YEREVAN, JUNE 22, ARMENPRESS. More than 30 companies are presenting their products at an exhibition which is being held on the sidelines of the My Step For Tavush Province business forum in Dilijan.

https://armenpress.am/eng/news/979450.html

To slow migration ```

What can the Armenian government do ```

What can we do ```

What is the truth ```

What is your opinion ```

http://news.am/img/news/32/66/63/default.jpg

YEREVAN. - Armenia strongly falls behind in using IT in economy, CEO of the Union of Information Technology Enterprises (UITE) Karen Vardanyan told journalists Wednesday.

In his words, the main reason is the structure of the countrys economy: it has small number of medium-sized enterprises competing with each other, and they are not strong enough to be able to order IT-solutions.

Our main resource is the state, which orders systems of electronic management: we have established a consortium of 15 companies, which mainly cover the needs of the given market. The next resource is the army, and we saw that the IT application was not at the proper level here, he said.

The main strategic problem lies in the structure of the Armenian economy, which should be changed. Its reasonable to use IT solutions if your work is in a competitive sphere, he said adding that oligarchs and monopolists are interested by IT solutions only from the standpoint of the companys security and workers control.

However, more serious solutions which will give competitive advantages arent demanded since the monopolists have nobody to compete with. Thus, according to Vardanyan, the issue of using IT can be solved only through changing the structure of the economy towards an innovative one.

http://www.rferl.org/content/azerbaijani-devalues-currency-amid-plunging-oil-prices/26861627.html

Friday, March 14th, 2014

By Siranuysh Gevorgyan

ArmeniaNow reporter

http://armenianow.com/economy/48429/customs_union_eurasian_development_bank_european_union

A group of economists have drafted a research upon the initiative of the Eurasian Development Bank on “Economic Calculations of Armenia’s Integration Processes with the Customs Union and the Eurasian Economic Union.”

The group, lead by Ashot Tavadyan, head of the Faculty of Economic-Mathematical Methodology at the Yerevan State University of Economics, summing up the results of the four-month research told the press on Wednesday that in the event of Armenia’s membership in the Customs Union (CU) “an Armenian citizen will have a safer and better life”.

The economist shared an opinion that Armenia has not matured for European standards yet and could have found itself “in trouble”, just like Baltic countries have, if it entered the EU free trade area.

The experts have concluded that with the CU Armenia may have a 4-percent economic growth in the initial period, while in case of joining the EU free trade area that index would have ranged between two and three percent only (they referred to European experts’ analysis of Armenia’s Association Agreement with the EU to draw parallels).

As opposed to Bagrat Asatryan, former chairman of the Central Bank, who voiced rather pessimistic perspectives in this concern, Tavadyan claims the Customs Union agreement with Armenia is “about economic security, as part of security in general”.

“This is an agreement of unprecedented investments and employment growth,” stated Tavadyan.

The economist says that the public transport fares will drop in Armenia, as Russia has promised to make a $470-million investment in that field.

“The other important factor is the $100 million investment by the Eurasian bank, which will ensure high tempo of economic growth in our country. As for the energy bloc, joining the CU means we will have a good chance of exploiting the nuclear power plant and building a new one in the future,” says Tavadyan, predicting that in the future Armenia, as a CU member, would import natural gas from Russia at a 30-percent cheaper price: today’s $270 per 1,000 cubic meter would cost $187.

“It will happen automatically, since the union ideology provides for fair competition, meaning that the gas tariff, in our case, would include only transportation and transit fees,” assures Tavadyan.

Another conclusion is that in the event of joining the CU Armenia's labor migrants would send 3 percent more remittances to Armenia, as they would have less trouble “finding employment and dealing with administrative issues”.

11 Oct. 2013

MOSCOW, October 11 (Howard Amos, RIA Novosti) – Russia and Lebanon announced closer ties Thursday as four of Russia’s biggest energy companies jostle for deals to develop Lebanese gas fields in the Eastern Mediterranean which could draw them into a long-running territorial dispute with Israel.

Oil giant Rosneft, state-owned gas giant Gazprom, and privately-owned Novatek and LUKoil have all expressed interest in 10 hydrocarbon-rich blocks off the Lebanese coast for which Beirut is expected to award much-delayed licenses in early 2014.

At the end of a visit to Moscow, Lebanese Energy Minister Gebran Bassil said that Russia and Lebanon had signed a memorandum of understanding on cooperation in the energy sphere.

“It is the first step towards a complete relationship between Russia and Lebanon,” he told reporters Thursday, after meeting with Russian energy companies and investors.

“We have seen a real, authentic desire [to be involved in Lebanese gas field development],” he added.

Technically at war with Israel, Lebanon warned in July that Israel has the technical capacity to draw gas from Beirut’s offshore fields, Reuters reported. The two countries have turned to the United Nations in an attempt to resolve an ownership dispute over about 500 square kilometers along their Mediterranean maritime border.

A total of 46 companies, including US oil and gas majors ExxonMobil and Chevron, are taking part in the initial stages of the tender for the Lebanese gas fields. The interested companies have spent $127 million on requests for information from Beirut, Bassil said.

LUKoil was the first Russian company to announce its interest, just a few days after Russian President Vladimir Putin met with his Lebanese counterpart in Moscow on January 23.

Gazprom’s interest in the area is more longstanding, as it wants to bolster its access to its European customers. The Russian gas giant lost a key tender last year to take a stake in Israel’s giant Leviathan gas field, where production is expected to begin in 2016.

Lebanon is lagging behind other Eastern Mediterranean states, including Israel and Turkey, in developing its offshore energy reserves. Decision-making is currently hamstrung by a domestic political impasse, and the license-granting process has already been delayed several times.

It may be difficult for Beirut to award the contracts solely to Russian companies, and it is more likely that licenses will be granted to consortiums from a variety of countries that could include both the US and Russia, Ildar Davletshin, oil and gas analyst at Renaissance Capital in Moscow, told RIA Novosti Thursday.

“Politically, it’s a very sensitive area, and just relying on Russian companies might be too risky,” he said.

Read more here: http://www.sacbee.com/2013/09/28/5777538/governor-brown-signs-california.html#storylink=cpy

Moving away from dependence on Russia and Middle East hydrocarbons was a key energy objective of European countries in the 1990s, and the oil and natural gas resources along the Caspian Sea was seen as a vital alternative.

Instead, European oil dependence on Russia and the Middle East has grown from 75% in 2000 to 84% by 2010. In addition, EU reliance on gas imports has also risen from 49% to 62% during the period.

EU countries such as Austria, Bulgaria, the Czech Republic, Estonia, Finland, Latvia, Lithuania, Poland, and Slovakia all depend on Russia for over 60% of their gas imports. In addition, countries aspiring to be EU members such as Moldova, Turkey, and Ukraine rely on Russia for over 65% of their imports.

Central Asia is estimated to hold more than 11% of world proven gas reserves, primarily in Turkmenistan, which has lagged behind Kazakhstan and Azerbaijan in attracting outside investments.

The region currently produces less than 5% of global gas supply, so there is tremendous growth prospect.
But while China has moved swiftly to source supplies from Central Asian states of Turkmenistan, Kazakhstan and Azerbaijan, Europe has been distracted by a crippling economic recession.

"European gas demand is likely to continue to struggle for the next five years, facing competition from cheaper coal and the promotion of renewables, while also suffering due to poor economic performance," said the Economist Intelligence Unit in a new report.

"As a result, the sense of urgency in opening up the Caspian region's gas supply to European customers--while still viewed as important--has somewhat dissipated. Nevertheless, it is still important for south-east European states, where dependence on gas from Russia is the strongest."

US OBJECTIVES

The United States is keen to position Central Asia as a viable alternative to Russia, but it also has greater designs for the region to meet its geopolitical strategic objectives.
In the east, the US is keen to increase trade ties between Central Asia and the South Asian states of Afghanistan, Pakistan and India.
In the south, the United States believes the rise of Central Asian states as a steady source of hydrocarbons will further weaken Iran as the two often compete for the same set for customers.
In addition, some Central Asian states depend on Iran to access markets, and greater ties to their east and west will further reduce their dependence on Tehran.
Meanwhile, the big prize is to reduce Russian energy exports to the European Union.

SIGNIFICANT OIL PRODUCER

With the help of Western investments, Central Asia and the Caucasus today produce around 3.5% of global oil supply and hold around 2.5% of the world's known proven reserves in oil (or four times that of Norway and the United Kingdom combined), according to Edward C. Chow, senior fellow, Energy and National Security Program at the Center for Strategic and International Studies.
"Another way of looking at this is to say the region produces around 8.5% of non-OPEC oil and holds around 9.5% of non-OPEC oil reserves," Chow told a US government committee on foreign affairs. "In other words, oil production in Central Asia has added significantly to global supply and will continue to do so in the future."


A report presented by US government officials to the Committee on Foreign Relations headed by John Kerry, states that the development of a Southern Corridor to link the Caspian to Europe with oil and natural gas pipelines was a key US strategy to reduce European dependence on Russia. The first stage was achieved with the completion of the Baku-Tblisi-Ceyhan (BTC) oil pipeline from Azerbaijan to a Turkish Mediterranean port and the South Caucasus Gas Pipeline (SCP) from Azerbaijan to Turkey.
"The next phase of the Southern Corridor would advance several US and NATO foreign policy objectives: it would further isolate Iran, assist in cultivating partners in the Caucasus and Central Asia and bolster their sovereign independence, and perhaps most importantly, curtail Russia's energy leverage over European NATO allies," the report noted.
The development of new pipelines such as the Trans Adriatic Pipeline (TAP), that transports natural gas from Azerbaijan's massive Shah Deniz field, and Trans-Anatolian Pipeline (TAP) between Azerbaijan and Turkey, are all vital cogs to raise the profile of Central Asian resources at the expense of Russian and some Middle Eastern supplies.

STRENGTHENING TIES
The US report recommends forging closer ties with countries like Azerbaijan, Kazakhstan, and NATO partners EU and Turkey to hasten developments on this front.
Among these include a recommendation for Azerbaijan to use its pipelines to transport Turkmenistan gas to other nations.
"Turkey should secure contracts to purchase natural gas from Turkmenistan and gain the support of Azerbaijan and private energy companies to allow this gas to transit Azerbaijani energy infrastructure," the report recommended.
Azerbaijan has been reluctant to serve as a conduit to Turkmenistan natural gas, but the US nudge may help change its mind.
Indeed, the United States sees Turkmenistan as a major player in the great Caspian natural gas chess game.
"By virtue of geography and geology, Turkmenistan would be the anchor of trans-Caspian energy trade, but it is not the only player. Kazakhstan is already a participant in the Southern Corridor, shipping oil across the Caspian by barge to Baku to connect to the BTC [baku-Tblisi-Ceyhan] oil pipeline."
The pipeline could also allow Kazakhstan to monetize its largely underdeveloped 1.9 trillion cubic meters of natural gas reserves.
But progress on all these fronts has been slow. The EIU estimates that a mere 16 billion cubic meters of natural gas will flow from Central Asia to Turkey and Europe by the end of the decade - a fraction of the 585 billion cubic meters the region is expected to consume by 2020.
"By the end of this decade Shah Deniz gas will be flowing to European markets.

