Armenia and the information war

[Mos]

Re: Armenia and the information war

French presidents tend to be rather vocal about Armenian Genocide issue.

....

Nicolas Sarkozy gives Turkey till yearend to recognize Genocide

October 6, 2011 - 19:11 AMT
PanARMENIAN.Net - On the sidelines of his visit to Armenia, French President Nicolas Sarkozy visited Tsitsernakaberd Armenian Genocide Memorial, where he addressed the issue of 1915 massacres in Ottoman Empire.
“Collective negation is a more serious problem than an individual one. Unless Turkey follows the suit of other great nations in recognizing the Armenian Genocide before yearend, France will take serious steps, including criminalization of Genocide denial,” Mr. Sarkozy stressed.
President Sarkozy was further taken for a tour in Armenian Genocide Museum. In the book of records, the President left a message: “France does not forget.”

[Federate]

Re: Armenia and the information war

Relatively recent article about Armenia's debt.
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Armenia’s Increased Debt ‘Under Control’
Armenia - Finance Minister Vache Gabrielian.
30.06.2011
Hovannes Shoghikian

The government insisted on Thursday that Armenia will have no trouble servicing its foreign debt which has more than doubled since 2008 and is on course to total about $3.8 billion this year.

“We have a debt that is considerable for our country and needs to be managed efficiently,” said Finance Minister Vache Gabrielian. “But in terms of stability, it is not controversial.”

Gabrielian spoke to journalists after Prime Minister Tigran Sarkisian’s cabinet approved a debt management strategy for 2012-2014 at a weekly session held in the southeastern town of Yeghegnadzor.

The 15-page document drawn up by the Armenian Ministry of Finance says that the country’s overall public debt will reach $4.3 billion by the end of 2011, up from $3.7 billion in late 2010 and equivalent to 41.3 percent of Gross Domestic Product.

It is projected to total more than $5 billion by 2015. But the debt’s ratio to GDP is to fall to roughly 38 percent.

Gabrielian said that this proportion may well change of because of currency exchange rate fluctuations. “Let’s say that our debt-to-GDP ratio is within a 40-50 percent range,” he added.

The country’s external debt stood at $1.5 billion in late 2008, just before the onset of a global recession that hit the Armenian economy hard.

The Armenian government and Central Bank scrambled to cushion the impact of the crisis with large-scale emergency loans from multilateral institutions like the International Monetary Fund and the World Bank as well as Russia. The anti-crisis borrowing enabled the government to avoid major spending cuts in 2009 when the domestic economy contracted by over 14 percent.

The sharp rise in the debt burden raised concerns about the authorities’ ability to repay it. Hrant Bagratian, a former prime minister and a bitter government critic, claimed in January that they could default on debt repayments in 2013 and 2014.

Finance Ministry officials dismissed those claims. “Armenia is far from facing such risks,” one of Gabrielian’s deputies, Vartan Aramian, told RFE/RL’s Armenian service at the time.

According to the document endorsed by Sarkisian’s cabinet, the government’s overall debt service burden will peak in 2013 at an estimated $225 million.

The government plans to spend about $190 million on external and internal debt servicing this year. This will account for approximately 7 percent of its overall expenditures projected by Armenian’s 2011 state budget.

In a December report, the IMF described the Armenian authorities’ debt repayment capacity as “good.” The fund emphasized in that regard the importance of government plans to cut the budget deficit to 2.5 percent of GDP by the end of 2013.

“The projected debt-to-GDP levels do not appear excessive, and standard stress tests show that Armenia’s public external debt remains sustainable,” said the report.

http://www.azatutyun.am/content/article/24251722.html

[Mos]

Re: Armenia and the information war

Sarkozy is in Armenia

[londontsi]

Re: Armenia and the information war

In the financial trap that America has set up around the world its unfortunately normal for countries to take loans to build themselves up.

People fall in the as you say financial trap is when the loans have been used unwisely.

Armenia also takes loans from Europe and Russia to balance out as diversification.

True, but in the case of Armenia the loans were used to finance an unsustainable consumer boom mainly by supporting the value of the Dram at the expense of the local producer as well the exporter.
This has been highlighted frequently by economics commentators.

The problem is not if they are taking loans the problem is how much and from who.

Not true.
What matters is like any businesses, what is the expected return on the loan.
Then one has to evaluate whether the expected return has been achieved or not.

right now Armenia doesnt have a loan problem.

Not true. They have to be paid back.
When politicians say “Armenia does not have loan problems” what they really mean is, the expectation is it will have to be paid by future generations.

[londontsi]

Re: Armenia and the information war

Relatively recent article about Armenia's debt.
--------------------------------------------------------------------------------------------------------------

Armenia’s Increased Debt ‘Under Control’
Armenia - Finance Minister Vache Gabrielian.
30.06.2011
........

http://www.azatutyun.am/content/article/24251722.html

Under control means as an example,

the house is on fire but there is no danger of the fire spreading the the next house (yet !).

