Notes From Hairenik
I was invited by Artur Papyan of the Yerevan Press Club and the Armenian Observer Blog to participate in the round-table discussion/forum, "Diaspora input into the development of Armenia," which was initiated by the World Bank Armenia Office and conducted late this morning. Participants included professionals, lawyers, and economic advisers from both the diaspora living here as well as a few from Armenia. Essentially it was a two-hour brainstorming session about what businessmen from the Armenian Diaspora could/should be doing regarding Armenia's economic development and how to overcome the obstacles preventing significant investment from happening. There were vital issues discussed during the meeting, notably the lack of trust between Armenians from the diaspora and those from Armenia. Actually, that lack of trust issue was raised by 10 different participants, myself included, as it is the most hindering since without mutual trust and understanding nothing will ever get accomplished regarding strengthening/stabillizing Armenia economically by tapping into the deep Diasporan pool of resources. The following list notes some points which were made in no particular order of importance.

  • Armenians from Armenia need to get more involved in engaging those from the diaspora.
  • The Armenian government must be more sincere in its approach to reach out to the diaspora and engage it.
  • Company registration needs to simplify--currently at least seven forms have to be sealed and filed and endless red tape has to be unraveled; the system is inefficient.
  • The customs service and management structure doesn't work properly and impedes imports of goods for sale by businesses in Armenia. According to one economist present an estimated 46 cents from every dollar in paid customs duties is given as bribes.
  • The Armenian government makes it impossible for businesses to work legitimately and does all it can to make money by imposing the payment of bribes and ambiguous fees.
  • There has been obvious careless, misguided legal reform in Armenia initiated by the World Bank; however, what will it do to fix those mistakes?
  • Armenian society has stagnated. People who want change are marginalized, persecuted, or both. The go-with-the-flow mentality reigns supreme, with people believing that there is no point in enacting change since nothing will change.
  • Armenians in the diaspora are considered cash-cows and are to be milked then sent packing. There are incidentally several horror stories to he heard, most notably the tragic Najarian case which Hetq Online has covered substantially.
  • People who leave the country to be educated must return and should be given incentives to work in the government and thus work for change within.
  • The Armenian Diaspora's role is limited in a society/government run by opportunists and thugs commonly identified by their nicknames (case in point: Hovik Abrahamyan, who is known as "Moog" or Mouse and controls most of the Syunik region, is expected to become the next speaker of parliament).
  • Armenians are not unified anywhere in the world, particularly in their own rural communities, which is a huge impediment in Armenia-Diaspora relations and potential undertakings.
  • The Armenian government and the laws of the country needs to be streamlined. The government must be shrunk down to effectively function within the fiscal limitations of the state budget.
  • The laws of Armenia do not work and the judicial system is severely flawed.
  • The Armenian tax service is inefficient, incompetent, and corrupt (a common practice: a state audit of a small business is initiated--when an insignificant issue is found it is exploited in an attempt by the tax authorities to receive a bribe payment so they will go away). Transparency is needed.
  • Armenians need to know more English, as there is a notable weak stream of information entering Armenia from the West.

These types of forums are of course nothing new. Notably, three Armenia Diaspora conferences have been held in Yerevan in the last 10 years, and although many problems were identified similar if not identical to the ones listed above each time there was no follow-up and thus, no action. In some respects regarding governmental red tape and bribe extortion, problems are a lot worse than they were a decade ago. There has been as far as I can tell no real improvements in Armenia-Diaspora relations in the four years I have been living here non-stop. I have seen one business close run by an Armenian diasporan to be replaced by another, and I only know of a handful of businesses which are run by Armenians from abroad. Other diasporan-run businesses have shut down altogether and I have no idea what happened to the owners in terms of their professional interests. But I do not believe that the World Bank representative who was the co-moderator of the session has taken away anything of real importance from the discussion for use to change the bank's policies regarding how to properly fund the Armenian government. 

Fostering ties with the Armenian Diaspora is a full-time job. It will take the initiative and undertaking of some kind of governmental agency--perhaps the newly created yet ambiguous "Armenian Diaspora Ministry"--run by young Armenian citizens who were educated and trained professionally in the West because no one else will be able to do it quite simply, especially those churning through life fueled by their Soviet-era mentalities and best practices. You need to know how to communicate with and think like people from the West in order to reach out to them, and most importantly, listen to them to incorporate the ideas and knowledge they possess in market development. Until the Armenian government and World Bank understand this, they should not expect much from the Armenian Diaspora regarding increased investment in the country. Actually, there is no reason to believe they don't already understand that.

This just in: Armenia has slid in its corruption ranking from 99th place last year to 109th place. The study is conducted every year by Transparency International. On a scale from 1 to 10, Armenia's score is 2.9, down from 3.0 a year ago. Read more here.

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2 Comments:
Blogger Raffi said...
I agree with most of what is written here.

Armenia is a great vacation place, but not yet for living and specially for business.

However, this is our motherland, and every Armenian, who loves Armenia needs to support. And many are already doing their part. I hope the government does its part too.

Blogger nazarian said...
Looks like Armenia has no interest in attracting Diaspora capital and know-how.

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