New Armenian Cabinet Vows Major Reforms

[:en](RFE/RL)-Armenia’s newly reshuffled government has released its policy program that pledges to help speed up economic growth through a tougher fight against corruption, better tax administration and “equal conditions” for all businesses.

The program adopted at a cabinet meeting in Yerevan late on Tuesday will be sent to the Armenian parliament on Thursday. Its approval by the National Assembly will amount to a vote of confidence in Prime Minister Karen Karapetian’s cabinet.

“I am instructing everyone to pay special attention to the program’s implementation,” Karapetian told ministers. “We are going to be accountable.”

“Given the ongoing global and regional developments, conventional approaches to [Armenia’s] development cannot ensure a pace of progress congruent with our challenges,” declares the 33-page document.

“Analysis of the economic situation shows that it is extremely difficult to ensure progress with standard methods and tools,” it adds.

The government’s stated “strategic” priorities include a strengthening of the fight against corruption and tax evasion, and “equal and fair conditions stimulating business.” The program commits it to improving Armenia’s business environment in a way that would be recognized next year in annual survey conducted by the World Bank.

In particular, the government will reduce or simplify its licensing requirements and other regulations for some types of economic activity. It also pledged to reform Armenia’s tax and customs services with the aim of making tax collection less arbitrary.

The program specifically reaffirms Karapetian’s plans to curb customs officials’ highly controversial discretionary authority to determine the market value of goods imported to Armenia. That has long been seen as a key source of widespread corruption in the customs service.

Karapetian said last week that tax officials must stop harassing “law-abiding” entrepreneurs and simplify taxation procedures for all businesses as he introduced the new head of the State Revenue Committee (SRC), Vartan Harutiunian, to senior SRC staff. Harutiunian is the premier’s longtime associate.

The program also promises “more efforts to eliminate the biggest obstacle to the development of the state: favoritism, embezzlements, bribery and other manifestations of corruption.” It says the government will seek to criminalize within the next three months “illegal enrichment” of state officials. The government will also introduce new legislation on conflicts of interest, it says.

Sona Ayvazian, the executive director of the Armenian affiliate of the global anti-graft watchdog Transparency International, was unimpressed by these promised measures. “These wordings do not fully reflect the magnitude of the existing problems and solutions needed for them,” she told RFE/RL’s Armenian service (

Armenia ranked 95th out of 168 countries that were evaluated in Transparency International’s 2015 Corruption Perceptions Index (CPI).

Karapetian and his cabinet will technically serve until Armenia’s next parliamentary elections scheduled for April. “The program covers the six-month period until the parliamentary elections of April 2017,” Labor and Social Affairs Minister Artem Asatrian confirmed after Tuesday’s cabinet meeting.

This may explain why the publicized plan of government actions contains no economic growth forecasts. The Armenian economy is on course to grow at a relatively modest rate of 2-3 percent this year. The government expects growth to only slightly accelerate in 2017.

Finance Minister Vartan Aramian said earlier this month that Gross Domestic Product must increase by at least 4 percent annually in order to ease hardship and boost living standards in the country.[:]