11, 2011

Statement by President Serzh Sargsyan at the Convention of the Armenian Union of Industrialists and Entrepreneurs

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Distinguished Businessmen,
Ladies and Gentlemen:

I salute you and I am glad to participate at the Convention of the Armenian Union of Industrialists and Entrepreneurs. This is an excellent opportunity to recap and assess what has already been done. However, discussions of future programs and precise definition of our problems are even more important.

Search for the answers of “How do we use our potential - capacities, knowledge and experience?” has always been, is and will be present in our reality. The answer to this question is important for our advancement, so that our national aspirations are fulfilled, so that we find and assert our own place and role in the global community of developed nations. Our goal is to create a well-organized and self-assured society, focused on the needs of human beings. We should become a society which creates utmost conditions to reveal creative abilities of individuals. This is a lasting goal, because each and every of our achievements will present new demands. It is quite natural and it is a driving force behind progress.

How to accelerate our movement toward that goal, to make bigger steps toward giving people a more dignified and prosperous life, as well as total freedom for self-realization? Input from all forces into this task is important, everyone’s role is exceptional. The mission of resource consolidation and creation of new values is reserved to entrepreneurs. Businessmen invest their talent, ingenuity, capital and take risks creating jobs, employment and income. And finally, the issue of formation, strengthening and creation of new business culture is also reserved to your community.

Geographical peculiarities of our country in a sense objectively restrain development of entrepreneurship and the range of activities. As a rule, small internal markets are limited to the minimal amounts necessary for production and supply and trim down economic productivity. It’s a reality, however we have no right to give in to this or any other similar obstacle. We should be able to push expansion and development of the Armenian production and enterprises not only toward internal but also external, i.e. global markets.

External markets are immensely large and thus should become a constant target of our economic growth and development. It is true that export demands organization of modern production lines which comprise complex and multifarious chain of asset creation. People with new knowledge and abilities are important to us; we will need new qualified labor force, new technologies and, certainly, new investments.

Private market entrepreneurship is actually a new phenomenon in Armenia. There are also new modern institutions, structures and sub-infrastructure which provide financial and non-financial services for entrepreneurship and trade. We will not lag behind the swift advance of innovations.

Business programs and initiatives often have traditional and inertial nature and in some instances duplicate each other. We should steer clear of that inertness and temptation of delivering our production only to customary markets. Coyness in discovering new markets and new products can be ruinous.

Distinguished Entrepreneurs,

Today, problems of economic growth and development have become priorities on the agendas of almost every country. In many developing countries, efforts aimed at the more widely spread prosperity do not yield desired results. While other societies, in similar conditions are able to provide for a stable high level and long lasting affluence and prosperity.

The world is changing right before our eyes and it is easily observable. Basic economic processes undergo changes which consequently bring about change in economic interrelations. The global financial crisis and its consequences highlight deep-laid problems existing in the world.

We are part of the world and feel the consequences of the global developments. Therefore, we have to respond in appropriate manner, adjusting in the process our own course. Only countries which will be able to consolidate their national potential, set high bars of development and work persistently toward reaching them will succeed. As important as natural resources are, in the contemporary world management and efficient performance are more important.

As a country with a small economy, we should be able to become a specialized part of the world developed industrial structure which will allow to secure our domestic development and growth. This is where transformation is essential. We have to meet the demand of the contemporary world, reassess our work style, actions and attitude.

And finally, we should reveal values mostly appropriate for our kind. At this point, I would like to deviate from the text a little and propose that we look for these comparative advantages not only in the sphere of high technologies, not only in the industrial area. We should be able to appreciate certain advantages bestowed upon us by nature itself. A group is working currently on that topic trying to develop a huge program. I believe, soon we will suggest our public and first of all our entrepreneurs to participate in a great program which can not only create jobs but also bring stability to our internal economic market.

Yes, our future economic growth and long-term development pledge is being transformed.

Yes, we do have a problem of economic growth and development. And that problem is greater than simple increase of productivity and employment. Today, economic development is a matter of national security. Only through the economic development we will be able to improve people’s lives, eliminate existing negative trends, and continuously strengthen our statehood. This is a universal issue and nobody’s monopoly.

Yes, we have to transform in order to be able to compete, produce, export, create income, implement new social and cultural programs. We should form a creative society, in which diligence, entrepreneurial spirit, professionalism, honesty, mutual trust and desire to create through the work prevail.

Yes, we are getting a new start. Historic necessity commands transformation: our state employees should transform, public figures, businessmen and overall citizens of the Republic of Armenia should transform. Entrepreneurship must be persistently separated from the state structure and authorities. Instead, the state should learn to fully respect and ensure each citizen’s and each businessman’s interest. State and businessman should become reliable partners, otherwise any program aimed at supporting a private enterprise will be ineffective.

We have spoken about all this for many times. We have also undertaken concrete actions which are already yielding results. However, I will use every appropriate occasion to remind this because forgetting this all - knowingly or unknowingly - is inadmissible.

Certainly, business needs political stability and stable economic environment: we will take steps to ensure both. With regard to economic stability, we will go even further, providing not only stable inflation rate and stable financial system but will also by year reduce the budget deficit – GNP ratio. The latter will add up to our margin of safety and the draft of the 2012 state budget testifies to it.

Business needs favorable environment: we will ensure that. We have already started the process of a steep ascend in the international rankings of the countries with the most liberal business environments. And last year, Armenia actually was the only country of the world which registered progress at all directions related to the level of liberalization. On this issues I expect new, more substantial achievements and our Government is well aware of that.

Business needs boosting: we will ensure that too. Steps undertaken by the Government on this direction are gradually showing results and are duly recognized by you. From the lessening of tax burden up to the creation of free economic zones, encouragement of innovative projects to the development of modern sub-infrastructure – this a wide range of the set in programs, the results of which will become observable very soon. We will undertake new steps on other directions as well.

Our agenda is packed. We should unite and form consensus regarding the main national and public interests in order to live in an Armenia which is paving way up and forward – in the name of our future and our values. I have no doubt that in that case success will not be late. I have also no doubt that you share this confidence.

You will speak about all these issues during the Convention. I wish you productive work; I wish you to conduct an interested, frank and open discussions on all the issues which you observe; mention the obstacles and also necessary spurs.

The Convention will elect Council of the Union and the members of the Council are requested to submit to me all these proposals. Besides, I am ready to meet in the nearest future with the members of the Council who will be ready to convey your proposals and inform me on your decisions.

I thank you and wish you success.

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