Despite changed dynamics regarding European gas supply the opening up of the

Southern Gas Corridor remains a useful energy security objective," said the EIU. "The challenge for the next decade is to expand its capacity so it can make a greater impact on securing Europe's gas supply needs."
==========
Can anyone break Russia's hold on Europe's gas?
Europeans want cheaper natural gas to jumpstart an economy crippled by high energy costs. The trouble is, alternatives to Russian gas are plenty in theory, but few in reality.
By David J. Unger / September 14, 2013
http://www.csmonitor.com/Environment/Energy-Voices/2013/0914/Can-anyone-break-Russia-s-hold-on-Europe-s-gas?cmpid=addthis_twitter#.UjUyQQ1pWi8.twitter
-----------
War clouds are looming on the horizon
September 4, 2013
By By JOHN CHERIAN
http://www.phantomreport.com/war-clouds-are-looming-on-the-horizon
Syria, the only country which has a truly secular Constitution and which is home to an amalgam of ethnic groups and faiths, was specifically targeted for regime change.
---
World powers and regional actors are increasingly converging on Syria, a development which threatens to mesh the civil war between pro- and anti-Syrian regime forces into the wider regional conflict between Sunnis and Shiites, as well as the global tussle between the U.S. and Russia over spheres of influence.
http://www.phantomreport.com/analysis-the-internationalization-of-the-syrian-civil-wa

Recently launched website on IT in Armenia...

Available in Armenian, English, and Russian.

Princess Europa's face will be shown as a watermark and as a hologram.

The new notes will also carry an emerald-coloured number.

The first series of banknotes will circulate alongside the old ones. But the old notes, first introduced 10 years ago, will eventually cease to be legal tender.

The old notes will retain their face value and will be exchangeable at any national central bank in the eurozone even when they are no longer valid in shops.

Meanwhile, counterfeiting euro notes has kept international law enforcement authorities busy. This being the reason for more secure euro notes.

Posted on June 27, 2012 at 6:41 am by Bloomberg in Automobiles, Natural Gas

Armenia is not generally known as a world leader, but it holds at least one record: Seventy-five percent of its cars and trucks run on natural gas.

In the U.S., in contrast, the share is well under 0.1 percent — even though natural-gas prices have plummeted here over the past few years. Given the problems associated with U.S. dependence on oil, more use of natural gas for transportation could carry big benefits.

One of the most important of these would be macroeconomic. Switching to natural-gas vehicles would reduce our vulnerability to oil-price shocks, as Christopher Knittel, a professor of energy economics at the Massachusetts Institute of Technology, argues in a new paper for the Hamilton Project. That benefit alone could amount to between $850 (for sedans) and $18,500 (for heavy-duty trucks) for each vehicle converted.

More natural-gas cars and trucks could also, if managed well, reduce greenhouse-gas emissions and other pollutants (more on that below). The bottom line is that the U.S. would be much better off with a wider choice of transportation fuels.

Converting to natural-gas vehicles requires several changes but, as Floyd Norris of the New York Times has recently pointed out, the most elemental involves filling stations. There are fewer than 2,000 natural-gas stations across the country — a fraction of the 120,000 that offer gasoline. This makes people and companies reluctant to shift to the new vehicles. At the same time, the dearth of natural-gas vehicles on the road makes fuel companies reluctant to build the stations they need.

Ready Legislation

A measure recently considered in Congress, the New Alternative Transportation to Give Americans Solutions Act, is aimed at this chicken-and-egg problem. It would, among other things, provide a 50 percent tax credit, up to a maximum of $100,000, for installing natural-gas filling stations and also encourage people and companies to buy more natural-gas vehicles.

The Natgas Act is a rare piece of legislation these days — it would not only address an important problem but do so sensibly, with bipartisan backing. (It is languishing in Congress partly because other industries that benefit from low natural-gas prices oppose it; they don’t want transportation competing for the resource.) Still, given the potential benefits for energy policy and the economy, the Natgas Act should be even more ambitious.

To provide a forceful incentive to create the needed filling stations, the federal government could provide an 80 percent tax credit, up to a maximum of $250,000, for additions to existing stations and $2 million for new stand-alone facilities, for the first 20,000 natural-gas stations built over the next three years. This would be the Natgas Act on steroids.

It would make sense for many of the new facilities to be along national highways, to service long-haul trucks. (United Parcel Service Inc. is already trying to provide fueling for natural-gas trucks in the Los Angeles-Las Vegas corridor.)

Assuming that half of the eligible 20,000 stations were add-ons to existing facilities and half were new ones, the maximum cost to the government over the next three years would be $22.5 billion, or about $7 billion a year. Twenty percent cost sharing for station builders would be high enough to force them to optimize locations and not build stations that have little or no economic value, yet still low enough to encourage construction.

In exchange for that $7 billion a year or less, we would get a network of stations sufficient to make natural-gas vehicles a feasible alternative, while also putting more people back to work. It would be an economic stimulus today that would build a macroeconomic hedge for tomorrow.

More Strategies

If that seems too ambitious — we often seem to be living in an era of meekness in public policy — Knittel has other good suggestions. He would, for one, encourage home fueling by requiring natural-gas distribution companies to sell to individual customers for their cars at low rates. And he would allow those companies to include in their regulated rate bases the cost of building new filling stations.

What about the environmental benefits of switching to natural-gas vehicles? Such cars and trucks emit perhaps 25 percent less greenhouse gases than petroleum vehicles do. That comparison, however, has to do only with the vehicles’ operation — and not how the fuel is obtained in the first place.

As Fred Krupp of the Environmental Defense Fund has underscored, methane leakage from gas production may be large enough that its net impact on the climate is negative for many years. Methane, the principal component of natural gas, is an extraordinarily powerful greenhouse gas. It dissipates faster than carbon dioxide, however, so the climate effects depend on the time horizon.

A recent article in the Proceedings of the National Academy of Sciences concluded that, given current leakage rates of methane in the production of natural gas, vehicles that run on the fuel “are not a viable mitigation strategy for climate change.” It estimated that converting from gasoline to natural- gas vehicles would adversely affect the climate for at least 80 years, and switching from heavy-duty diesel vehicles would exacerbate greenhouse-gas effects for 300 years.

Methane leakage would have to be reduced to 1 percent to 1.6 percent to make natural-gas conversions beneficial for the climate over the next few decades, the same study found. Estimates of current leakage are debated, but they are very likely much larger than the break-even rates. The Environmental Protection Agency recently announced regulations that will indirectly lead to lower methane emissions from shale gas production. It is worth exploring more efficient approaches (potentially even a permit-trading system) to reduce methane leakage as natural gas is produced and transported.

With a bold incentive for more natural-gas filling stations, we could put more people to work today and might one day even catch up to Armenia on natural-gas vehicles. And with more effort to plug methane leaks, we could be confident about helping the climate along the way.

(Peter Orszag is vice chairman of global banking at Citigroup Inc. and a former director of the Office of Management and Budget in the Obama administration. The opinions expressed are his own.)

December 10, 2011 Saturday

Iran to Link Power Grid to EU

TEHRAN (FNA)- Senior Iranian energy officials said a new power line

from Iran to Armenia and Georgia is due to send Iran's electricity

through to Europe.

The completion of a 230 KW electric cable from Iran to Armenia will

provide the possibility of connecting Iran's and Georgia's electricity

network, whilst increasing the overall capacity to trade energy with

Iran's neighbors to 400 KW, Iran's Deputy Energy Minister Mohammad

Behzad said.

Currently Georgia's electricity is routed through Azerbaijan.

Armenia's minister of energy welcomed the project last week, and said

it would triple the electricity exchanged between Armenia and Georgia.

Iran and Azerbaijan are currently discussing a project to connect

Iran's electricity network to Russia while talks are also under way

with Turkey to connect Iran's grid to Lebanon in addition to plans to

connect its network to Persian Gulf countries. If these talks are

successful, Iran will be a strong electricity hub in the region.

Turkmenistan, Turkey, Iraq, Afghanistan and Pakistan will all buy

electricity from Iran.

Iran's capacity to export electricity has increased 24 per cent since

the implementation of its targeted subsidies program and is expected

to earn $1 billion by the end of this year (Iran's solar year ends in

March).

http://xecutrix.usc.edu/news/msg402331.html

Mu Xuequan

English.news.cn

July 7 2011

China

Tbilisi, July 6 (Xinhau)-- The Forbes magazine has ranked the South Caucasus country of Armenia as the second worst economy in the world this year, after having analyzed the macro-economic indicators of 177 countries and regions over the past three years.

Other data used by Forbes for its analysis included the per capital gross domestic product growths as relesed by the International Monetary Fund (IMF), the IMF-forecast inflation rates in the coming 2012 and the current account balaces.

The 2011 Forbes-ranked world's worst five economies are Madagascar, Armenia, Guinea, Ukraine and Jamaica.

Armenian's economy in 2010 witnessed a 2.6 percent year-onyear GDP growth.

In 2010, the Forbes magazine ranked Zibabwe, the Democratic Republic of the Congo and Guinea as the world's three worst economies.

The Armenian national statistical service reported that the country's per capital GDP at the end of last year was 2,885 U.S. dollars and 3,509.6 dollars in current prices over the reporting period.

Emil Danielyan: 10/20/03

Transparency International, an international non-governmental organization, has ranked Yerevan among the least corrupt former Soviet republics. Azerbaijan and Georgia, along with Central Asian states, lagged near the bottom of the NGO’s annual corruption survey.

Armenia came in 78th place in Transparency International’s 2003 survey of 133 countries, formally known as the Corruption Perceptions Index. Among Caucasus countries, Armenia ranked far ahead of Azerbaijan and Georgia, which shared 124th place together with three other states. Corruption in Baku and Tbilisi is "pervasive," according to the annual survey.

Bangladesh rated as the world’s most corrupt country, while Finland ranked as the cleanest. Russia ranked 86th. Among Central Asian states, Kazakhstan and Uzbekistan tied in 100th. Kyrgyzstan was 118th and Tajikistan was 124th. Turkmenistan was not rated.

The ranking was determined by the extent of their corrupt practices as perceived by business leaders, academics and risk analysts. All countries were evaluated on a 10-point scale, in which a score of 10 represented an absence of graft. Armenia scored 3.0 in Transparency’s Corruption Perception Index, up from 2.5 points it received in 2000. The score, though low in absolute terms, puts the country just below the NGO’s threshold for a "high level" of corruption.

Representatives of the International Monetary Fund (IMF) have endorsed Transparency International’s findings, based on separate studies conducted by international lending institutions.

"A number of other studies ... have basically confirmed the observation that if one looks at the CIS as a whole, Armenia is among the better performers," said James McHugh, the IMF resident representative in Yerevan.

McHugh cautions at the same time that the Armenian authorities still have "a long way to go" in promoting the rule of law. This is also the point stressed by independent Armenian experts. "In my opinion, going up from 2.5 to 3.0 in three years is a modest achievement," says Arevik Saribekian of Transparency International’s Armenian branch. "Corruption may indeed be down but we shouldn’t consider it a high score."

