Gagik Tsarukian, a wealthy businessman leading the opposition Prosperous Armenia Party (BHK), made clear on Monday that he will not pay the wages of those of his employees who have been put on leave because of the coronavirus outbreak.
Tsarukian also criticized the Armenian government’s efforts to mitigate negative economic consequences of the unprecedented health crisis.
Earlier this month the government declared a state of emergency and restricted some forms of economic activity in Armenia in an effort to contain the spread of the deadly COVID-19 virus. This has led to the complete or partial closure of many businesses whose workers have been sent on unpaid leave as a result.
Some of those firms, notably a large casino located just outside Yerevan, are part of Tsarukian’s Multi Group. Tsarukian said that paying its workers’ wages is the government’s duty, not his. The government should also stop collecting taxes from the casino, he said.
“Why should I pay them?” Tsarukian told reporters. “The state decided to declare a state of emergency and it must [pay] its people … like the father of a family has to give money to those who don’t work.”
The BHK leader insisted that most Armenian businesses gravely affected by the coronavirus crisis cannot afford to compensate their workers for the stoppage. He claimed that the Armenian economy is already “on the brink of a precipice.”
“Mr. Tsarukian warned you two months ago that there are signs of an economic crisis and steps must be taken so that we don’t end up in deadlock,” he said. “If Tsarukian’s statements had been heeded and precautionary work had been done, things would not have been like this.”
Armenia -- An empty street cafe in Yerevan, March 15, 2020.
Tsarukian also dismissed an economic stimulus package unveiled by the government last week, saying that it can only benefit a fraction of Armenian businesses. “If Tsarukian had power he would have made sure that all this is over,” said the tycoon.
The government plans to inject 150 billion drams (just over $300 million) into the domestic economy mainly in the form of loan subsidies for troubled but viable businesses and extra social spending. Prime Minister Nikol Pashinian again touted these measures in a video address to the nation broadcast on Facebook late on Sunday.
“Amid the coronavirus-driven economic crisis the banking system may not be inclined to lend money because that could be deemed risky,” he said. “In order to solve this problem we have decided that the government will take part in such financing and will finance from 30 percent to 50-60 percent of various [business] projects.”
Pashinian said the government will pay particular attention to new projects in the agricultural and agribusiness sectors because it believes global demand for foodstuffs will remain strong despite the coronavirus pandemic.
He further announced that Armenians losing their jobs because of the crisis will be eligible for poverty benefits currently paid to low-income families.
According to a Heriknaz Tigranian, a parliament deputy from Pashinian’s My Step bloc, the government has also drafted legislation that will require private employees to pay their workers remaining on leave monthly equivalents of the national minimum wage currently set at 68,000 drams.