There are no companies in Armenia enjoying an artificial monopoly on lucrative forms of business, Minister for Economic Development and Investments Suren Karayan claimed on Wednesday.
“There are only natural monopolies in Armenia,” Karayan said in a clear reference to utility firms. “In other areas, there may only be companies holding dominant positions. That is the result of the small size of Armenia’s economy.”
“I can state for certain that the market is open,” he told a news conference.
Some types of business in the country, notably imports of fuel and basic foodstuffs, have long been controlled by a handful of companies belonging to influential businesspeople close to the government. Local and foreign economists say the resulting lack of competition in those sectors hampers faster economic growth.
A World Bank survey released in 2013 said that “oligopolies” control 68 percent of economic activity in Armenia, making it the most monopolized economy in the former Soviet Union.
Prime Minister Karen Karapetian seemed to acknowledge the problem after he took over Armenia’s government in September. He declared that “every citizen of Armenia can import any product without a hurdle.”
The State Revenue Committee (SRC), which comprises the national tax and customs services, said last month that “new economic entities emerged in the area of imports.” In particular, at least two new companies are known to have started importing fuel and bananas of late. The SRC said it has stepped in after the banana importer claimed other individuals, not named by the government agency, tried to obstruct its cargo shipments.
Karayan did not list anti-trust measures among concrete actions which the government plans to take for the purpose of improving the domestic business environment. He said the government will specifically strive to further improve Armenia’s position in another World Bank survey that gauges the ease of doing business around the world.
Armenia ranked 38th out of 190 nations that were covered by the 2017 Doing Business survey released this fall. The bank found improvements in two of its ten categories used for evaluating investment climates: “Getting credit” and “Enforcing contracts.”
In Karayan’s words, the government will target four other World Bank categories where Armenia continues to score poorly: “Paying taxes,” “Resolving insolvency,” “Dealing with construction permits,” and “Getting electricity.”
“We have planned measure that will be taken in these four areas so that doing business in Armenia becomes more simple and easier,” said the minister, who was appointed in early October.
Armenia’s position in the World Bank ranks has already improved considerably in the last several years. However, economic growth in the country has been slow ever since the 2008-2009 global financial crisis.