Corrupt practices, which date back to the Soviet era, have long been as a serious hindrance to Armenia’s economic development, which is also hampered by the unresolved conflict over Nagorno-Artsax. [For background see the Eurasia Insight archive]. Improper conduct, including bribery and nepotism – remains relatively common among government bureaucrats. Bribes are often offered to get officials to turn a blind eye on tax evasion, cover up a criminal case, speed up bureaucratic paperwork or even enroll a student in a state university.

The impact of graft has been particularly negative on the country’s investment climate. Some forms of lucrative economic activity (e.g., imports of fuel and basic foodstuffs) still require government patronage. Also, many businesses have long complained about harassment from corrupt tax and customs officials.

Authorities in Yerevan have been under growing pressure from the IMF and other Western donors to tackle the problem. In recent years, they have simplified Armenia’s business legislation and enacted a set of laws aimed at complicating abuses committed by government officials. However, virtually no senior government officials have been sacked or prosecuted on corruption charges.

In late 2001, the government received a $340,000 grant from the World Bank to work out a comprehensive anti-corruption strategy. Publication of the document has since been repeatedly delayed and is now expected by the end of this year.

Armenian opposition leaders have expressed skepticism over whether President Robert Kocharian’s administration has the political will to implement an anti-corruption plan. Kocharian critics maintain that corruption serves as a key pillar of Armenia’s oligarchic political order. To support their claims, opposition point to Armenia’s presidential and parliamentary elections earlier this year, which were both marred by widespread allegations of fraud. [For background see the Eurasia Insight archive].

McHugh, however, noted the Armenian government has registered significant anti-corruption results in recent years, singling out Armenia’s banking and energy sectors as the areas where progress has been particularly evident. "There is a perception out there that Armenia is a very corrupt country," McHugh explains. "But what we see from these indicators is that perhaps that impression is too negative and that the situation is improving."

In the words of another member of Transparency International’s Armenian affiliate, Varuzhan Hoktanian, a lot will depend on public scrutiny over the implementation of anti-graft measures. "World experience shows that countries with strong civil societies are less corrupt because their citizens hold their rulers in check," he says. "Government programs alone don’t solve problems."

Editor’s Note: Emil Danielyan is a Yerevan-based journalist and political analyst.

What the U.S. dollar is today stands UNDEFINED except for a minuscule statement on the dollar bill that says "This note is legal tender for all debts, public and private". It doesn't say this note is legal tender for $1 in debt or $100 in debt (or in gold or even in seashells); it says for ALL debts only. So if tomorrow the U.S. Congress presented a $1 bill to the Chinese who hold about 2 trillions in U.S. obligations or debt, the Congress would not be reneging on the promise written on the dollar bill. Preposterous! But as I said above, the Congress is violating the very Constitution it is supposed to uphold; thus, for breaking the very laws that are the basis of American sovereignty, both Democrats and Republicans are traitors. They must be arrested and tried if the law of the land means anything.

U.S. Tops List of Countries with the Largest External Debt

The World Bank maintains the database of Gross External Debt Positions

of countries.The top five countries with the largest external debt are

as follows:

Country External Debt in Millions Year-Over-Year Change

(at the end of 2008)

United States 13,641,807 1.6%

United Kingdom 9,388,012 -19.9%

Germany 5,250,499 1.8%

France 5,001,696 2.4%

Netherlands 2,439,864 -6.1%

The USA is the biggest debtor country with a total of $13.6 Trillion

at the end of 2008. On a year-over-year basis, this represents an

increase of 1.6%. In order to see the creditors to the US, you can

check my earlier post titled Top Ten Creditors to the USA. The country

with the second largest debt is the UK. Total external debt of the UK

stood at $9.3 T. Though this may seem large at first glance, it is

actually good since the UK reduced their debt by 19.9% from 2007. All

the top five debtor countries are developed rich countries.This is

fascinating since these countries are able to borrow so much money to

keep their economy moving forward.

The countries with the lowest amount of debt are:

Country External Debt in Millions Year-Over-Year Change

(at the end of 2008)

Armenia 3427 15.1%

Kyrgyz Republic 3467 8.8%

Paraguay 3507 11.7%

Moldova 4125 19.4%

Bolivia 5923 9.1%

All the above countries are small countries in the developing

world. Armenia has the lowest debt at $3.4B. However this was an

increase of 15.1% from 2007.

Some of the countries have been reducing their external

debt. Switzerland and the UK reduced it the most at nearly 20% from

2007. Other countries that have decreased their debt in 2008 include

Australia, Canada, Israel, Egypt, etc.

The list below shows the countries that reduced their debt in 2008:

Country Year-over-Year Change

Korea -0.7%

Egypt -2.2%

Uruguay -3.0%

South Africa -4.8%

Israel -5.1%

Italy -6.0%

Netherlands -6.1%

Canada -7.4%

Australia -7.4%

Hong Kong, China -7.7%

Belgium -14.3%

United Kingdom -19.9%

Switzerland -19.9%

The countries that increased their external debt in 2008 compared to

2007 are:

Country Year-over-Year Change

Georgia 26.8%

Japan 24.6%

Ukraine 20.4%

Hungary 20.0%

Moldova 19.4%

Malaysia 17.2%

Bulgaria 16.6%

Belarus 15.7%

Slovak Republic 15.6%

Armenia 15.1%

Chile 14.0%

Paraguay 11.7%

India 10.8%

Croatia 10.1%

Kazakhstan 10.1%

Turkey 10.1%

Georgia was the worst with an increase of over 25%. Hungary almost

collapsed due to the heavy debt load before it was rescued earlier

this year.

http://seekingalpha.com/article/144442-u-s...t-external-debt

http://groong.usc.edu/news/msg273981.html

Would people be interested in sharing investment ideas here? Is it practical or more of a hustle?

[ January 23, 2003, 07:29 PM: Message edited by: Azat ]

Associated Press, 06.04.09, 09:53 AM EDT

YEREVAN, Armenia -- Armenia has signed the first contract for the building of an atomic energy plant to replace its aging Soviet-era plant.

Energy Minister Armen Movsisian says international engineering firm Worley Parsons won the $460 million contract to manage the project.

He said Thursday the project's overall cost is estimated at $4.5 billion.

It is scheduled to be completed by 2017 at the site of the existing Medzamor plant, about 30 kilometers (20 miles) west of the capital, Yerevan.

Experts have warned for years that the Medzamor plant has safety flaws and should be shut down.

Armenia has long resisted shutting it down because it supplies nearly 40 percent of the country's power.

http://www.forbes.com/feeds/ap/2009/06/04/ap6504365.html

================

no word on it in any of the armenian media sources...

business new europe

http://businessneweurope.eu/storyf1611/Ban...menias_diaspora

May 26 2009

Armenia's best export is its people and the government is hoping to

tap its wealthy diaspora by setting up a global retail bank that can

funnel some of their money into projects back at home.

There are three times more Armenians living outside the country than in

it and remittances make up the single biggest hard currency earner for

the country; it seems no matter how far Armenians travel, their hearts

remain at home. The government wants to capitalise on this loyalty

and instead of waiting for the money to be sent home, it will go out

and get it by setting up a bank with branches all over the world. "It

is a global retail bank that will target Armenians living overseas,"

Armenia's minister of economy, Nerses Yeritsyan, tells bne during May's

annual meeting of the European Bank for Reconstruction and Development

in London. "Imagine: if only 1% of all Armenians take a credit card

from the new bank, then that will generate enough money for us to

say goodbye to [international financial institution] funding forever."

The inflow of remittances is already worth billions of dollars a

year, but this is only the tip of the asset iceberg and a fraction

of the personal wealth of successful Armenia's who live overseas,

most of which is deposited in local banks. With large populations

concentrated in places like Moscow, London and Los Angeles - pop

music diva Cher is an ethnic Armenian - the locations for the first

branches are pretty obvious.

Home role

The government contributed $20m to the capital of the bank, which

has already been set up, but isn't operational yet. The plan was to

raise another $80m from Armenians around the world. "The other half

of the equation is the resources the bank mobilises and will invest

into targeted projects back in Armenia. It is a way for our diaspora

to take a more active role in the development of the country and at

the same time earn a good return on that growth," says the minister.

However, the crisis threw a wrench into the plans, as most of the

commitments - which came from both large Armenian-owned businesses

and private individuals - have been put on hold after markets

crashed around the world at the end of last year. "We took the

bank on a road show last year and found there was a lot of support

amongst the diaspora," says Yeritsyan. "However, these commitments

have been withdrawn for the moment while everyone is assessing their

position. But we are confident that they will return and we can push

ahead as planned with the bank."

In the meantime, the government has hired head hunters to find a top

quality international CEO, as the tricky bit of making a global retail

bank work is that it will have to compete with high street banks in

the US and UK in terms of the quality of its service. It won't be easy,

but Yeritsyan is literally banking on the loyalty that Armenians feel

towards their homeland to give the bank a competitive edge.

http://groong.usc.edu/news/msg270616.html

YEREVAN, Armenia

Armenians rushed to buy bread, butter and other staples Tuesday and stores shut down in panic after the government announced it would let the national currency fall and was seeking a bailout from the IMF.

Banking authorities said the national currency -- the dram -- could sink up to 24 percent with the decision. The devaluation was sure to hurt ordinary Armenians, with prices for imported goods expected to rise sharply.

The Armenian Central Bank decided to limit currency interventions and return to free float policy "due to the financial and economic crisis, worsening terms of trade and slowing capital inflows," bank chairman Artur Dzhavadian told reporters Tuesday.

Armen Gevorkian, a 33-year-old engineer, was stocking up on food in downtown Yerevan, where staples typically include bread, butter, sugar, salt and vegetable oil.

"I'm buying food with all the drams I have because the dollar is going to rise and then the situation will be very difficult," he said.

Prices at some grocery stores shot up 20 to 30 percent on Tuesday. One of Yerevan's largest grocery chains, Star, closed all of its stores shortly after the Central Bank's announcement.

Until now, the small South Caucasus country had pursued a managed float policy for the dram, having the central bank spend reserves to maintain the currency's value.

With Tuesday's move, Armenia's banking authorities said they expect the dram to fall to between 360 to 380 to the U.S. dollar, compared a level of 306 before the free float policy was announced.

Many foreign exchange booths had stopped selling foreign currency, but Georg Melkonian, a businessman, said he bought dollars without any problems at one bank.

Several hours after Armenia's Central Bank announced the move, IMF Managing Director Dominique Strauss-Kahn recommended that its executive board to approve the country's request for a $540 million loan.

The IMF had demanded that Armenia let its currency float before it could get a loan. This would allow "the exchange rate to move in line with market fundamentals, so as to cushion the economy from the external shocks and safeguard foreign exchange reserves," Strauss-Kahn said in a statement.

The IMF will discuss the allocation of the loan Friday. Armenia will be able to draw about $239 million immediately if the request receives approval.

The World Bank also supported Armenia's move, saying it was necessary "to strengthen Armenia's competitiveness and mitigate the impact of the global financial crisis." The bank lauded Armenia's leadership for "prudent macroeconomic management, a low level of public debt, and a sound banking system."

The Armenian economy has been growing steadily in the past four years and has not been hit as hard as Russia or neighboring Georgia by the global financial crisis.

