Government ready to stimulate emigration
Business Innovation Forum was launched in Dilijan yesterday. PM Tigran Sargsyan participated in the forum, where he made a speech on the IT sector in Armenia and prospects of development.
PM Tigran Sargsyan said that the IT sector produces 5% of Armenia’s GDP and its volume is equal to the mining sector in Armenia. IT sector employs 7,000 professionals. The PM believes in the future the driving force of new vacancies will be through increased professionalism and skills. The PM said that even during the international economic crisis the Armenian IT sector had 28% economic growth.
“We should understand that from the long-term prospective new massive vacancies will be demanded in the sector of Information Technologies. We will have challenges, which primarily will concern professionals and the needed qualifications of specialists. The IT sector challenges our government to provide the availability of at least 2000 specialists a year, which will certainly increase the demand for such professionals. This means that we should change our policies for planning government grants for professions at universities. We are going to take quotas from the faculties of law and economics and transfer it to the IT sector. We are going to direct financial resources of the government to the preparation of IT specialists,” said the head of the government.
The Prime-Minister’s announcement is very interesting. First, it says that since Armenia’s independence we have funded education programs for lawyers and economists more than it was necessary and supplied the market with unjustified numbers of specialists. Even though many of them may not have good qualifications and the only thing they have is their diplomas, still the number of qualified specialists in Armenia is so high that it could meet the demand of Russia for such professions. Now, as the government’s priority in economy is IT sector, the government has decided to sponsor more professionals in this sector.
What is the problem here? The problem is that the IT sector is very actively opposing to the government’s proposed bill to increase the compulsory pension fund payment from 5 to 10% starting from January 2014. People employed in IT sector are receiving the highest salaries which are totally taxable, and they will suffer most from this new law. During the event in Dilijan the PM proudly said that Mentor Graphics Armenia company operates in Armenia and provides 5% of the production volume in micro-chips. However, the fact is that the government does not care about their opinion.
The issue of compulsory pension fund was not discussed at this event, even though 120 IT sector representatives participated in it (or it was not so important for them as it is not reflected in their official statement either). The PM spoke about this topic in a briefing with journalists. Tigran Sargsyan said that the compulsory pension fund had been developed as a result of ten-year work of experienced professionals and discussions. “We have taken into consideration the opinions of our opposition. We want to move forward according to the requirements of laws adopted by our parliament. We are decisive in bringing our reforms to the end,” said Tigran Sargsyan and added that during the adoption of compulsory car insurance policy people used to oppose to it, however in six months they saw the difference.
This means that the government will not step back and the policy of compulsory pension fund collection will be enforced starting January 2014.
In fact the government is concerned of the development of IT sector in Armenia, is initiating reforms to make sure the country has specialists for the sector in the future, but indeed does not take care of the professionals it has now. This is too much. We have published an article in a previous publication writing that the Russian government will have opening for 200,000 IT specialists by 2020. The Armenian IT sector professionals have numerously said that if their demand is not satisfied, they will have to emigrate to work in other countries. One of the directions for IT professionals’ emigration will be Russia. The government either does not take such announcements seriously or thinks that IT professionals are doing so to make pressure on the government. However, the government, as it happens in American movie scenarios, does not give place to pressure and does not compromise.
On the other hand, maybe the government is taking the threats of IT professionals to emigrate seriously. Accordingly, as this scenario could significantly affect the IT sector in Armenia, the government has decided to secure its risks by boosting education in IT.
This would be justified if time did not play a role. This reform will bear fruit in at least 4-5 years. The term for graduation of new applicants for IT education is five years.
If a part of IT professionals in Armenia gives up and emigrates, our country will have deficit of IT sector employees during the coming 4-5 years. This would hamper the prospects of growth. The world is changing very fast, and IT industry is changing even faster. Stagnation of this sector of a couple of years could throw Armenia back for 10-15 years. However, we see that the government’s goal is not good economy with long-term development of 10-15 years but bringing short-term money into the budget (and maybe bank accounts of companies under their patronage).
By Babken Tunyan
