A cabinet reshuffle initiated by President Serzh Sarkisian last spring has contributed to a further deterioration of Armenia’s position in global “economic freedom” rankings drawn up by two conservative U.S. institutions.
“The Wall Street Journal” and the Heritage Foundation think-tank rate 178 countries and territories on ten indicators of economic freedom, including the rule of law, the size of government and market openness.
Armenia retained the status of a “moderately free” economy in their 2015 Index of Economic Freedom released on Wednesday. However, it is 52nd in the latest WSJ/Heritage rankings, down from 41st and 38th places it occupied in 2014 and 2013 respectively.
The survey attributed the drop to a “considerable deterioration in property rights, labor freedom, and monetary freedom.” It also cited the unexpected April 2014 resignations of Prime Minister Tigran Sarkisian and several liberal economists that held senior posts in his cabinet.
“In 2014, the president dismissed several well-known reformers and formed a new cabinet including officials who allegedly have grown wealthy from their government connections,” said the survey. “For example, the finance minister [Gagik Khachatrian] has long been subject to media allegations of corruption.”
“The judicial system, hobbled by corruption, impedes the enforcement of contracts. Scores for rule of law are below average,” it added.
Hayk Gevorgian, a veteran journalist with the “Haykakan Zhamanak” daily who has long reported on Khachatrian’s extensive business interests, described the reference to the Armenian minister as “remarkable.” He said the problems highlighted by the WSJ/Heritage researchers stem from the country’s flawed political system.
“I’m not surprised with the worsening of Armenia’s ratings,” Gevorgian told RFE/RL’s Armenian service (Azatutyun.am). “I’m surprised that they had gone up before in the first place.”
The U.S. survey noted that Armenia still “performs relatively well in most categories compared to world averages.” But it said economic freedom in the country “has been on a five-year downward path.”