Armenia's GDP rose by 14 percent in 2007 and added 8 percent in 2008. This year, the economy is expected to slip into recession and contract by 1.5 percent.

“Sick people no longer see doctors. The number of patients keeps falling down, and if they continue ignoring their health problems they will surely die.

“I get a salary of 25 000 drams. Yesterday a woman came in a grave state. She said she had no money to pay. What could I do? Shouldn’t I help her?” says cardiologist Anita Mkhitaryan who works in a Yerevan hospital.

“Only my father works in our family. During the past five years my uncle living in Volgograd used to send us money. But it is three months he has sent no penny, and we have appeared in a tight,” says 23-year-old pedagogue Narine Hovsepyan.

Newsagent Tigran Bayatyan says his clients also began complaining of the crisis which greatly affects his trade. “One of them used to buy five newspapers a day. Today he buys only two. My friend importing journals and magazines from Russia has reduced the import by 50 percent.

I can no longer rent the newsstand. Sometimes I have to go to work at the weekends. If once I earned 5000-6000 drams a day, now I get 3500 drams at the best,” said Tigran.

36-year-old Vardan thinks the “so-called financial crisis” is bluffing. “A labourer will always find a job. They delude people saying there is a financial crisis worldwide. People are feared to spend their money. This is a crisis,” he says.

http://www.guardian.co.uk/business/2009/ja...viduals-economy

Twenty-five people at the heart of the meltdown ...

The worst economic turmoil since the Great Depression is not a natural phenomenon but a man-made disaster in which we all played a part. In the second part of a week-long series looking behind the slump, Guardian City editor Julia Finch picks out the individuals who have led us into the current crisis

Alan Greenspan, chairman of US Federal Reserve 1987- 2006

Only a couple of years ago the long-serving chairman of the Fed, a committed free marketeer who had steered the US economy through crises ranging from the 1987 stockmarket collapse through to the aftermath of the 9/11 attacks, was lauded with star status, named the "oracle" and "the maestro". Now he is viewed as one of those most culpable for the crisis. He is blamed for allowing the housing bubble to develop as a result of his low interest rates and lack of regulation in mortgage lending. He backed sub-prime lending and urged homebuyers to swap fixed-rate mortgages for variable rate deals, which left borrowers unable to pay when interest rates rose.

For many years, Greenspan also defended the booming derivatives business, which barely existed when he took over the Fed, but which mushroomed from $100tn in 2002 to more than $500tn five years later.

Billionaires George Soros and Warren Buffett might have been extremely worried about these complex products - Soros avoided them because he didn't "really understand how they work" and Buffett famously described them as "financial weapons of mass destruction" - but Greenspan did all he could to protect the market from what he believed was unnecessary regulation. In 2003 he told the Senate banking committee: "Derivatives have been an extraordinarily useful vehicle to transfer risk from those who shouldn't be taking it to those who are willing to and are capable of doing so".

In recent months, however, he has admitted at least some of his long-held beliefs have turned out to be incorrect - not least that free markets would handle the risks involved, that too much regulation would damage Wall Street and that, ultimately, banks would always put the protection of their shareholders first.

He has described the current financial crisis as "the type ... that comes along only once in a century" and last autumn said the fact that the banks had played fast and loose with shareholders' equity had left him "in a state of shocked disbelief".

Mervyn King, governor of the Bank of England

When Mervyn King settled his feet under the desk in his Threadneedle Street office, the UK economy was motoring along just nicely: GDP was growing at 3% and inflation was just 1.3%. Chairing his first meeting of the Bank's monetary policy committee (MPC), interest rates were cut to a post-war low of 3.5%. His ambition was that monetary policy decision-making should become "boring".

How we would all like it to become boring now. When the crunch first took hold, the Aston Villa-supporting governor insisted it was not about to become an international crisis. In the first weeks of the crunch he refused to pump cash into the financial system and insisted that "moral hazard" meant that some banks should not be bailed out. The Treasury select committee has said King should have been "more pro-active".

King's MPC should have realised there was a housing bubble developing and taken action to damp it down and, more recently, the committee should have seen the recession coming and cut interest rates far faster than it did.

Bill Clinton, former US president

Clinton shares at least some of the blame for the current financial chaos. He beefed up the 1977 Community Reinvestment Act to force mortgage lenders to relax their rules to allow more socially disadvantaged borrowers to qualify for home loans.

In 1999 Clinton repealed the Glass-Steagall Act, which ensured a complete separation between commercial banks, which accept deposits, and investment banks, which invest and take risks. The move prompted the era of the superbank and primed the sub-prime pump. The year before the repeal sub-prime loans were just 5% of all mortgage lending. By the time the credit crunch blew up it was approaching 30%.

Gordon Brown, prime minister

The British prime minister seems to have been completely dazzled by the movers and shakers in the Square Mile, putting the City's interests ahead of other parts of the economy, such as manufacturers. He backed "light touch" regulation and a low-tax regime for the thousands of non-domiciled foreign bankers working in London and for the private equity business.

George W Bush, former US president

Clinton might have started the sub-prime ball rolling, but the Bush administration certainly did little to put the brakes on the vast amount of mortgage cash being lent to "Ninja" (No income, no job applicants) borrowers who could not afford them. Neither did he rein back Wall Street with regulation (although the government did pass the Sarbanes-Oxley Act in the wake of the Enron scandal).

Senator Phil Gramm

Former US senator from Texas, free market advocate with a PhD in economics who fought long and hard for financial deregulation. His work, encouraged by Clinton's administration, allowed the explosive growth of derivatives, including credit swaps.

In 2001, he told a Senate debate: "Some people look at sub-prime lending and see evil. I look at sub-prime lending and I see the American dream in action."

According to the New York Times, federal records show that from 1989 to 2002 he was the top recipient of campaign contributions from commercial banks and in the top five for donations from Wall Street. At an April 2000 Senate hearing after a visit to New York, he said: "When I am on Wall Street and I realise that that's the very nerve centre of American capitalism and I realise what capitalism has done for the working people of America, to me that's a holy place."

He eventually left Capitol Hill to work for UBS as an investment banker.

Abby Cohen, Goldman Sachs chief US strategist

The "perpetual bull". Once rated one of the most powerful women in the US. But so wrong, so often. She failed to see previous share price crashes and was famous for her upwards forecasts. Replaced last March.

Kathleen Corbet, former CEO, Standard & Poor's

The credit-rating agencies were widely attacked for failing to warn of the risks posed by mortgage-backed securities. Kathleen Corbet ran the largest of the big three agencies, Standard & Poor's, and quit in August 2007, amid a hail of criticism. The agencies have been accused of acting as cheerleaders, assigning the top AAA rating to collateralised debt obligations, the often incomprehensible mortgage-backed securities that turned toxic. The industry argues it did its best with the information available.

Corbet said her decision to leave the agency had been "long planned" and denied that she had been put under any pressure to quit. She kept a relatively low profile and had been hired to run S&P in 2004 from the investment firm Alliance Capital Management.

Investigations by the Securities and Exchange Commission and the New York attorney general among others have focused on whether the agencies are compromised by earning fees from the banks that issue the debt they rate. The reputation of the industry was savaged by a blistering report by the SEC that contained dozens of internal emails that suggested they had betrayed investors' trust. "Let's hope we are all wealthy and retired by the time this house of cards falters," one unnamed S&P analyst wrote. In another, an S&P employee wrote:

"It could be structured by cows and we would rate it."

"Hank" Greenberg, AIG insurance group

Now aged 83, Hank - AKA Maurice - was the boss of AIG. He built the business into the world's biggest insurer. AIG had a vast business in credit default swaps and therefore a huge exposure to a residential mortgage crisis. When AIG's own credit-rating was cut, it faced a liquidity crisis and needed an $85bn (£47bn then) bail out from the US government to avoid collapse and avert the crisis its collapse would have caused. It later needed many more billions from the US treasury and the Fed, but that did not stop senior AIG executives taking themselves off for a few lavish trips, including a $444,000 golf and spa retreat in California and an $86,000 hunting expedition to England. "Have you heard of anything more outrageous?" said Elijah Cummings, a Democratic congressman from Maryland. "They were getting their manicures, their facials, pedicures, massages while the American people were footing the bill."

Andy Hornby, former HBOS boss

So highly respected, so admired and so clever - top of his 800-strong class at Harvard - but it was his strategy, adopted from the Bank of Scotland when it merged with Halifax, that got HBOS in the trouble it is now. Who would have thought that the mighty Halifax could be brought to its knees and teeter on the verge of nationalisation?

Sir Fred Goodwin, former RBS boss

Once one of Gordon Brown's favourite businessmen, now the prime minister says he is "angry" with the man dubbed "Fred the Shred" for his strategy at Royal Bank of Scotland, which has left the bank staring at a £28bn loss and 70% owned by the government. The losses will reflect vast lending to businesses that cannot repay and write-downs on acquisitions masterminded by Goodwin stretching back years.

Adam Applegarth, former Northern Rock boss

Applegarth had such big ambitions. But the business model just collapsed when the credit crunch hit. Luckily for Applegarth, he walked away with a wheelbarrow of cash to ease the pain of his failure, and spent the summer playing cricket.

Dick Fuld, Lehman Brothers chief executive

The credit crunch had been rumbling on for more than a year but Lehman Brothers' collapse in September was to have a catastrophic impact on confidence. Richard Fuld, chief executive, later told Congress he was bewildered the US government had not saved the bank when it had helped secure Bear Stearns and the insurer AIG. He also blamed short-sellers. Bitter workers at Lehman pointed the finger at Fuld.

A former bond trader known as "the Gorilla", Fuld had been with Lehman for decades and steered it through tough times. But just before the bank went bust he had failed to secure a deal to sell a large stake to the Korea Development Bank and most likely prevent its collapse. Fuld encouraged risk-taking and Lehman was still investing heavily in property at the top of the market. Facing a grilling on Capitol Hill, he was asked whether it was fair that he earned $500m over eight years. He demurred; the figure, he said, was closer to $300m.

Ralph Cioffi and Matthew Tannin

Cioffi (pictured) and Tannin were Bear Stearns bankers recently indicted for fraud over the collapse of two hedge funds last year, which was one of the triggers of the credit crunch. They are accused of lying to investors about the amount of money they were putting into sub-prime, and of quietly withdrawing their own funds when times got tough.

Lewis Ranieri

The "godfather" of mortgage finance, who pioneered mortgage-backed bonds in the 1980s and immortalised in Liar's Poker. Famous for saying that "mortgages are math", Ranieri created collateralised pools of mortgages. In 2004 Business Week ranked him alongside names such as Bill Gates and Steve Jobs as one of the greatest innovators of the past 75 years.

Ranieri did warn in 2006 of the risks from the breakneck growth of mortgage securitisation. Nevertheless, his Texas-based Franklin Bank Corp went bust in November due to the credit crunch.

Joseph Cassano, AIG Financial Products

Cassano ran the AIG team that sold credit default swaps in London, and in effect bankrupted the world's biggest insurance company, forcing the US government to stump up billions in aid. Cassano, who lives in a townhouse near Harrods in Knightsbridge, earned 30 cents for every dollar of profit his financial products generated - or about £280m. He was fired after the division lost $11bn, but stayed on as a $1m-a-month consultant. "It seems he single-handedly brought AIG to its knees," said John Sarbanes, a Democratic congressman.

