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Speeches, Statements

Thursday, 20 October 2016

Remarks by Prime Minister Karen Karapetyan, delivered while introducing the Program of Government to the National Assembly of the Republic of Armenia

Honorable National Assembly Speaker,
Dear Members of Parliament,

I am thanking you for giving the opportunity to present the Program of the Government of the Republic of Armenia - a program that reflects our team’s vision of Armenia’s development.

I would like to stress that during the drafting of this program of activities, we have had a lot of meetings and substantive discussions with Armenia’s former prime ministers, ministers, renowned State and political figures, Armenian and foreign economists, experts, business representatives and individuals from the wider society. Detailed discussions have been held with the RPA and the Armenian Revolutionary Federation.

The Program of the Government is a comprehensive action plan with specified deadlines. In my speech I will only focus on a number of provisions as the full text of program is available for your consideration.

The Government of the Republic of Armenia aims to implement reforms in order to achieve the following enhancements for our citizens who are the country’s supreme value:
• Protection
• dignity
• higher standard of living
• social justice
• optimism for the future

These goals are of paramount importance and always have specific manifestations. The Government’s task is to identify the obstacles and find effective solutions. We have now entered a new phase of regional development, which implies a lower rate of economic growth in our immediate economic partners, which checks the general trends-based rapid growth opportunities.

In this environment, the existing structure of the economy of Armenia cannot ensure progress in developing standard approaches to the rates that are consistent with our challenges. It is necessary to thoroughly analyze and reinterpret our approaches and ideas in terms of economic development and, especially public administration, economic development trends, statistical basis of accounting, economic potential, competition and competitiveness.

To this very end, the Government has already set the task to carry out an accurate diagnosis of the management system and the economic situation, as well as an objective analysis of the most important problems and propose short-term measures and long-term strategic reform programs. To develop long-term strategic plans a center of strategic initiatives under the Government of the Republic of Armenia will be operational, where the problem shall be dealt with by leading specialists and experts from Armenia, the Diaspora and foreign countries.

I would like to highlight some of the strategic tasks of the government. The number one task is the defense capacity and security of our country. The security threats facing our State make it necessary for us to build up an efficient, constantly improving and modernizing public defense system, which should enjoy the confidence and support of the society. We assure you that the government will spare no effort and means to neutralize the military threats against Armenia and Artsakh, build up sufficient military capabilities for the creation and maintenance of military balance in the region.

Another important task is the implementation of the 2015 amendments made to the Constitution of the Republic of Armenia. We must make consistent efforts to ensure the further development of democratic institutions, increase confidence in political processes and institutions. Without the confidence of our citizens in the political institutions, without the active participation of our citizens, we cannot create a fair and competitive environment; we cannot provide optimism for the future.

We must do everything to consistently shape and cherish a middle class with stable and active civic position. Only through the joint efforts of all stakeholders we can resolve the problems we face. The government should lead these efforts. The reforms must begin in the government. We must revitalize the State governance and local administration systems, making them modern, flexible and efficient ones. We need to ensure maximum results at minimum cost through sanitation measures.

The first condition for public administration system’s efficiency is to be corruption-free. This is much talked about. But what matters most is to take specific actions, and I am confident that the public will feel the appropriate signals coming from the government. A balanced distribution of powers is critical for effective functioning of these systems.

Collegial authorities are needed only for solving the most important strategic issues. Government members should be entrusted with sufficient powers and responsibility in the appropriate sectors.

Decision making should be objective, less bureaucratic, simple and targeted at all levels of the State apparatus. We should know why a decision is accepted or not, who is responsible for delays so that we can effectively solve the problems of citizens in a short time.

We will promote good governance and reduce corruption risks through close public-private partnerships at the local government level by supporting the elected bodies to effectively control or dispose of their commercial potential of the private institutions, ensuring good quality and availability.

We will possibly switch to systems based on the one-stop-shop principle in providing services to citizens and businesses, reducing the time and effort that they spend dealing with government bureaucracy.

The system of governance needs to be continuously monitored on unnecessary procedures and structures in order to identify inefficient or redundant tasks and remove them gradually.

