Today.Az » Analytics » New waves of price increase to hit Armenia
01 July 2014 [12:43] - Today.Az
Armenia will face the next wave of price increase since July 1, when the oligarchs get out of the shadows.
Under Armenia's PM's ultimatum, the oligarchs, who have been working illegally all these years are expected to stop law violations. On May 14 PM Ovik Abramyan seriously asked oligarchs to start to play the fair play rules warning that he will use his power to deal with irregularities after July 1.
The oligarchs' fair play will further deteriorate the social situation in the country, where one third of the population live in poverty. Furthermore, after the PM's ultimatum, many of the businessmen decided to end their activities and leave the country.
August 1st also will bring high increase of the goods and other services' prices, after the expected increase in electricity tariffs by 10 percent.
Armenia's poor population will not be able to withstand two waves of price increase with a minimum wage which is insufficient for a normal life. The minimum salary in Armenia is 50,000 drams ($120), while the minimum consumer basket is 56,000 drams ($135).
Local media reported that many large companies supplying goods to the markets have already informed their partners that they will submit an invoice. "Some large companies which belong to MP Samvel Aleksanyan have not informed the markets about the invoice," media report said.
Armenia's small economy suffers seriously from monopoly, and oligopolies rule about 60 percent of the shares in Armenia's market, according to the World Bank's report on "Republic of Armenia: Accumulation, Competition, Cooperation", published in November 2013.
The country's big businessmen mainly include MPs and government officials, who are prohibited to conduct business deals based on the constitution.
The civic initiative against the increase in electricity tariffs will hold a rally in front of the building of the Public Services Regulatory Commission on July 1. On this day the commission is expected to adopt a final decision on the electricity tariffs.
Since its formation, PM Abramyan's government has adopted some decisions, which only boost the social dissatisfaction in the country. The government's decisions, which do not meet public demands will lead to inevitable social riots.