Azerbaijan’s aggression, and especially the recent events in Yeraskh, cannot affect the financial market of the Republic of Armenia, the CBA Governor Martin Galstyan assured during the discussion of the annual report on the implementation of the 2022 state budget in the parliament.
“After 2020, we have gone through so much, and our instincts are so heightened that we are already trying to take preventive actions to protect the financial system from any potential shock. For example, we forced the banks to add 90 billion to their capital last year, considering the potential dangers that may arise in this region or the world.”
Nairi Sargsyan, the Chairman of the Chamber of Auditors, who was invited to Aravot’s “Areresum” (“Confrontation”) program, said: “Concerning the financial market, the Governor of the Central Bank has said some truth and so far there are no such impulses that can have a certain impact. But they not only can have an impact, but already had it on the economic situation, and they have worsened the economic situation; at least the predictable economic future is very vague.”
Referring to the Central Bank’s policy to protect the financial market from shocks, Nairi Sargsyan said: “It corresponds to the reality to some extent because last year, in many cases, we constantly witnessed the increase of the refinancing rate, which was a very wrong decision in the situation of this or 2022.
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Why it was wrong, the inflation in 2022 was supply driven, which means that the refinancing rate could not have a positive effect but had a negative impact. In other words, on the one hand, we had inflation coming from the outside world; on the other hand, an increase in the price of money in the RA territory. We compressed the economic environment and brought it to the point that businesses did not conduct additional investments and policies for further expansion.
This about the Central Bank, here the criticism is inferior to the criticism of the government because they, in any case, have a certain professionalism. And for the economic situation, security and stability is the number 1 component. And after that, we can already talk about economic stability or, even more, development.
Vahe Vardanyan, the other program guest, economist and “Aprelu Yerkir” party Council member, added. “Security is the most important indicator for the economy and has the greatest impact on the expectations of businessmen… The government should mitigate negative expectations as much as possible and give more positive impulses to entrepreneurs and the population to act based on positive expectations.
But in any case, I see a considerable risk, and not only in terms of foreign but also domestic investments, that security issues will hinder and hinder both foreign and domestic investments.”
Anna ISRAYELYAN
