Corruption obstacles growth of Armenian businesses

/By AzerNews/

By Laman Saidigova

It is not new that corruption is the major obstacle for doing business in Armenia, the smallest country of the South Caucasus inhibited by limited investment opportunities.

Complaints about corruption in the post Soviet country have reached their peak amid the government's inability to promote business development.

Whatever steps the incompetent government undertakes, the situation is only getting worse.

Perhaps, the problem lies deeper as almost half of the current Armenian government officials are oligarchs who use their power to enlarge their own businesses.

For example, Ovik Abramyan is an oligarch who has open and hidden businesses in many industries. While he was the head of the legislature his influence over the executive body was limited. Now, his meddling into businesses is overt. As a classic oligarch, Abrahamyan will protect the interests of his class, and the levers of executive power will fully provide him with such capabilities.

After Armenia's joining the Eurasian Economic Union, Armenian companies and entrepreneurs have faced additional bureaucratic obstacles that force businessmen to resort to the corruption that is already widespread in the country, according to the numerous reports of international organizations.

Despite feelings that the situation would become better after joining EEU, the people’s hopes have collapsed. The unwise economic policy of the government and staggering levels of corruption have made it clear that the country is still in danger.

Despite the opinion that the Armenian government is pressing ahead to contain corruption, it seems like the government is the lever moving people toward corruption.

For example, one of the latest cases of corruption has been when the director of the Val Otomeyshn Company, Vardges Gaspari, faced serious problems with the clearance of goods imported from Taiwan through customs.

The engineer says that it would not be so difficult to get permission to import goods if he had given a bribe, as many others do. After Armenia entered the EEU, the country faced even more corruption risks.

Much of the bribes with business interests are controlled by Armenian officials who oversee the patron-client networks within the government itself, anti-corruption watchdog Transparency International Armenia wrote in the recent report.

The civil society apparatus and media in Armenia remain the weakest non-government powers even though they are an inherent part of any country struggling against bribery. Prosecution over corruption crimes and related activities remains at a low level in keeping with previous years' observations.

Meanwhile, despite the mandate of the Anti-Corruption Council, which receives funds from the E.U. and USAID, nobody believes that it is bringing order to juridical irregularities and injustice in the society. The council formally began operations at the end of July and was supposed to include opposition and civil society members as well as government officials on board. But no one from the opposition or non-governmental organizations has joined, mainly due to skepticism about its efficiency.