When they say we are able to service the loan it means we are able to pay interest on the loan.
The question is what happens when we cannot pay the interest ...... borrow more .

Followed by crises and political price to pay to the lenders.

.

[Federate]

Re: Armenia and the information war

Interesting link http://en.wikipedia.org/wiki/List_of..._external_debt for comparison of world debt. Armenia's debt amounts to 56% of its GDP.

[londontsi]

Re: Armenia and the information war

Interesting link http://en.wikipedia.org/wiki/List_of..._external_debt for comparison of world debt. Armenia's debt amounts to 56% of its GDP.

This is a ratio that is frequently branded about by politicians.
If you look at it closely it becomes clear it is a meaningless ratio.

If you compare Armenia with Luxemburg you can see what I mean.

To be able to pay external debt it has to export more than it imports.
Excess foreign currency to be used to service and ultimately pay off loans.

We know that the current ratio of imports to exports is about 4:1 against.
Foreign remittances help but not a long term solution. Not healthy way for society.

So the country needs continues loans to pay for this imbalance.

With increased loans the servicing costs increase.

Also remember the meagre income (relatively) Armenia receives has to be used to service loans
rather than be used an already overstretched social necessities etc.

[Tigranakert]

Re: Armenia and the information war

..........

What would you have suggested? In the fragile situation Armenia is in now, and the world economic crisis which affected Armenia significantly, there was no other option. These are risky times in which we can not risk our economy to collapse and the economic situation in Armenia to get worse, as our enemies tighten their grip on us. Indeed, the debt has to be paid by the future generations, and that is why, we, all Armenians, have to do everything we can to make independent Armenia successful and powerful, economically, politically and militarily. I have all the trust that we can accomplish this, and even more.

[Serjik]

Re: Armenia and the information war

While some of the money gets wasted (embezzled which is totally natural it even happens in London), I don't see the loans being used unwisely in Armenia. They are going to the building of infrastructur. Economic commentator are fools and crooks. The econo crisis is proving it.

People fall in the as you say financial trap is when the loans have been used unwisely. True, but in the case of Armenia the loans were used to finance an unsustainable consumer boom mainly by supporting the value of the Dram at the expense of the local producer as well the exporter. This has been highlighted frequently by economics commentators.

The expected return is very low. So don't worry too much bro.

Not true. What matters is like any businesses, what is the expected return on the loan. Then one has to evaluate whether the expected return has been achieved or not.

When I was in Armenia my family invited a young man that worked in the finance ministry to our house. After a few shots of vodka he spilled the beans. LOL He said they are borrowing as much as they can to build infrastructur and line pockets because they are knowing that in a few years the whole thing is going to fall apart and Armenia is going to join the Russian ruble zone and free itself from the western debt. The loans get paid back by those under Western rule. Armenia is not under them. These guys in Yerevan are not straight arrows but they know what they are doing. Trust me bro.

Not true. They have to be paid back. When politicians say “Armenia does not have loan problems” what they really mean is, the expectation is it will have to be paid by future generations.

[londontsi]

Re: Armenia and the information war

What would you have suggested?

I have already given my point of view but I shall repeat.

Like any business before you borrow you look at how the money will be spent, what will be the return on the loans.
If its borrowed on behalf of the Nation then you state to the people where these funds will be used and what benefits will be obtained.

Based on promises and results obtained judgements are passed, through elections, financial reporters commenting, international praises etc.
In our case the money was/is used to finance IMPORTERS against local producers and exporters.

I am not against raising finance. There is no country in the world that does not raise finance.
What I am against is when the Country’s or the Nation’s future is mortgaged and the money is wasted inappropriately.

In the fragile situation Armenia is in now, and the world economic crisis which affected Armenia significantly, there was no other option.

It has nothing to do with economic crisis.
Armenia has been building its national debt well before then.

These are risky times in which we can not risk our economy to collapse and the economic situation in Armenia to get worse, as our enemies tighten their grip on us.

Nobody is tightening its grip on us. It has been as tight as they could, from day one.
They cannot make it any tighter because time has shown it is a failed policy.

Armenia’s future will always be risky due to the type of neighbours it has.
However Armenia has never been as “safe” as it is now, mainly due to its Army.

Our enemy's hope is that we destroy ourselves from within.
If we (the people) are not vigilant that could happen, due to corruption, incompetence, undemocratic governance leading to infighting etc..
Running a healthy economy is also one of the pillars of safe and secure country.

Indeed, the debt has to be paid by the future generations, and that is why, we, all Armenians, have to do everything we can to make independent Armenia successful and powerful, economically, politically and militarily.

I do not understand why you say we all Armenians.
Clearly results will be obtained based on the decisions of the decision makers.
They should be accountable to the people.
People have every right to protest if they see things are not as they should be.
That is how democracy works.

I have all the trust that we can accomplish this, and even more.

Like what?