The expected rise in retail natural gas prices by nearly 40 percent and a resultant increase in prices for other goods and services has become ground for anticipation of social upheavals. The Armenian Revolutionary Federation (Dashnaktsutyun) has voiced strict criticism of the social and economic policies being pursued by the government. Its representatives in parliament, including economist Ara Nranyan, do not rule out the possibility of a social upheaval in the country.

People in public transport, in offices and in the street can be heard voicing discontent with the upcoming rise in gas prices and what they view as inadequate social policies of the authorities. Non-working young mother Narine Avagyan says that her husband is the only breadwinner in their six-member family and he earns a little more than 180,000 drams (about $470 a month).

“Only two years ago that wasn’t a bad income at all. That would be enough for us to buy food and some clothes and pay the utilities bills. During the past several years prices for everything have gone up, and we’ve had to cut back on some of the expenses, such as buying new things, and will have to be more modest in food,” said the resident of Zovuni, a small town near capital Yerevan.

The rise in natural gas prices also concerns taxi drivers in Armenia. Most of them use liquefied gas as main fuel. Cab drivers, especially private entrepreneurs, fear there will be fewer customers who can afford a ride in taxi when they have to charge more. (Taxis in Yerevan and other locations in Armenia normally charge 100 drams, or about 25 cents, per kilometer).

Representatives of coalition parties say that things will not reach extremities, since the government intends to compensate the rise in gas prices for vulnerable strata of the population. However, discussions in mass media have already started regarding mechanisms of manifestation of social protest. In the country that lacks the institution of trade unions as such and where nongovernmental organizations advocating the rights of consumers do not have due influence, it is political parties that may become the conductors of social protests.

The Armenian National Congress (ANC) indicates its readiness to lead the social movement. The opposition alliance has also chided the government for its economic policies. The ANC has even advanced its own program of economic reform called “100 Steps”, which it consider necessary for ending the economic and social crisis in the country.

Economists think that the increase in the gas price sought by the distribution monopolist, ArmRosgazprom, is the result of an improper economic structure in Armenia. Aristomene Varoudakis, head of the World Bank office in Yerevan, urged the Armenian government to wage a more effective antitrust struggle, carry out reform in the tax and customs spheres. Like other international experts, he thinks that the fusion of monopolies and political authorities hampers the development of Armenia.

It is symptomatic that statements about fighting oligopolies are also heard in the upper echelons of power. During a recent extended meeting of the Committee on State Revenues President Serzh Sargsyan, in quite tough words, stated that now it is time tax bodies stopped the practice of “roofing” (or patronizing) businessmen.

In the crisis year of 2009 Armenia managed to avoid social upheavals that the 14 percent economic decline could have caused and that was largely due to foreign loans that the government received to alleviate the consequences of the global recession. Salaries and social pensions were paid in time, state social programs were implemented in time. Armenia’s solvency, however, has reduced this year as a result of that borrowing and there is no information on attraction of new credits yet. Economists say one should not rely on foreign aid anymore, especially that Armenia’s foreign debt has already reached the level of 46 percent of Gross Domestic Product. They advise seeking resources within the economy, stimulate the development of small and medium-sized business – “to the detriment of monopolies.”