Chuck Prince, former Citi boss

A lawyer by training, Prince had built Citi into the biggest bank in the world, with a sprawling structure that covered investment banking, high-street banking and wealthy management for the richest clients. When profits went into reverse in 2007, he insisted it was just a hiccup, but he was forced out after multibillion-dollar losses on sub-prime business started to surface. He received about $140m to ease his pain.

Angelo Mozilo, Countrywide Financial

Known as "the orange one" for his luminous tan, Mozilo was the chairman and chief executive of the biggest American sub-prime mortgage lender, which was saved from bankruptcy by Bank of America. BoA recently paid billions to settle investigations by various attorney generals for Countrywide's mis-selling of risky loans to thousands who could not afford them. The company ran a "VIP programme" that provided loans on favourable terms to influential figures including Christopher Dodd, chairman of the Senate banking committee, the heads of the federal-backed mortgage lenders Fannie Mae and Freddie Mac, and former assistant secretary of state Richard Holbrooke.

Stan O'Neal, former boss of Merrill Lynch

O'Neal became one of the highest-profile casualties of the credit crunch when he lost the confidence of the bank's board in late 2007. When he was appointed to the top job four years earlier, O'Neal, the first African-American to run a Wall Street firm, had pledged to shed the bank's conservative image. Shortly before he quit, the bank admitted to nearly $8bn of exposure to bad debts, as bets in the property and credit markets turned sour. Merrill was forced into the arms of Bank of America less than a year later.

I really did not see this "disappointing" December ... especially not at Walmart. Are they jumping on the "oh retail situation sucks" bandwagon or was December actually disappointing for them? I just can't comprehend what kind of sales these people are planning around ...

Ok I understand the higher end retailers are suffering ... good ... I have never been one to pay like $60+ for a pair of pants anyway. Just basic $20 cargos do it for me. Let them suffer and maybe they'll start offering some more reasonable merchandise. But Walmart? I just don't get it.

The Amero - The New United States Currency?

There have been many rumors flying around that the countries the United States of America, Mexico and Canada will give up their currency and adopt a new unified currency called the “ amero.”

With the Federal Reserve Bank printing dollars at will the value of the dollar is bound to decrease as it has over the last decade. The amero is expected to have a gold and silver backing rather than be solely based on paper, so the money cannot be “ printed.”

Ideas of the amero have been swirling since 2006 and it is highly doubtful that it will ever come to truth, but it is an interesting concept to think about. The United States Constitution mandated that we use silver and gold coins as money or to at least back our money. It seems that our country has definitely gotten away from this idea. Do you think a new United States currency is in the near future?

• A leading IT Company Lycos-Armenia is closing down. The administration has informed the staff about the company's closure at a special meeting minutes ago.

   

  Employees were notified of the menace of closure weeks ago.

   

  Lycos-Armenia is a development and operations center for the business units of Lycos Europe. The company employs some 1000 people, the best specialists of the sphere. Presently, the company neither confirms nor denies the information.

   

  Details will be given later in the day.

• According to the operative data of the National Statistical Service of Armenia, Armenian economic growth was 9,2 percent in January - October of this year compared with the same period of last year.

   

  GDP exceeded AMD 3 trillion.

   

  It's worth to mention that the economic growth was within the limits of 10 percent during the whole year besides spring months.

   

  The rate of growth has been decreased in the spheres of construction and services during the last years, though they recorded the highest indexes of growth before.

   

  Growth in construction was 6,9 percent, services - 13,3 percent.

   

  The volume of construction decreased by about 41 percent in October compared with September.

   

  Fortunately, the rate of growth in industry has increased. 4 percent of growth has been recorded here in January - October of this year.

   

  Volume of industrial output increased by 2,5 percent (without electric energy production). The latter increased by 5,8 percent.

   

  Gross agricultural output increased by 1,8 percent in January-October, retail trade turnover - 7,9 percent.

   

  Foreign trade turnover increased by 31,5 percent to USD 4 billion 520 million. Export volume rose a little (0,9 percent) to USD 941 million.

   

  Import increased by 42,8 percent to USD 3 billion 579 million.

   

  The negative balance of export-import was USD 2 billion 638 million. Cars, equipments continue to remain dominant in import.

   

  Medium monthly wage was AMD 89 thousand in August; in the private sector - AMD 110 thousand, in the public sector - AMD 63 thousand.

   

  The average growth in the wages was 19,8 percent compared with the same period of last year.

• By Ara Martirosian, translated by L.H.

http://www.econtalk.org/

What if we legalized all drugs?

How

does a $50 billion boost to the US economy sound? Not bad? Well, what

about all the new addicts we could see pop up on the streets?

Theoretically, it's all possible.By Shirley SkeelEvery year, about 2 million people

in the U.S. are arrested for drug offenses, including using or selling

marijuana, heroin, cocaine or methamphetamine. About a third of the

country's prisoners are held on drug charges or for crimes attributed

to drug abuse.But what if we legalized all street drugs?More

kids would decide to try drugs "just once," and more would get hooked.

Some lives would be ruined. But other lives would be saved. Gang

murders would fall sharply. Thousands of people now in jail would be

free to find work and feed their families. We'd save billions on the war on drugs, and a new drug industry would create jobs and loads of taxable revenue.Of course, it may sound like madness. And the gut feeling among many people is that it would be disastrous. Don Semesky, the former chief of financial operations for the Drug Enforcement Administration in Washington, D.C., asks: "Have you ever seen a meth addict, with all those sores and rotten teeth? And what they do to their kids? Do you want the government to be responsible for that?Yet some economists, including American Nobel laureate Milton Friedman,

have supported the idea of legalizing drugs. Friedman believed

America's war on drugs was at the root of police corruption and caused

thousands of unnecessary deaths, with few gains for ordinary citizens.So just how would legalized drugs affect the economy and your standard of life?Running some numbers Let's

look at two scenarios: if marijuana alone were legalized and if all

street drugs were legalized. Either way, we assume there'd be strict

regulation similar to that for alcohol and cigarettes, including age

limits, licensing, quality control, high taxes and limits on

advertising.At first glance, on a "strictly numbers" basis, the effect on the country's pocketbook looks promising. We'd see:Savings

on drug-related law enforcement -- FBI, police, courts and prisons --

of $2 billion to $10 billion a year if marijuana were legalized, based

on various estimates, or up to $40 billion a year if all drugs were

legalized, based on enforcement costs from the White House's Office of National Drug Control Policy. That's before the cost of overseeing the new drug regulations.Increased

productivity as fewer people were murdered, drug offenders were freed

to find work and those stripped of their criminal record found it

easier to get jobs (including running drug boutiques). However, how

many of those now in prison would turn away from crime is unknown.Video on MSN Money Pot UniversityOne school starts a certification process to sell medical marijuana, CNBC's Jane Wells reports.Tax

gains. Drug prices would have to fall sharply in order to squeeze out

the black market. Still, Jeffrey Miron, a senior lecturer in economics

for Harvard University, calculates the $10 billion-plus U.S. marijuana

market could reap $6 billion in annual taxes. The $65 billion market for all illicit drugs, he estimates, might bring in $10 billion to $15 billion in taxes.A

new legal drug industry would create jobs, farm crops, retail outlets

and a tiny notch up in gross domestic product as the black market money

turned clean. A 1994 study by the National Organization for the Reform of Marijuana Laws in Washington, D.C., suggested 100,000 jobs and 60,000 retailers could emerge from a legal marijuana industry.So,

seemingly we'd get a shower of money for the government coffers --

perhaps an initial $50 billion under the "all drugs" scenario -- and

gains for business and the community. But at what cost?Talk back: What's your view on legalizing all drugs?The answer is that it all depends, mostly on how many more people would use drugs, which drugs and how much more they used.Give me a latte and a joint Currently, considering it can get you arrested (or kill you), drug use is surprisingly common. A 2006 federal government study said 20% of Americans 18 to 25 had taken an illicit drug in the month prior to the survey.So what if a Starbucks-style chain of drugstores that fulfilled Abbie Hoffman's

wildest dreams opened across the country? What if you could sit on a

sofa, pick up a magazine and light up, or even shoot up, in a congenial

atmosphere?

Continued: The Netherlands

*

6695 real estate bargains were implemented in the country in January 2006. Their quantity has increased about 9,9% compared with the data of January 2005. Out of the 2801 real estate bargains made in January 88,0% formed the buyings and sellings, 10,9% - donations and 1,1% exchanges. The 36,8% of the bargains took place in Yerevan. The quantity of the bargains of the blocks of flats in the capital has reduced by 1,4% campared with the data of the January 2005, and by 35,8% compared with the data of December 2005.

The monthly increase of the average market price of the blocks of flats in marzes, with the exception of Yerevan, reached 3,9 % per one square in January 2006.

According to the Press Service of the Real Estate Managing State Agency judging by the survey of the price indexes they can conclude that the monthly increase of the average market price of the private houses in Yerevan was 2,9% per one square in January 2006.

On the whole, about 1038,61 acre lands were aliened in the republic (including102,01 acre in Yerevan) in January 2006, the 876,44 acre of which had an agricaltural importance. By the way, selling and buying bargains were implemented on 1017,91 acre lands (including 101,76 acre in Yerevan) , the 857,57 acre of which was of agricultural importance.

Made in Armenia

[september 10, 2007]

Hetq is beginning a new series of articles called Made in Armenia, aimed at presenting the activities of Armenian companies that export products to foreign markets and the problems and challenges they face.

Armenian products are recognized in the international market by a unique 13-digit bar code, which Armenia received in 1996 from the international organization GS1 (www.ean-int.org). GS1 developed a coding system which has allowed the international recognition of products and services in a unique and accurate manner. In other words, this is a common language, which importers and exporters can use to gain information about a given country's products. The first three digits of the bar code stand for the country, the following 6 refer to the company, the next 3 code for the product, while the final digit is a check and is determined by a specific algorithm based on the previous digits. The base code for products made in Armenia is 485. If any product bears a code beginning with these digits, it has been manufactured in Armenia. Armenian companies can obtain bar codes at the GS1 Armenia office (www.gs1am.org).

http://archive.hetq.am/img/h-0907-noyan-1.jpg “I Don't Feel the State's Support in Any Way Today”

The Noyan brand of juice, manufactured in Armenia, is currently exported to 25 countries around the world – France, Sweden, the United Arab Emirates, Belgium, Australia and others, but mainly Russia, America and Ukraine. The Noyan juice manufacturing plant has been operational since 1998. Everything has been done from scratch and today Noyan produces around 3 million liters of juice annually. The workload is greatest in the months during summer and fall. Nowadays, the plant is busy producing peach juice. Women seated in rows around tables were removing the stems and pits of sour cherries, in order to make jam. “I've been working here for the past three years, mainly during the fruit season. I make 2,000 drams a day and it's also good for me because I live nearby. We put labels on around 6,000 jars of jam or preserved fruit every day,” said Narine, a worker at the plant.

http://archive.hetq.am/img/h-0907-noyan-2.jpg The company currently exports more than it imports [fruits which do not grow in Armenia are imported as raw material for the juices – L.N.]. 50 percent of the juice is consumed in the domestic market and the other 50 percent is exported. Vahe Ghazaryan, executive director of the Noyan manufacturing plant and founder of the family business, said that the weakening of the dollar against the dram greatly lowered the potential of the company to develop. “We were forced to raise the price of the exported products. I can give you an example to illustrate the situation. With our prices last year, our partners would have offered us a contract for 10 boxes, while today's prices have attracted a contract for 4 boxes. Of course, those 4 boxes are an improvement over last year's 3 boxes, but the difference is obvious.”