Instead of providing jobs for the staff, public agencies should provide services to our citizens. If not required, ineffective or expensive, these services should be eliminated or converted.

The image of public servant should be changed. It is important for us to remember that public servants are service providers and not sovereign rulers who have inherited their positions. It is important for the citizens to get quality services from public instructions. This is a culture, which will take some time to get inculcated; however, steps must be taken today.

Many programs need to be reviewed and rethought. The situation changes over time, and we have to analyze and demonstrate a special attitude towards those programs not producing added value, including the consideration of their effectiveness for the attraction of credit resources.

The reform of the system of State and foreign-funded procurements is simply to create a fair and transparent procurement system. The government will introduce a uniform system of public procurement to reduce the risk of corruption in public procurements and increase the degree of social control.
This project will be part of a greater Electronic Armenia or e-Government program, which is seen as an imperative in almost all developed countries of the world in the era of information technology.

It should be noted that public administration reform is necessary, but not sufficient for the country’s development. Daily work is to be carried out in and outside the official cabinets mediating diversified contacts in order to ensure economic development and create jobs.

Dear Members of Parliament,

The analysis of the economic situation indicates that it is extremely complicated to ensure development through standard tools and methods. In view of the above, we need to:
• reveal and remove all of the investment and excessive administrative barriers and procedures that impede business development,
• assume the function of the promoter of investment activity in our country and directly participate in the implementation of key investment projects for Armenia,
• work with international investors in order to demonstrate that it is safe and profitable to do business and make investment in Armenia.

In a bid to ensure sustained economic growth, the Government adheres to the ideology of liberal economy, and increased exports are seen as the main outlook for economic growth.

According to international ratings, only those countries are deemed to be happy in the world where there are more favorable conditions for entrepreneurship. What matters most is not to have important oil, gas and other natural resources, but to offer people the opportunity of revealing their creative abilities. Our primary business objective is to ensure free and fair competition environment.

Tax and customs administration has always been the focus of public debates. We must develop such rules of the game that would create more favorable conditions for the activities of law-abiding taxpayers.

We must begin to implement a program of radical transformation of the image of tax and customs officers. The citizens of the Republic of Armenia should know that the tax and customs authorities are not in control of their lives life, but provide public services. The one-stop-shop principle will be introduced in the system of customs administration.

Everything will be done to increase business efficiency, service quality and save time. The work of tax authorities should go unnoticed for law-abiding entities; personal contacts should be minimized.

Self-employed people need to be given an extra-privileged status. They should be free from immediate contacts with tax officers. At the same time, the law-abiding entity should be aware that its activities are targeted by the tax department; that he is subjected to monitoring with various tools and that tax evasion cannot be without consequences. However, both tax and customs control should be exercised strictly within the bounds of the applicable law.

We will reveal and prosecute any instance of excess authority by law enforcement bodies. In addition, businesses should be confident that they can resolve disputes with mutual negotiations and in inexpensive formats, and can be prosecuted only for offenses of fraud implying serious public danger.

As described above, the tax and customs administration should be based on minimum contacts with the business involved. In particular, we are planning to simplify and fully switch to an electronic reporting system, reconsider the criteria for assessing the degree of risk of taxpayers in order to make inspections more targeted and efficient, as well as carry out many other activities.

Businesses often complain about the so-called reference prices. To drastically reduce this practice, we will switch to the system of customs clearing based on invoice-specified prices in case of export declaration documents available from no-risk countries. In the meantime, we will reduce the number of references due from other State agencies.

To better the business environment, we are planning to reduce the list of permits and licenses required for certain types of business activities, simplify the procedures for granting, as well as to complete at least 6 proposed amendments to inspection functions in 2017.

Dear Members of Parliament,

Given our country’s geopolitical situation and peculiarities, we can say that the current round of reforms is not just enough to provide equal conditions. At this stage, the government must take up, at least temporarily, the function of the promoter of investment activities and jobs in order to get involved through various tools in key investment projects in Armenia.

For this very reason, we will set up a special investment fund, which will contribute to the rapid formation and development of economic projects in Armenia.

