12.09.2013JOINING THE CUSTOMS UNION IS ECONOMICALLY ADVANTAGEOUS TO ARMENIA - EXPERTS
It is economically advantageous to Armenia to join the Customs Union. According to “ARKA” news agency this is the conclusion, a group of experts, which carried out special economic survey on these issues, came to.
Following the results of the negotiations between the president of Armenia Serzh Sargsyan and president of Russia Vladimir Putin, held on September 3, it was stated that Armenia intended to join Customs Union and to take part in the formation of the Eurasian Economic Union in the future. It was planned earlier that Yerevan would sign the EU Association Agreement and free trade zone agreement.
According to the chairman of “Integration and Development” NGO Aram Safaryan, the survey was carried out on the initiative of the Eurasian Development Bank in order to find out prospects and possibilities of Eurasian integration.
Leader of the expert team, Head of the Chair of the Mathematical Methods in Economics of the Armenian State Economic University Ashot Tavadyan stated that the decision to join the Customs Union was not a surprise for the specialists.
“Back in 2011 in Saint-Petersburg, heads of the governments (of the CIS countries) signed an agreement on free trade zone which was ratified on September 11, 2012 by the National Assembly of Armenia almost unanimously. Preliminary agreement on the Customs Union became the logical continuation of that process”, - said Tavadyan at the press-conference in the “Novosti” International Press Center.
According to him, the agreements on joining the CU embrace issues of economic security and cover such key spheres as energy and transport. The expert also mentioned that unprecedented investments are stipulated and employment growth is expected.
“Transport component includes development of the railway; particularly it supposes $470 million investments. These are direct investments. Having additional communications is crucial for us. The EU will not do that, taking into consideration problems with Iran”, - said Tavadyan.
He also said that the investments of the Eurasian Development Bank would be about $100 million which would allow increasing growth rate at 0.3-0.4%.
The expert also mentioned that the energy component, i.e. further exploitation of the operating Nuclear Power Plant and building of a new one, and automatic gas price reduction on 30% (from $270 to about $180), is the second most crucial component. He added that such price reduction promotes the GDP growth at almost 1%. Besides, joining the CU would allow reducing petrol production prices as well.
“The third component refers to the production and is directly connected with the employment level, work of “Nairit” Chemical Company and construction of the oil pipeline. We will have and opportunity to secure orders at the big markets of the CU countries”, - said Tavadyan.
According to him the 4th factor which furthers economic growth rates at about 0.25% refers to migration. “The procedures of the job placement for the migrants will be simplified, administrative obstacles will be raised which will bring to the growth of transfers”, - said the expert.
He also said that according to estimations in case of joining the CU 4% GDP growth in the short-run, with a possibility of sharp increase of this index taking into consideration the aforementioned factors, is forecasted.
While speaking about the problem of absence of common border with the CU countries, Tavadyan mentioned that these difficulties could be compensated at the expense of the price for the energy carriers.
“In the economic aspect it is advantageous... Living secure, people will live better in case of the GDP growth”, - said Tavadyan.
He added that joining the CU will not affect the volume of exports to the EU countries because Armenia exports to Europe mainly raw materials.
At the same time head of the “Integration and Development” NGO Aram Safaryan added that joining the Customs Union make opening of the Abkhazian railway section, which is so crucial for Armenia, more probable.
While speaking about the prospects of the European economic integration, Tavadyan stated that 2.3% GDP growth in a long-run without taking into consideration the risks is expected.
According to Tavadyan these risks are the problems with Turkey, overdependence on raw materials, corruption. “But the corruption problems we must solve by ourselves and integration processes are not connected with them”, - said Tavadyan. The most serious risk in case with the Euro-integration, in his opinion, is connected with the restrictions imposed by Russia, which could nullify growth forecasts.
Besides, there can be no full-fledged free movement of goods, capital and services without full-fledged free movement of people.
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