The executive director said that the appreciation of the dram was not the only issue. The company's cargo reaches its destination months later – it takes 80 days to get to America and 40-50 days to reach Moscow. A similar amount of time is lost on the imports as well. Transport by air would cost more than the product itself.

In 2001, the company bought a new processing unit which concentrates the fruit – the fruit is processed, condensed and preserved in conditions making it possible to use in the winter as well as export. “We only keep 20 percent of our fruit concentrate for ourselves at our plant. We sell a very small portion of the remaining 80 percent to local ice-cream and candy manufacturers and export the rest,” said Vahe Ghazaryan. Many people are unaware of the fact that the reprocessed raw fruit made by Noyan is sold to the Russian and Ukrainian companies which produce Sandora , Jaffa and other well-known brands of fruit juice, which are then imported to Armenia. There are 40 brands of juice in the domestic market today.

http://archive.hetq.am/img/h-0907-noyan-3.jpg http://archive.hetq.am/img/h-0907-noyan-4.jpg

By 2003, Noyan had already gained recognition in the American and Russian markets. “The consumers of Noyan in America are mainly ethnic Armenians and Russians from the former Soviet Union. In Russia, we organized tasting events and gave customers free samples in shops for months in order to secure our place in the market. Now, every tenth resident in Moscow knows that Noyan is a brand of fruit juice, that it is of good quality and expensive,” said the executive director. In his opinion, it is very difficult for Armenian producers to gain a footing in foreign markets and entails major expenses.

The Armenian businessman noted that it was difficult to compete not just in the foreign market, but in the domestic market as well. “The conditions for competition in the domestic market are not fair, many businessmen do not play by the rules. The customs and duty systems have many unwritten allowances for them. All that is obvious to us. We are 143 rd in the list of top taxpayers. But there are juice importers who have a market that is three times that of ours, but are not on the Tax Department list.” In 2003, Noyan had 40 percent of the juice market, today it holds 10-12 percent. The businessman felt that Armenia lacked the preconditions for having a stable business. “We cannot call our work stable, we make new strategic decisions every month and develop a new pricing policy. We take loans but don't know what the dollar will be worth tomorrow or how to work accordingly,” said the executive director, “I don't feel the State's support in any of the issues regarding my business today.”

http://archive.hetq.am/img/h-0907-noyan-5.jpg http://archive.hetq.am/img/h-0907-noyan-6.jpg

Today, Noyan produces 18 kinds of juice, 16 flavors of jam and 8 kinds of preserved vegetable. Asya Hayrapetyan, head of the preserves department, has been working in the company since day one. Her job is to supervise operations and to propose new flavors of preserves.

http://archive.hetq.am/img/h-0907-noyan-7.jpg “We don't sell any vegetable preserves in Armenia at all, because our plant has been unable to keep up with our foreign orders. We sell our jams in Armenia and people especially love the walnut, fig, mulberry, cherry and rose flavors,” Hayrapetyan said. “We are trying to bring in a new unit to increase our volume of vegetable preserve production, so that we can present some of our product to the domestic market as well. But now that the unit is here in Armenia the customs department is saying that is isn't a processing unit, it's something else. We face similar problems every day,” the businesswoman complained.

300 people currently work at the plant, with the number dropping to 200 in the off-season. The average salary of the staff is 150,000 drams. The company bought 80 hectares of orchard last year. “Three years from now, 80 percent of our fruits will be from our own orchards. We came to this decision because we wanted to be able to supervise the whole process of fruit cultivation. We want to have ecologically pure products, for which we need to know how our fruits and vegetables are grown. This has not gained much attention in Armenia so far, but ecologically pure products are double the price in Europe. Now we are preparing documents so that we can ask the corresponding European institutions to give us the status of a company producing ecologically pure products. This is a great advantage,” said Ghazaryan.

The raw material used in Noyan juice, jam and preserves is currently bought from Armenian villagers by the company. Peaches are grown in the villages of the Artashat, Armavir and Ararat provincial regions at 70 drams to the kilogram.

“I think that Armenian exporters need to present products in foreign markets that are of good quality and expensive. No Armenian producer can fill huge orders, we have to work for a narrow circle of consumers, but offering good quality at a high price. Producers working in Armenia should not go for lots of money, but rather for great variety, if they want to continue living and working in this country,” said Vahe Ghazaryan, executive director of the Noyan juice plant.

Lena Nazaryan

The Armenian government plans to spend thousands of US Dollars this year to advertise the country as an attractive tourist destination and especially its winter resort town Tsakhkadzor, on CNN and Euronews.

Mekhak Apresian, head of a department at the trade and economic development ministry, dealing with tourism, told Armenpress that the government will release to this end 180 million Drams (some $600,000), as much as it did for 2007.

Also a resort town of Jermuk in the Vayots Dzor province, where the eponymous mineral water is produced, has now a cable road. Its construction was launched in late April of 2007.

The government released 1.3 billion Drams from its reserve funds to that end. The cable road is 1000 meter long.

The cable road is to give a push to tourism development and make the town more attractive for holiday-makers not only in summer, but also in winter.

Mekhak Apresian told Armenpress that the cable road will be officially opened in mid-January.

According to the A.E. Dram has lost more then 5% in the past few days.

What effects do you think the confrontations of March 1st 08 will have on Armenias' Economy?

Do you think this was a planned attack on the economy through destabilization of the government?

Even if the government saves people from foreclosure on their homes, they are still poor. They will not spend anything in order to help the economy.

Socialism is equality by dragging everybody down.

By Antony P. Mueller

[Posted March 8, 2005]

When confronted with complaints about the falling value of the dollar, the U.S. official is said to have responded to his European visitors: "The dollar is our currency, but it's your problem." That was in 1971. The politician to whom this statement is attributed was John Connally, who at that time served as the secretary of the U.S. Treasury. His boss was Richard Nixon, the same President who used a word for the Italian lira which politeness prohibits repeating. Nevertheless, Connally and Nixon made clear how matters were.

In the meantime, the Italian lira no longer exists. It has merged into the euro, when the single European currency was established in 1999. The endeavors to create a common currency had begun in the early 1970s, when the Europeans began to construct their own currency systems based on stable exchange rates and off the dollar standard.

The Bretton Woods System (named after the resort where the conference took place in New Hampshire in 1944) bestowed a singular privilege to the U.S. when the dollar became the point of reference for the new currency system. With the other member countries fixing their currencies to the U.S. dollar, and the U.S. dollar officially fixed to gold at 35 dollars per troy fine ounce, it seemed as if an ideal combination had been found to avoid international monetary disruptions.

The gold anchor was meant to curb an excessive production of U.S. dollars. When foreign countries had a trade surplus, they theoretically could have used the excess dollars and asked the U.S. to exchange them for gold. With a fixed parity between dollar and gold, this would have restricted dollar creation. However, France was one of the only countries that took the agreement literally and demanded that the U.S. exchange the earned dollars for gold instead of accumulating them as international reserves like other countries did which had persistent current account surpluses such as Japan and Germany.

The system as it evolved in the 1960s provided a free ride for the United States, and it did not take long for the U.S. to abuse this privilege. Pursuing the goal of expanding the welfare state along with ever more active foreign military involvements, the U.S. could no longer fulfill the agreement of making foreign currencies exchangeable into gold. The gold shortage of the late 1940s and of the 1950s had turned into a dollar glut. World inflation began its rise.

Under the transformed system, the need for adaptation was unilaterally transferred to foreign currencies. The system, which had once foreseen the change of currency parities as the exemption rather than the rule, entered into a phase of high instability when fixing and re-fixing of foreign currencies to the dollar became increasingly necessary.

In 1971, with the so-called "Smithsonian agreement," a final attempt was made to save the old system when the U.S. devalued its currency against gold and a series of other currencies, but soon it became clear that the Bretton Woods System was no longer viable. In 1973, with the adoption of the new rule that each country could choose its own currency arrangement, the Bretton Woods System had come to an end.

Since then, the international monetary system is more like a "non-system" than a "system," or, more precisely, the international monetary system consists of a multitude of different currency arrangements ranging from currency unions and currency blocs to freely floating exchange rates with many other schemes in between such as unilateral fixed parities, managed floating or currency boards, and currency baskets.

As early as 1970, the members of the European Economic Community, which later transformed into an expanded European Union decided to prepare for the establishment of a common currency. In 1999, the euro as a common currency was instituted, first for banking transactions and then, on January 1, 2002, as the sole legal tender in the member countries of the euro area. Currently, twelve European countries take part in the European Monetary Union.

In terms of absolute valuation, the euro is not very much of a better currency than the U.S. dollar. In economic decision-making, however, things happen on the margin and decisions are taken based on relative valuations. Given similar degrees of liquidity and financial market sophistication, the euro has become increasingly attractive for currency diversification, particularly due to the favorable foreign investment position of the euro area compared to that of the United States.

After some initial weakness—probably due to fears that the new arrangement might fail—the euro has gained markedly in value against the U.S. dollar over the past three years. The American currency is facing a rival. An increasing number of central banks announced plans to shift part of their international reserves into the European currency. The dollar is still the currency of the U.S., but a sinking dollar is no longer just a problem for foreigners, it is also a problem for the United States.

In the past, the United States could count on having the monopoly of issuing the currency with the highest degree of liquidity and financial market integration. Although there were stronger currencies than the U.S. dollar, such as the Swiss currency or the Japanese yen and the German mark, these currencies could not rival the U.S. dollar because of their limited market share.

The existence of the euro has changed this constellation. As to its market size, the euro area is up to the U.S. dollar with the tendency of further augmenting this position when new members of the European Union will adopt the single currency, some non-EU countries will peg their exchange rates to that of the European monetary union or when oil producers will change to euros when pricing their exports.

For a while in the 1990s, it appeared as if the U.S. dollar could regain its unique position. The 1990s saw Japan—the apparent commercial threat to the U.S. in the 1980s—sink into a prolonged stagnation. Germany, the other major player in the international trade arena, began to entangle itself in the morass of a costly and economically ill-conceived unification process.

After the fall of the Soviet Union and the dissolution of the Soviet Empire, the United States had emerged as the sole global military might, and, so it seemed, also as the undisputed economic and political power with global influence and far-reaching dominance. On this basis, the role of the dollar as the major reserve currency and the main currency for international transactions experienced a second spring.

In the 1990s, the new global constellation could be interpreted as the replay of the endings of World War I and World War II with the United States emerging for a third time on top of the world. In the 1990s, the triad of global dominance seemed well in place of the United States: an unrivalled military might, a booming and innovative economy and the only issuer of a global currency.

