Correct Figures and False Reality: Serzh Sargsyan’s Speech during the RPA Congress

On November 26, during the 16^th Congress of the Republican Party of Armenia, among many other issues, RA President Serzh Sargsyan addressed the dynamics of development of Armenian economy during the last few years.  During his speech, he introduced a few economic indicators which, according to the President, are a testament to the rapidly developing economy and continuous growth of the living standards of the Armenian population. For the sake of justice, it should be noted that, in absolute terms, the statistical figures are correct but their interpretation not so much.

In President’s words, the minimum wage in 2015 has noticeably increased reaching 55.000 AMD compared to 20.000 AMD in 2007, and the average monthly pension has reached 42.000 AMD compared to 12.746 AMD in 2007. And hence, according to the President, the growth of living standards is obvious. In terms of figures, these indicators are correct but, nonetheless, they have nothing to do with the increase of living standards for ordinary citizens. According to official data, the price of consumer basket in 2015 has grown by 60% compared to 2007. This means that the average prices for goods have increased by 0.6 times. But even this indicator does not fully reflect the reality since the consumer basket includes goods which are never used by pensioners and citizens who live on minimum wages.  These families are mostly concerned with prices for essential goods, and here the picture is much worse. As an example, we can mention that in 2015, the price for flour has increased by 82% compared to 2007, the price for bread has increased by 54%, animal oil – 105%, rice – 140%, cheese – 50%, and sugar – 38%.

As another proof of improvement of the quality of life, the President noted that the consumption of gas, electricity and water has continuously grown. But he did not talk about one important thing, namely, sharp increase in prices for these services. In 2015, the price for 1m³ gas has increased by more than 170% compared to 2007, reaching 156 AMD from 59 AMD.  In parallel, the price for electricity has increased by more than 95%, forming 48.78 AMD compared to the previous 25 AMD tariff. Even the price for drinking water has increased by 13.2%.

In such circumstances, it remains unclear what continuous growth of living standards and great economic achievements were they talking about during the congress of the ruling party.