We are also planning in this area:
• work on improving the investment legislation,
• enhance the efficiency of those entities’ operations aimed at increased economic activity,
• make an inventory of unused production capacity, develop specific mechanisms to promote their rehabilitation,
• Implement practical steps in 2017 in order to improve by at least 4 points Armenia’s doing business standing in the reports of international rating organizations.

The improvement of the business environment is a permanent and continuous function. In this regard, the most important task is to continuously monitor, detect, and eliminate the legal norms and practices that impede economic activity. Business community should not only be kept regularly informed of these activities, but also take an active part in the reform process.

It is especially important to get small and medium enterprises involved in this work, as well as to create real support opportunities for them. Each businessman will have the possibility to communicate directly via a hot line with the Ministry of Economic Development and Investment.

The official website of the government will feature information about those responsible for the administration, through which businesses can address questions to the Prime Minister. Be sure that no request will remain unanswered.

Efforts will be made to create a favorable legal and investment environment for such newly established and innovative production chains as may create maximum added value, including small and medium-sized enterprises.

We will encourage certain types of business (e.g., greenhouse farms, agricultural processing entities) by means of preferential energy tariffs effective for a limited period of time. New job-extensive enterprises shall be supported through tax incentives and preferential energy prices.

We will focus on tourism industry, which is exercising a multiplier effect on the economy. The newly formed Committee for Tourism will enhance Armenia’s tourism attractiveness and take steps to substantially increase the influx of tourists.

We will launch budget flights to Armenia, particularly directing them towards the Gyumri airport. Being the backbone of economic activity, industrial infrastructure will be the center of our attention. We shall strive for a new quality in the energy system through active trade relations in the regional energy market.

We shall consistently build up Armenia’s lifeline foreign trade capacity by developing our country’s communications and supporting the IT sector. The government program focuses on the more important aspects of this.

Greater attention will be paid to those most urgent problems which affect our people’s daily life. In particular, we will continue to work in the disaster zone: in 2017, we will fully complete the State housing program in Gyumri.

I would like to mention that the government is committed to deepening cooperation with the Republic of Nagorno-Karabakh and dealing with the issues aimed at the economic empowerment of Nagorno-Karabakh.

The government is set to provide active support to enterprises for export promotion. In particular, we will be consistently monitoring the regulations applicable in this area in a bid to identify and remove the existing administrative barriers.

As from 2017, we shall introduce new tools and improved insurance mechanisms against currency risks, as well as provide such export incentives that will be phased in the manner to reduce the value added tax return deadlines with simplified procedures.

The mining industry, which boasts an important export share, will be the focus of our attention. We shall endeavor to enhance the sector’s viability and increase the number of quality jobs. Those enterprises bringing important added value into the market will be supported through preferential tariffs for additional volumes of natural gas.

Dear Members of Parliament,

At first glance it may seem that the government program is focused on economic measures. We have discussed and submitted to you numerous activities in the field of foreign policy, defense, public order and social protection.

The emphasis on the economy is caused by the belief that sustainable economic development is the key to addressing poverty and unemployment. This accounts for the focus on the creation of free, fair and competitive economic conditions. Inclusive economic growth is the best remedy against social polarization, which we intend to pursue in parallel to numerous measures in socio-economic sphere.

In particular, proceeding from the need to provide for social justice, the government’s priority is to ensure the targeting of social assistance.

To this end, we are planning to pay lump-sum benefits, pensions, and family allowances based on online applications starting from 2017, while the vulnerable groups will be supported by means of preferential natural gas and electricity tariffs.

We are going to implement a gradual introduction of electronic systems for the monitoring and evaluation of services in social protection programs.
The main goal in the healthcare system is to increase the patients’ possibility of choosing a medical facility, which will help improve the quality of service at reasonable prices. In particular, under the State-funded treatment facility, we will switch from the pre-financing system toward the post-paid system to provide a more effective and personalized treatment to patients. To this end, we envisage the gradual introduction of electronic health information system to allow patients immediate access to all documents and optimize the performance of hospitals.

By combining this system with the international best practices-compliant clinical guidelines and practices, we will be able to enhance transparency and effectiveness in the State order placement process.