Since the turn to the 21stcentury, however, these factors of dominance have increasingly come under challenge. The mania of the New Economy has ended. The U.S. economy still registers high growth rates due to unrelenting consumption spending, but regarding its productive capacity, it is in a precarious state, as it is indicated by the persistence of high trade deficits. The military power of the United States in its present form is largely inefficient with respect to the relation between financial costs and political outcome. Finally, and probably most important, the dollar no longer holds the monopoly of being the only available international reserve currency.

While after 1919 and after 1945, the United States emerged as the largest international creditor, the U.S. became the world's largest debtor nation in the course of the 1990s. Also in contrast to the earlier world wars, the economies of Russia, Western Europe, and South East Asia were not devastated when the Cold War ended. As to their productive capacity and financial resources, these regions are on an even footing with the United States or even are superior—at least concerning their foreign investment position.

The performance of the U.S. economy in the past century owes much to the role of the U.S. dollar in the international monetary system, and a large part of attaining this role was the result of the political and military supremacy that the United States had gained since 1919. In the 20th century, the position of the U.S. dollar in the world represented a major underpinning of the prosperity at home, which in turn fed back positively on the dollar's foreign role.

As long as fiat money rules, currencies, particularly the standing of the dollar and the euro, also reflect their value as a "political currency." They represent the degree of global political and financial power and in turn they provide the basis for attaining supremacy. They are tools in the hands of governments in the struggle for dominance.

With the dollar privilege passing, the U.S. confronts a radically different situation than in the past, and a tormenting process of changing the accustomed world-view is on the horizon. However, even as of now, the role of the euro as a rival to the U.S. dollar is rarely a subject of concern in the United States. It is the same with additional power shifts that are going on, all of them potentially reducing or even eliminating the dominant role of the U.S. currency in the world economy.

New alliances are emerging that neither politically nor militarily may be benign to the United States. Also, older powers have maintained their might. The Soviet Union has disappeared, but Russia remains a military power matching the nuclear overkill capacity of the United States. China is beyond any immediate control or persuasion by the United States.

The current U.S. President identified an "axis of evil", composed of countries with relatively modest economic, financial, and military clout—and situated far away from the shores of North America. But how about the other axis that is being formed, right at the U.S. border and stretching down the South American continent. The alliance between Fidel Castro of Cuba, Hugo Chavez of Venezuela, and Lula da Silva of Brazil? What about the constant rumors that Brazil strives to become a nuclear power? What about the deals that are being made between Latin American countries and China with the perspective of forming an economic symbiosis between China's need for food and oil, and this region's abundance of natural resources?

Then there is another axis that has come into existence in the past few years: the fraternization between the leaders of France, Germany and Russia. This entente covers the Euro-Asian continent, the geo-strategic heart of the world. It represents an alliance that is ready and capable of challenging U.S. influence in almost any aspect. What do these constellations imply for the role of the U.S. dollar?

Anytime soon one may expect that countries like Russia or Venezuela and other oil producers will turn to the euro as the currency for their oil exports. The move to the euro as a currency for international transactions and reserves during the past couple of years may represent only the initial stage of long-lasting process. Currency shifts of such proportions start slowly but over time they will gain more momentum. By now, the euro may have passed the threshold that had limited its global use. Once a means of payment is widely accepted, it becomes increasingly more attractive for a wider use.

There is a consensus currently among the major players in international finance, particularly among the relevant governments and central banks, that an abrupt fall of the dollar should be avoided. Japan, the largest foreign holder of U.S. assets, depends on U.S. protection in the face of the growing muscle of China in its region. China itself most likely would also like to avoid a dollar crash at least as long as it has not yet spent a considerable part of its dollar reserves in the effort to secure future supplies of food and oil around the world. The Europeans do not want a much weaker dollar because as of now it is mainly exports that are booming in the major economies of this region.

In contrast to the wishes, however, the fundamental geo-strategic trends call for a reduced global role of the dollar. While the temporary interests of the major global players are directed at maintaining dollar stability and thus avoiding a rapid demise of the dollar's role as a global currency, these desires are not congruent with the longer-term aspirations of the foreign players themselves.

The international monetary system has entered a stage when it becomes more difficult to manage a conflict that is getting out of control the longer it lasts. Inexorably, the constellation moves to a point where the potential loss will outweigh perceived benefits—not only for the holders of U.S. dollar reserves, but also for the United States itself.

Under such conditions, economic and financial decisions in the private sector are prone to be made under false premises. One must not forget that three of the most essential prices in the modern monetary economy are politically determined or manipulated prices: the oil price, interest rates, and the exchange rates. Taking away the interventions, the price that the U.S. pays for imported oil, and the price for money and credit should already be much higher than they currently are. At their present levels, they reflect a position of the U.S. dollar in the global system that can hardly be maintained.

Given the importance of these three prices for the economy and their potential direction, it is not difficult to assess the prospect for asset prices, particularly those of stocks, bonds, and real estate which all must come down when the fall of the dollar continues.

http://www.mises.org/fullstory.aspx?Id=1759

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Lena Nazaryan February 04, 2008

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http://hetq.am/uploaded/image/articles/2008/01/0108-manana.jpg When the thyme leaves blossom residents of nearby villages begin to harvest the herb from the lofty meadows around Sisian, Kapan and Goris. The fragrance of the thyme is much ore pronounced in these areas and the oil content of the herb is rich.

The company Bio Universal, LLC, purchases the thyme from the residents in its dried state and produces tea, oil, syrup, tinctures and seasonings from the herb.

Yuri Chilingaryan, the firm's French Director, says that, " Some 3,200 herbs grow in Armenia of which 1,500 are medicinal plants. Many such plants are only to be found in Armenia. Based on this fact we've decided to select the better known varieties and produce teas, essential oils and condiments from them."

Tea is produced from the thyme's flowers and oil from the stems. The rest of the herb is used to make seasonings for appetizers and cheese aged underground. For example, one gram of thyme essential oil can cure 100 kilos of meat. It neutralizes the meat's odor and prolongs its shelf life.

These products are also used for curative purposes. Thyme tea regulates the body's metabolism, cleanses the body of the negative properties of alcohol and narcotics and stabilizes blood pressure. Thyme oils refresh and rejuvenate the skin. Joint pain can be eased when the affected areas are massaged with thyme essential oil. Just the aroma of the herb itself is sufficient to kill off certain bacteria.

These items are used to produce medicinal remedies as well since the herbs contain potassium, calcium and magnesium, among other elements.

Bio Universal began operations two years ago. During this period teas, syrups and oils made from blackthorn, hawthorn, rose hips, mint, peppermint and other medicinal herbs were added to the product list being sold under the "Manana" brand name.

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These herbs are also known for their curative properties. Hawthorn syrup, for example, strengthens the contractions of the heart muscle and improves blood flow to the heart and brain as well as regulating heart rhythm. Blackthorn syrup contains anti-inflammatory properties and is known to regulate body metabolism.

While these herbs were traditionally in Armenian medicine, Armenian consumers today are more attracted to the black and green tea varieties more commonly found in the market.

One of the reasons is that these 'Armenian teas' are expensive when compared to other tea types. One packet of thyme tea, for example, has an intrinsic value of 1,300 drams and is sold in stores for 1,560 drams. One gram of thyme essential oil is valued at around $5. This cost factor doesn't allow for large quantities of product to be sold in the Armenian market.

http://hetq.am/uploaded/image/articles/2008/01/0108-manana-1.jpgMr. Chilingaryan says that, "In addition to the fact that these products are expensive to begin with, there's also the 20% VAT (value added tax) tacked on as well. This further complicates matters for the small-scale producer. We have packaged and stored away much of our product line but it's been a year already that we haven't been able to sell it in the market. Our thyme and rose hip items are stored but haven't yet been packaged. At the same time we're ready to produce more and expand our production capacity that today only amounts to 25-30% of total capacity."

The Director adds that, "In exchange for the high price what we offer the consumer is a quality product. Our tea is only made from thyme leaves and flowers. There are many other thyme teas sold in the market in the form of crushed and dried leaves. This allows for a host of additives to be included to add weight to the product. Often, other fragrances and pigments are added as well. In this sense our product is ecologically pure and thus more expensive."

There's a trick that the consumer can use to insure that they're buying pure thyme without any additives. The flowers of the herb open more fully when placed in hot water than cold. Also, a bag of thyme tea, once used, produces a more fragrant drink and a more brilliant color the second time around.

For this small company even the packaging of its products is an expensive luxury, especially if the firm intends to enter the foreign market. Bio Universal imports a special wrapping paper to package its herbs. This wrapping preserves the natural fragrance of the plants.

Special technologies are employed in the processing of the herbs and the production of the essential oils and syrups. The oils are produced only by using equipment fashioned from glass. Metal cannot be used since at the high temperatures employed in the production process, metallic elements can fuse with the oils. The tea leaves are separated both by hand and by being extruded through sieves. Any dust on the plants is removed by air filtration.

The Director of Bio Universal states that the Armenian market for his company's product line is quite small. Thus, the firm views any future growth solely linked to the foreign market.

The whole world is interested in Armenian tea - from China, Greece Syria, Russia and several African countries. Contract orders with foreign buyers are presently being negotiated.

hetq

ARKA News Agency

Jan 30 2008

Armenia

YEREVAN, January 30. /ARKA/. The turmoil in the global mortgage market

and the stock market crisis have not affected Armenia's banking system

and economy, said Edward Aghajanov, former head of the RA National

Statistical Service (NSS).

The economist believes Armenia is not involved in the development of

the global mortgage and stock markets.

"No equity market works in Armenia, and it is senseless to say those

world processes may somehow affect our county," Aghajanov said.

He pointed out that in 2007 only the Armeconombank and the ACBA-Credit

Agricole Bank were granted syndicated credits at $15mln and $12mln

respectively.

The economist believes this money is not enough to think of possible

influence of the global financial crisis on Armenia's banking system

and economy.

The turmoil in the global mortgage market has affected the USA,

as well as European and Asian countries directly involved in the US

equity market.

Capitalization in the Armenian Stock Exchange (ARMEX) totaled AMD

3.2bln (0.1% of GDP) in 2007.

The Swedish OMX Financial Services Company became the absolute

shareholder of ARMEX and the Central Depositary of Armenia on January

7, 2008. The company plans to develop the county's stock market soon.

http://groong.usc.edu/news/msg218697.html

PS: Who said isolation is bad???

SINGAPORE (Reuters) - Stocks tumbled across Asia as panicky investors feared a U.S. recession could derail global economic growth, and a sharp drop in U.S. stock index futures pointed to heavy selling in New York later on Tuesday.

Share markets from Tokyo to Sydney slumped 5-7 percent, with the Australian market suffering its worst-ever one-day fall, and India's benchmark Sensex crashed more than 11 percent, triggering a trading halt.

Industrial metals such as zinc and copper plunged and oil fell well below recent record highs, prompting investors to flee to safe-haven government bonds.

Billionaire investor George Soros said the world was facing the worst financial crisis since World War Two and the United States was threatened with recession.

"We really do have a serious financial crisis now," Soros told Austrian daily Standard in an interview.

