Armenia's second president critical of PM Sargsyan's remarks on
construction decline
12:26 - 30.12.13

Second President Robert Kocharyan has explained the reasons of the
recent years' construction decline in Armenia, opposing to the
arguments brought by Prime Minister Tigran Sargsyan at the recent
end-of year news conference.

In an interview with, Kocharyan pointed out to three main
factors, noting that the incumbent prime minister's explanations have
nothing to with the reality.

The interview is provided below.

Mr President, though the New Year and Christmas holidays are drawing
near, Prime Minister Tigran Sargsyan's press conference continues to
remain in the media spotlight. It is interesting to know if any
answers or comments made during the press conference have attracted
your attention.

I will focus on one episode today. What caught my attention was the
prime minster's response to a journalist's question about the past
five years' continuing decline in the construction volumes in the
republic. Since the premier's explanation was unrelated with what we
are facing now, I will try to respond to that question myself.

So what has caused the uninterrupted unflinching decline in the
construction volumes in the past five years?

1. The population's exodus (I don't point to figures not to spoil the
festive mood). The potential buyers of new apartments leave, reducing
the demand on the real estate market. In the meantime, the apartments
of those families inevitably appear on the secondary market, creating
a surplus of supply. The reduced demand for property and the drop in
prices have seriously shaken the investment attractiveness in the
development sector. So the enumerated factors have suppressed the
delayed apartment demand effect since the sharp phase of the 2009

2. The essential deterioration of mortgage loan terms (if they can be
termed that way, at all). If we compare the terms we had in 2004-2007
with what we have today, you will see that few people in their right
senses would dare to benefit from the `mortgage loan'. And the
essential increase of the impoverished population which cannot even
dream of purchasing an apartment - let alone mortgage loans - adds to

3. Out citizens' mood. The apathy, the feeling of helplessness and the
lack of trust in future have come to steadily influence people's
behavior and motivation. Studies reveal that exactly 40 percent of
Armenia's population intends to permanently move [to another place]
once such an opportunity emerges. Anyone inclined to leaving [the
country] never purchases property in a country or town he or she
intends to quit. The same goes for business initiatives.

So these are the reasons behind the steady decline in the construction
volumes. Everything is more than clear and comprehensible. And the
former government is not to blame for this; neither are certain
aliens. The crisis too, is very far away now. So there's no way to
avoid responsibility here.

Armenian News -

From: Emil Lazarian | Ararat NewsPress