“A defective Prime-Minister is an unacceptable price that our country cannot afford”

Robert Kocharian’s interview with www.2rd.am

-Mr. President, as New Year and Christmas are approaching, the society is discussing PM Tigran Sargsyan’s recent interview. Were there any statements or announcements in the PM’s interview that caught your attention?

-I’d like to focus on a point concerning the continuous slump in the construction sector of Armenia. As the Prime-Minister’s explanation has nothing to do with the reality (like many other statements in that interview), I will try to answer that question myself.

Why does the sector of construction continue falling after a five-year slump?

1. Massive emigration trend of Armenia’s population (I am not mentioning the numbers not to make people sad on the threshold of this holiday season): People who flee out are potential buyers of real estate, thus it contributes to the reduction of demand in the real estate market. In addition to that, a part of the properties of people that emigrate is offered in the secondary market, which is extra supply in the market. The reduced demand and prices for real estate have seriously affected the sector of construction. Due to these reasons the effect of stretched demand for real estate does not work after the economic crisis in 2009.

2. Worse conditions for mortgage credits (if it is still possible to call it a “mortgage credit condition”): Let’s simply compare the conditions offered in 2004-2007 and now. You will see that only a few people with reasonable thinking would agree to borrow such “mortgage credit.” Banks have not fault for this. They have to respond to the economic circumstances and disputable liquidity of bailed properties this way. Let’s add to this the increased number of poor people in the country, who cannot even afford to dream of an apartment or mortgage credit.

3. The mood of our residents: The feeling of apathy, desperateness, a lack of faith to the future of the country have grown so much that they become factors influencing on people’s motivation. Research publications report that 40 per cent of the population are willing to permanently emigrate to any country they can. People who have plans to emigrate never buy real estate properties in the city or country they want to leave. The same is true about new businesses.

These are the main reasons for stable reduction of the volume of construction projects in Armenia. Everything is very simple and understandable (but not for people that have “exclusive talent”). This is not the fault of the previous government or aliens. It is a long time that the crisis has nothing to do with this either. It is impossible to avoid liability. If the Prime-Minister does not understand this, it means he is having a degradation of intelligence. If he understands it and lies on purpose, trying to put the blame on me and Andranik Margaryan’s government, it is a degradation of morality. Probably we are dealing with a combination of both intelligence and morality degradation. In any case, a defective Prime-Minister is an unacceptable price that our country cannot afford.

P.S. Probably soon little dogs in service will start barking at me. I wonder if they will do it before or after the New Year holidays.