"It's like a funeral in here," said Ken Masuda, senior equities dealer at Shinko Securities in Tokyo. "No one knows what's going to happen tonight in New York. It's like we've gone blind, you don't know what's coming.

"Until we see New York, all we can do is sell," he said.

U.S. stock index futures fell around 4.5 percent, signaling a sharp sell-off on Wall Street later.

Reuters.com

http://www.nyse.com/about/listed/lcddata.h...=1D&index=0

A new US$32.2 million Farmer Market Access Program in Armenia, supported by a US$ 11.9 million loan and a US$500,000 grant from International Fund for Agricultural Development (IFAD), will provide innovative financing for poor rural and peri-urban people to develop profitable on-farm and off-farm small businesses.

IFAD said in a press release that the program will provide loans to people who develop rural microenterprises that have the potential for rapid growth but are held back because they can’t qualify for conventional bank loans.

The loan agreement was signed January 8 at IFAD headquarters by IFAD’s President Lennart Bage and Armenia’s Ambassador Extraordinary and Plenipotentiary to Italy Ruben Shougarian.

The OPEC Fund for International Development will co-finance the program for US$10 million. Other co-financiers will contribute US$2 million; the Government of Armenia US$5 million; participating financial institutions US$900,000; and project participants US$2 million.

“Once they are able to access credit, poor rural producers will have many more opportunities to develop profitable and commercially viable products and services all along the market value chain,” said Henning Pedersen, IFAD’s country program manager for Armenia. “More rural enterprises will also mean new jobs for people who have not been able to find work.”

The programmer’s main financing instrument will be a venture capital fund – the Fund for Rural Economic Development in Armenia (FREDA) – which represents an innovation for both rural Armenia and IFAD.

Those applying for financing under the program will have to show that their enterprise will foster sustainable income growth among the program’s target groups, which include farmers and unemployed, under-employed and self-employed people. Applicants for FREDA support who engage women as suppliers and employees will be given preference.

The program will also help participants gain access to the knowledge, technology and infrastructure they need to enable them to profit from domestic and export markets.

Improved access to roads, small-scale irrigation and village gas supplies are also part of the program. Participants will contribute a minimum of 10 per cent in cash or in kind to overall infrastructure costs, and participate in infrastructure design, supervision, operation and maintenance.

IFAD has financed five programs and projects in Armenia since 1995, investing a total of US$64.2 million. IFAD investments in the country support poor farm families so they can produce a surplus to be sold for additional income. Small- and medium-scale rural service providers such as traders, processors and suppliers also are targeted for support because of their important role as links between farmers and markets.

IFAD was created 30 years ago to tackle rural poverty, a key cause of the droughts and famines of the early 1970s. Since 1978, IFAD has invested almost US$10 billion in low-interest loans and grants that have helped more than 300 million very poor rural women and men increase their incomes and provide for their families.

IFAD is an international financial institution and a specialized United Nations agency. It is a unique partnership of OECD, OPEC and other developing countries. Today, IFAD supports more than 200 programs and projects in 84 developing countries.

Thursday, Jan. 03, 2008 By JUSTIN FOX (TIME MAG.)

Yes, they'll drain Social Security by 2041. But the money problems will begin long before then.

They're turning 62 this month, the first of the baby boomers are. Adorable, aren't they, as they hum along to the Beach Boys on their iPods and dream of Davy Crockett coonskin caps? In February the 100,000 or so of these January 1946 babies who opted for early retirement will get their first Social Security checks (averaging between $900 and $1,000 a month), marking the beginning of a demographic wave that will boost the program's rolls from 50 million to 80 million over the next two decades. Not so adorable, eh?

You've heard about the pending retirement of the boomers before, of course. You've also heard that Social Security faces some big funding problems. The two have less to do with each other than you might think. Social Security's insolvency remains a hypothetical threat decades into the future. But because of the particular way its funding was rearranged by Congress in 1983, the rest of the Federal Government, as well as taxpayers, will begin feeling the cost of the boomers' retirement in just three or four years.

Let me explain. In 2041 the trust fund that pays Social Security benefits is projected to run out of money. After that, a yawning gap between benefits and income stretches as far as an actuary's eye can see. This long-term gap is what President George W. Bush was trying to address with his failed plans to partly privatize Social Security. It's been the focus of almost all recent debate about the program.

Most of the baby boomers, though, will be dead by 2041. I was born in 1964, considered the final year of the boom, and according to the Social Security Administration, I should expect to keel over by the end of 2042. So it's not we boomers but long-run trends in immigration, fertility and life expectancy that are projected to leave the program chronically short of funds after that.

The trends can only be guesstimated, and that inherent uncertainty is cited by blithe spirits as reason not to do anything about Social Security. Worrywarts, meanwhile, argue that the distance of the looming bankruptcy is all the more reason to make changes calmly now. Both arguments have merit, but it's the former that is almost certain to prevail. Previous Social Security fixes came only when the checks were about to bounce, and that dire moment is decades off.

Such a funding crisis was just months away in 1983 when a bipartisan gang led by Senators Bob Dole and Daniel Patrick Moynihan cracked heads and persuaded Congress to move up some already planned payroll-tax hikes and shove back the full retirement age to 67 for future generations. Since then, Social Security has run a surplus. From an actuarial standpoint, this mostly solved the problem of funding the boomers' retirement. It also meant that the boomers will, as a group, put more into Social Security than they get out. (That's true of all age cohorts born since 1937; it's the Social Security recipients born before then who have, as a group, made out like bandits.)

The catch is that the surplus was invested in U.S. government bonds, to be cashed in later to keep the by-then-elderly boomers afloat. These bonds are simply claims on future U.S. taxpayers, and they're coming due. The Social Security surplus peaked in 2000, at 0.91% of GDP. It has held steady for the past couple of years but is expected to start shrinking fast in 2011. By 2017, Social Security should begin to run a deficit, one that's projected to grow sharply through the mid-2030s.

The crisis projected for 2041 is that the bond stash will run out. The semicrisis set for 2011 is that Social Security will quickly go from the big boost to federal finances that it has been for the past 25 years to a big drag (a drag greatly exacerbated by the cost of paying for Medicare for the boomers, which is another story).

Something will have to give. Big changes in Social Security itself seem out of the question, so federal taxes other than payroll taxes will have to go up, government spending outside of Social Security will have to be cut, or budget deficits will grow. Or, most likely, a combination of all three. And it will begin to hit during the first term of whoever gets elected President in November. Not that you'll hear much talk about that on the campaign trail.

This is a short documentary on Russia vs Georgia in economic terms.

It's very interesting and kind of ironic too.

Shows how the West, mostly Americans of course, still think of Russia as a backward socialist country where people are still waiting in the lines for bread since the early 1990's.

Armenia definitely needs a strong and patriotic leader like Vladimir Putin to get things in order. Who knows maybe in 50 years we will have our own Putin....Putinyan that is.

http://www.businessweek.com/globalbiz/cont...age_top+stories

Armenia a Model for Developing Nations

Economic reform and investment by Armenian expatriates have helped the country boost GDP by more than 10% a year for a decade

BusinessWeek

October 23, 2007

by S. Adam Cardais

To appreciate just how far Armenia has come in the last 15 years, it helps to imagine yourself living through an Armenian winter in the early 1990s.

It's the middle of January, it's five degrees below zero, and you and your family have only two hours of electricity a day -- such was the abysmal state of the energy sector in a country crippled by the dissolution of the Soviet Union, a traumatic earthquake in 1988, and war with neighboring Azerbaijan.

But Armenia has been "radically transformed," in the words of one World Bank official, since its independence from the former Soviet Union. Today, the average Armenian has electricity around the clock.

An influx of cash and a series of reforms have taken Armenia from economic basket case, with GDP plummeting 50 percent between 1990 and 1993, to "Caucasian tiger," to quote a World Bank report issued earlier this year. It has become a model transition economy that should continue prospering with a second wave of reforms.

GDP has increased more than 10 percent a year for a decade largely thanks to robust investment in a booming construction industry by the Armenian diaspora in Europe and the United States. Sharp growth in the services sector, including the financial sphere, and retail trade are also contributors, according to the European Bank for Reconstruction and Development.

"Given the fact that it doesn't have natural resources, its growth is quite impressive," says Heike Harmgart, country economist for Armenia at the EBRD.

And the most laudable aspect of that growth, World Bank economist Aristomene Varoudakis says, is "that macroeconomic stability has been preserved. Inflation has remained low," between 3 percent and 4 percent. Last year was an exception to this trend, with inflation climbing to 5.6 percent, but the International Monetary Fund forecasts a fall to 4 percent in 2007.

REFORMS REAP REWARDS

This fiscal discipline is an indication the government has backed up the bountiful diaspora remittances, which are more good fortune than anything else, with sound policy. Indeed, remittances alone don't make Armenia a model transition economy. A series of early, sustained governmental reforms enabled the country to capitalize on the cash inflow.

For instance, the government eliminated wage controls and privatized the majority of land and small businesses in the mid 1990s to encourage investment in construction and other sectors. The central bank has also been a key reformer, streamlining its operations and improving supervision over the banking industry to spur a dynamic financial services sector in a short period.

More recently, a new credit bureau to bolster small business lending and a modernized bankruptcy law have further improved the investment climate, two reasons Armenia ranks 39th out of 178 economies in the World Bank's "Doing Business 2008" report.

On all of these reforms, Armenia has been wise to cooperate closely with international institutions such as The World Bank and the IMF.

"The Armenian government has been listening to institutions very well, which is positive," Harmgart says. "The government has always been open minded."

It would be hard to overstate the benefit this economic revolution has brought the population. According to the World Bank report, the poverty rate has fallen from more than 55 percent in the early 1990s to 30 percent. Extreme poverty had dropped to 5 percent two years ago.

GENTRIFYING NEIGHBORHOOD

The good news for the region is that Armenia's prosperity isn't unique. Georgia's economy is growing at just under 10 percent and is one of the leading reformers in the world, at No. 18 on the "Doing Business 2008" report. Azerbaijan posted a whopping 34.5 percent GDP growth in 2006 thanks to its thriving oil industry.

As in these countries, though, there's still a lot of progress to be made in Armenia. Tax evasion remains rampant. It's extremely costly for an individual or business to file taxes, and tax revenues are only 15 percent of GDP, one of the lowest rates in the region, resulting in less money for strengthening the economy or fighting poverty through spending on education or health care.

The government is trying to increase tax compliance by introducing a system that allows payers to submit their returns by post or electronically, publishing a list of the country's largest contributors in a sort of ego-driven motivator, and opening specialized collections units, but more progress is needed.

Corruption, though becoming less pronounced, is also a major concern, as is Armenia's over-reliance on the construction industry. Though analysts predict Armenia will sustain double-digit growth in the short and medium term, it has to begin diversifying its economy by making trade more dynamic and attracting new knowledge-based investments, such as IT companies.

Reforms in corporate transparency, competition, and education will be central to realizing this goal, but "these are more complex reforms than the first round," Varoudakis points out.

Armenia has without a doubt taken great strides, but nothing highlights progress like starting from nothing. If the country wants to remain a "Caucasian tiger," it had better prioritize these difficult reforms now.

These will take a lot longer than turning on the power.

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