Squat, Shengavit, Yerevan, Republic of Armenia © Onnik Krikorian / Oneworld Multimedia

Emil Danielyan, the English language editor for RFE/RL’s Armenia Service web site, writes for Eurasianet that western donors are upbeat on economic growth in the country. Emil writes that “A consensus is building among economic experts that the tiny South Caucasus state is finally emerging from its post-Soviet doldrums.”

Officials from the International Monetary Fund (IMF) and other donor organizations now believe that decade-long growth in Armenia has produced a sizable reduction in poverty. “Armenia is on a promising path toward sustained high growth and the alleviation of poverty,” Agustin Carstens, the IMF’s deputy managing director, said at the end of a mid-July visit to Yerevan. In May, the IMF expressed its approva of Armenia’s economic directionl by offering a three-year, $34-million loan agreement.

Interestingly, as I also know Emil, another acquaintance is quoted in the article. Brian Kearney is the Chief of Party of the Armenia Social Transition Program (ASTP)-PADCO and as I’m on contract to him, I’d better be careful what I write! Seriously speaking though, I have a great deal of respect for what both these guys write or say.

Brian Kearney, who runs a US government-funded project to reform Armenia’s social security system, said economic growth has had a visible impact on living standards, adding that it has also lifted the public mood. “There is a new buoyancy and a new confidence that wasn’t here five years ago. It might seem a small thing but, for me, just the change in people’s demeanor and approach to life is remarkable.”

“Five years ago it was very much hanging on,” Kearney added. “Now I see people striding forward.”

Emil goes on to write about the growing inequality between those with and without money and for me, I think that this is the saddest phenomenon of all in any country. In Armenia and other transitional countries, however, that gap is obviously more severe than in the West.

However, some economic analysts view official figures with skepticism. For instance, many analysts believe the official poverty line of about 13,000 drams ($30) per month is set too low given the rising cost of living. The National Statistical Service of Armenia (NSSA) estimated in a 2003 report that the average Armenian family spent two thirds of its income on food — a telling indicator of persisting hardship.

“The consumption of high-priced food products such as meat products, milk products, fruits and eggs is very low,” the report said. The government agency also asserted that many Armenians still cannot afford adequate healthcare as “only one in three persons with health problems applied to a doctor for medical care.”

Still, the trend is positive and I think that if other aspects of transition such as the need to fight endemic corruption were tackled, then the situation could be better. For example, despite economic growth since 1995, tax collection is still low although improving and the state budget can not cover the increasing needs of the most vulnerable in society.

The full article can be read online here and some recent photographs I shot for ASTP-PADCO can be found online here, here and here.