Vote 2012: Economic policies as main focus of election campaigns in Armenia?

Vote 2012: Economic policies as main focus of election campaigns in Armenia?

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Cost of goods in Armenia increased by 20% since last year.

Against the backdrop of rising inflation, falling standards of living, general impoverishment of the population as well as promises of the incumbent authorities to ensure the conduct of independent Armenia’s fairest elections, the main focus of the campaigning may become economic platforms of political parties.

It is yet unclear whether the parties will actually give prominence to their economic programs during the electioneering period, since until now the determining factors during elections have been administrative, financial and power resources rather than party manifestos. As a result, political parties wielding considerable resources but lacking clear economic policies could easily end up in parliament. As of now, even an economist would find it difficult to define what economic steps and directions are being proposed by one Armenian political party or another.

Towards the end of the current parliament’s term the ruling Republican Party of Armenia (RPA) proposed a number of very specific steps. At a meeting on February 2 the RPA-dominated government approved the decision to create the first free economic zone in the country as well as provide tax breaks for companies working in the sphere of information technologies. This is part of a program of export-oriented economy, which, according to Prime Minister Tigran Sargsyan, should be based on developing technologically advanced industries. But so far the government has managed to develop the mining industry that provides the bulk of exports. In addition, the economic policies of the current government have not resulted in any significant growth in terms of social welfare.

The opposition Armenian National Congress (ANC) declares that the Armenian economy is reeling under monopolies and oligarchy. Former Prime Minister Hrant Bagratyan developed a “100 Economic Steps” program that he claims will help get back to the basics of free market. The steps being proposed by the ANC imply political decisions and even some redistribution of property. The ANC also claims that the government considers emigration to be a good source of public revenue. Last year labor migrants wired more than $1.2 billion to their families back in Armenia, and the government has not hidden its satisfaction on this account.

The Armenian Revolutionary Federation (ARF, Dashnaktsutyun) that quit the governing coalition in 2009 is very critical of the government’s economic policies, claiming that they lack social orientation. The ARF, which is essentially a socialist party, has long been advocating an increase in wages, pensions, direction of budget funds for solving social problems. It makes serious calculations, proving that even the available funds are sufficient for raising pensions and salaries.

The Prosperous Armenia Party (PAP), which is the RPA’s junior partner in the three-party ruling coalition, is being actively involved in charity and is not particularly concerned with presenting specific economic proposals. It is not yet clear what exactly are the economic policies espoused by tycoon Gagik Tsarukyan’s party – whether it is a bourgeois or socialist economy, a further enrichment of the “good oligarchs” that do charity, or joining the Russia-led Eurasian Economic Union. After PAP lawmaker Vardan Bostanjyan stated that at the 2013 presidential election the party will support current president and RPA leader Serzh Sargsyan, it became clear that the PAP again counts on a deal with the government that will allow it to use some of the administrative resource and will spare it the need to expound on its specific economic approaches.

Meanwhile, life in Armenia is becoming increasingly harder. Despite government assurances about growing macro-economic indicators and reduced corruption risks a more than 20 percent rise in prices for foodstuffs was recorded in January as compared to the same period in 2011. The month-on-month increase in food prices (compared to December 2011) made 6.2 percent.