State loans to be repaid

Azat Artsakh – Republic of Nagorno Karabakh (NKR)
May 1, 2004


The meeting of the NKR government discussed a number of draft laws and
decisions of important social-economic role for the country. The
meeting was conducted by the NKR prime minister Anoushavan Danielian.
Minister of finance and economy Spartak Tevossian presented
information on the bill “On confirming the annual account on execution
of the NKR state budget of 2003”, the first point in the
agenda. During the discussion the bill was approved and it was decided
to send the draft law to the parliament. In his speech prime minister
Anoushavan Danielian dwelled on the necessity to restore the repayment
of loans provided by the NKR government formerly. All the members of
government who addressed the meeting supported him. The heads of the
corresponding agencies and the regional administrations were tasked
with scheduling the procedure of repayment of expired loans and
present suggestions on restructuring of loans to be included as a
source of current incomes during drawing up the budgets of communities
starting with 2005. The prime minister wondered on the low rates of
loan repayment and the tolerable attitude of the supervising agencies
and demanded taking strict measures in reference to
lawbreakers. According to him, the process of repayment is not
coordinated duly. He considers unacceptable the fact that having a
strong state structure the legal levers of influence upon the
lawbreakers are not used adequately to return the sums. A. Danielian
mentioned that new programs of loaning will be considered only after
the full repayment of the former loans. The government members
discussed the NKR bill “On Confirming the annual account of 2003 on
implementation of the 2002-2003 program of privatization of state
property”. As a result of this program the number of private
enterprises grew, and the efficiency of their activity is illustrated
by the fact that 62.9 percent of the GDP of NKR is provided by the
private sector. The purchasers of the privatized companies implement
in a short period of time their payment obligations to the NKR state
budget and the NKR state pension fund. Of the 23 privatized companies
13 companies or 56.6 percent were put out to tender, 8 companies or
34.8 percent were privatized through direct sale, and 2 companies or
8.7 percent were privatized through direct free extension. The new
owners of the privatized companies assumed the obligations of making
investments and providing social guarantees to the personnel
(maintenance of jobs, stable salary, etc.) the receipts from
privatization totaled 347 million drams (of which 283.8 million drams
from privatization of state property in 2003), including privatization
of companies 290.5 million drams, privatization of units of the
inventory of the companies 24.7 million drams, small and half-ruined
buildings 31.5 million drams and unfinished buildings 1.2 million
drams. The total sum of the obligations transferred to the purchasers
of the privatized companies in 2002-2003 is 447.7 million drams. Of
the 75 companies included in the program 23 were privatized and 9
companies were dissolved according to the NKR government
decisions. The execution of privatization and dissolution of companies
in 2003 was 42.7 percent against the 14.8 percent of 2002. In
comparison to 2002 the number of privatized companies increased
twice. The account provides the real picture of the process of
implementation of contract obligations. According to this, a number of
companies (enterprises) did not implement their contract obligations
at full. In the past years purchasers of 14 companies privatized by
investment programs and whose term of implementation of contract
obligations has expired assumed making 1729 billion drams of
investments and opening of 359 jobs. The amount of investments made
totaled 2219.6 million drams and 580 jobs were created. According to
the mentioned rates, implementation of obligations was 128.3 and 161.6
percent respectively. The members of the government approved the
bill. Among the questions in the agenda was the account on
implementation of the 2003 state program of development of small and
medium-size business, which was presented by the NKR vice minister of
development of industrial infrastructures and building A. Abrahamian.
It includes the period from January 2003 to January 1, 2004. Starting
from the financial capacity of the foundation the loan resources (with
volume restrictions) were directed at the communities providing
territorial symmetry of development of small and medium-size business,
as well as for implementation of large business plans the means of the
debtor were involved. Mainly the business plans presented for
viticulture, orcharding, cattle breeding and fish breeding,
fabrication of food and agricultural products were loaned. Last year
138 applications for loan were presented to the foundation but
starting from financial abilities, 43 applicants received loans with
the total sum of 180 million drams. A. Abrahamian mentioned that the
granted sums were mainly used according to the business plans, there
were a few exceptions. After the interference of the board of trustees
of the foundation definite steps were taken at implementation of
business plans. Stressing the importance of loaning aimed at
development of small and medium-size business the prime minister
emphasized that the process must be absolutely transparent for
everybody and the mass media must inform the public about the business
plan and even the personal data of entrepreneurs. The meeting of the
government discussed a number of bills on simplification and
improvement of the tax system. Decisions were made on granting aid to
definite groups of the NKR population on the occasion of the Day of
Victory, the Liberation of Shoushi and the NKR Defence Army. Decisions
were made on continuing the process of reforms in the structure of the
police, on establishment of the governmental institution “the
personnel of the regional administration”, on confirming the code and
structure of the personnel. The executive also confirmed the bills on
the number of free and paid places in NKR state higher educational
institutions for the academic year 2004-2005 and the lists of
specialties of admittance to master=E2=80=99s course and postgraduate
course of Artsakh State University for 2004.=C2=A0=20