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52 Opinion
bne June 2018
Corruption is a cancer, but another driver of dissent has been the underperformance of the economy. There are many arguments to justify the poor economic outcome. Indeed, the Armenian economy suffered heavily during the world
“Armenia has the highest emigration rate in the South Caucasus”
financial crisis of 2008 and was among the most affected countries globally: GDP contracted by around 14%; regional imbalances created additional shocks and there was no relief for ordinary citizens.
It is also a fact that according to data on GDP per capita income (in PPP terms) Armenia is one of the poorest countries of the former Soviet Union. Its economy underperforms even when compared to its immediate neighbours Azerbaijan and Georgia, neither of which are particularly prosperous. That creates a mood-lowering cross-border inequality.
According to World Bank Open Data, in 2016 GDP per capita income in Armenia reached $8,800 while it was $10,000 in
GDP per capita, PPP (current international $)
Georgia and $17,200 in Azerbaijan. In the Legatum Prosperity Index 2017’s sub-component of Economic Quality, Armenia scores 114th out of 149 countries. Such a dire state of affairs would cause instability in any other country, even one with better institutional foundations.
Looking at all these figures, it is no wonder that Sargsyan was ousted by a popular uprising that gained such a head
of steam. Pashinian appeared at the right time, in the right place and, armed with his personal charisma and open mind, he had the right message. It is not rocket science to understand what the country needs now. Armenia must seek a way out of the developmental crisis in which it has been languishing for years. Fighting corruption, cutting governmental red tape, removing the informal controls over businesses and delivering equal justice for all can ensure Armenia turns into one of the most successful countries
in the wider region. And this can happen very fast if the politicians will only allow it.
Kakha Baindurashvili is an economist and former finance minister of Georgia. Currently, he works for non-governmental international organisation World SME Forum (www.worldsmeforum.org).
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