Former Armenian Deputy Prime Minister questions impact of Western aid on economy

In a recent statement, Former Armenian Deputy Prime Minister Vache Gabrielyan cast doubt on the transformative potential of the financial aid pledged by the West to Armenia.

Gabrielyan expressed skepticism that the promised $65 million from the United States and €270 million from the European Union, totaling approximately $330 million, could significantly impact Armenia's economy.

"The total investment of 330 million euros promised by the EU and the United States following the results of the Brussels summit on April 5 cannot achieve the goal set by the EU and the United States - diversification of Armenia's economy," Gabrielyan stated in remarks to Armenian media, Caliber.Az reports.

The summit, held in Brussels with the theme of "supporting democratic reforms and economic stability in Armenia," was met with some disappointment among Armenians. Many had hoped for more substantial outcomes from the event, viewing it as a pivotal moment in determining the country's future foreign policy direction.

Gabrielyan compared the Western financial allocation to the budget of Armenia's Ministry of Economy, which currently stands at around $200 million. "If we just look at the budget of the Armenian Ministry of Economy, which is about 80-90 billion drams (over $200 million), we can say that the government is already allocating quite significant funds on a local scale for the diversification of the economy," Gabrielyan noted.

Highlighting the timeframe of the aid disbursement, which will be spread over the next four years, Gabrielyan emphasized the need for a nuanced understanding of these figures. "The government allocates such funds per year, while it speaks about the next four years. In this regard, it can be stated that from the point of view of our current activities, it does not bring significant additions," he explained.

Expressing uncertainty about the specifics of the projects to be funded by the EU and US grants, Gabrielyan raised questions about their potential impact. "Especially since we don't know anything about the conditions of these grant funds. It is possible that their condition is the mandatory purchase of Western technologies, it is possible that this grant will not have such restrictions," he remarked.

Gabrielyan also voiced concerns about the effectiveness of the allocated funds in terms of diversifying Armenia's economy. He pointed out that the funds will not be directed to the state budget for redistribution to priority sectors. "That is, we should not assume that this 270 million will be given to one or two people, it will be given to many economic entities," Gabrielyan stated.

In conclusion, while acknowledging the positive step of Western financial support, Gabrielyan cautioned against expecting a substantial immediate impact on the Armenian economy. "Although it is not bad that such funds are allocated, we should not expect a high effect," he added.