeds to the State.
As a result, not only did the eligible farms update the existing stock of grain seeds, but they also managed to boost the output of wheat. The State came on the winning side with 20 percent more cultivated land, at least for the time being.
The first cooperative farms emerged in 2011 involving 33 rural communities which were provided with new farm machinery and development programs.
The farmers finally managed to sell their products first-hand. Purveyance and settlements were made in a timely manner, especially for grapes, apricots, tomatoes, cereals. A wholesale market was established thanks to closer government-purveyors cooperation. New facilities will be up next year to serve as a rendezvous for farmers and consumers.
The government subsidized agricultural loans to the rate of AMD 15 billion. As a result, thousands of farms benefited from affordable 8-10% lending resources.
Real investments in the real sector
The government passed 21 decrees to grant VAT deferments to those companies importing capital goods worth over 300 million drams. According to experts, this is the most effective tool for stimulating investment programs due to which direct investments rose to 84 billion drams generating over 2000 new jobs nationwide.
The government next approved the concept of Armenia’s export-oriented industrial development implying a transition from importing country toward exporting one. A 10-year action plan is out for the following 3 sectors: brandy-making, pharmaceuticals and precision engineering which are expected to triple output by 2015.
The Armenian-Iranian cooperation scheme referred to as “electricity for gas” was launched early this year. Armenia has already exported some 2 billion kW/h electricity, which is even said to exceed the export of diamonds.
The first steps are underway in the free economic zone of Zvartnots international airport. It will help organize retail and wholesale trade of fresh fruits and vegetables, as well as freezing, sorting and packing activities. In parallel, efforts are underway to set up a high-tech free trade zone on the site of Mars factory.
The US government-supported “Millennium Challenge Account-Armenia” five-year program was completed in 2011. Sizeable work was carried out in rural areas. 177 million dollars were invested in Armenia’s irrigation system alone all the way through program implementation which is the largest amount invested in this area for the past 30 years.
The 4th annual ArmTech Congress was held in Yerevan and surprised by its geographical coverage. The participation of Singapore’s ST Kinetics, Latvian “Acme Computer Components,” as well as other leading companies evidences that the high-tech world appreciates Armenia’s potential in this area.
The State Commission on Protection of Economic Competition stood out for its unprecedented activity this year. High-profile revelations were made in the oil, dairy products and coffee markets. Tighter control of unfair competition proved highly effective in settling the market rules.
After a long break, the rate of inflation finally “came” in the projected corridor. Inflation stood at 4.7% by yearend.
A new tax package was introduced last year. First of all, small businesses were exempted from VAT liability in early 2011. Later on the mining industry was imposed with additional tax burden. The luxury tax came into application and the excise tax was leveled for local and imported goods. Later last year, the whole body of inspectorates, including the tax one, published the shortlists of those organizations eligible for inspection in 2012.
Business registration procedures were simplified with the introduction of “one-stop-shops” in this area.
Armenia managed a 6-point improvement on its index of the World Bank’s Doing Business chart, soaring from 61 to 55. This was due to a series of steps undertaken by the Government toward a better business environment in terms of tax administration, construction permits, lending accessibility, customs declaration and so on. Online facilities were enabled for tax reporting and patent getting activities.
The frequency of tax reports was reduced. Improved tax- and passport-processing local services were commissioned nationwide.
A number of decisions were adopted to facilitate the life of our citizens. For example, people can now get their driver’s licenses under a simplified procedure whereby there is no need to get certificates from the drug control and mental health centers or take a preliminary study course.
Serious progress was made in other paid services. For instance, the State Committee on Immovable Property Cadastre by the Government was forbidden to conduct measurement and inspection activities in the transaction of purchase and sale of notaries have been ordered and the amount charged by notaries between the conditions were created for the competition, car inspection stations were forbidden to take money from citizens: Payment must be made only through banks, adopted a special decision to exempt the citizens from the duty to provide medical records from outpatient clinics.
Welfare issues in focus
The pensioners’ registers were cleared up as part of the ongoing pension reform. Armenian pensioners were offered the possibility of using non-cash pension plastic cards. The savings so made allowed the State to increase the amount of pensions by 10 percent.
A new legislative framework was set up for the launch of the funded pension system.
The system of State benefits has been streamlined and targeted. 17 thousand households were acknowledged to be non-eligible for getting vulnerability benefits.
The “Affordable housing for athletes, doctors, journalists and teachers” program was initiated last year. The intended building will have 5 fully equipped blocks, 13 stories each.
The government disbursed AMD 20bn from its reserve fund to provide for harmonious development of regions and achieve improved living standards for rural population. The Premier’s Control Service watched over the targeted use of these funds.