In the sphere of education and science, our goal is to enable everyone to get quality education and practical skills. We shall pay special attention to children living in rural communities.

Note that many of our talented compatriots were born and raised in rural areas and small towns. If we fail to provide them with high-quality educational opportunities, we will rob our future. We will provide access to high-quality video lessons authored by best foreign specialists and teachers from across the country.

We will carry out a review of education programs, with special emphasis on obtaining practical knowledge and develop critical thinking.

Entrepreneurship and financial education programs shall be introduced in schools, possibly increasing the share of natural sciences, mathematics and foreign language classes.

Significant steps will be made in the system of higher education towards the quality of education and labor market access of young people to increase their professional skills and scientific training. Through the creation of networked universities and scientific centers, we shall lay the foundations for ensuring the cooperation of universities and research institutions in 2017.

In our relations with the Diaspora, a special focus will be placed on Armenia’s being the center of all Armenians, the homeland of all Armenians. In this direction, we are going to implement projects aimed at the social integration of Iraqi and Syrian Armenian, as well as develop identity preservation projects jointly with the pan-Armenian structures.

Of particular importance is the use of the Diaspora’s potential in the field of public-private cooperation. In many areas our Diaspora compatriots have a wealth of experience and knowledge, the mutually beneficial use of which can create new social qualities, bring forward new ideas and a new working culture to create a global competitive products and services.

The government will initiate steps and projects involving the Diaspora’s business potential. It is also important for our compatriots in the Diaspora to get one-stop-shop consulting services. Our basic problem in the field of knowledge us the preservation of national cultural values, while being open to other cultures and ready to adopt best values.

Our centuries-old history shows that based on openness and tolerance towards others’ values, cultural contacts have enriched our culture to become more vibrant and powerful. To encourage international contacts, we are going to support and promote the development of international youth cooperation and youth mobility.

It is important not only to take over from the outer world, but also to give back to the world. Armenia attaches great importance to the preservation of cultural awareness and economic promotion of the use of cultural heritage and cultural values. To this end, in 2017 we are planning to create virtual information systems in the museums.

We attach importance to the implementation of targeted programs aimed at developing the creative skills of gifted children and youth, creating favorable conditions for ethnic minorities to represent their national culture, as well as language assistance for the publication of books and periodicals.

Our task in the field of environmental protection is the conservation of Armenia’s unique wildlife and hand it down to the future generations. In particular, we are planning to strengthen control over the exploitation of mineral resources the reproduction of natural resources.

It is extremely important for the society to abide by a healthy lifestyle and promote mass sport. Every day the number of people engaged in sports and exercise should increase in our country. For this purpose, are going to develop a national program of promotion mass sport and a healthy lifestyle.

We will advocate and introduce modern approaches and requirements of a healthy lifestyle in academic programs. Physical education lessons should be compulsory in every school.

Dear Members of Parliament,

We understand the great responsibility that has been placed on the government. It is obvious that it would be extremely hard to achieve the planned results without the participation of wide sections of our people in the decision making process. We look forward to your assistance and support. We call on our compatriots and all those who are not indifferent to Armenia to get involved and assume an active civic position.

We would appreciate receiving your advice, initiatives and proposals. We urge the media to be more active and objective in covering the government’s activities. As we need your help in presenting our achievements and failures, we shall support the establishment of a free and fair media.

We will be sincere and consistent in our efforts, responsive to criticism, attentive and ready to implement all sound ideas. We invite everyone - investors, professionals, artists, scientists, farmers and laborers – to participate in development projects in Armenia and build the country of our dreams.

We need optimism and determination to proceed to the building of our country. Despair or hopelessness, intolerance towards each other will not be helpful on the way to engineering a strong and attractive country, confidently looking to the future.

I am sure of our people’s optimism and willpower, I am confident that, together, we can overcome any difficulty.

We need to embark upon this honorable mission together, establishing a solid foundation for long-term development of the country. Day after day, we will take steps that will bring us even closer to a more competitive, economically stable, powerful and just homeland based on national values.

I am confident that success will come with hard work and selfless dedication.

Thank you.