Armenian Government to Make Cash Payments Amid Economic Shutdown

The streets of Yerevan are empty (Photo by ArmRadio)
The streets of Yerevan are empty (Photo by ArmRadio)

The streets of Yerevan are empty (Photo by ArmRadio)

YEREVAN (—The Armenian government approved on Monday unprecedented cash payments to scores of people who have been hit hard by economic disruptions resulting from the coronavirus epidemic.

The one-off payments announced by Prime Minister Nikol Pashinyan’s cabinet will benefit tens and possibly hundreds of thousands of workers who have been temporarily out of work or laid off as well as owners of small businesses forced to halt their operations in recent weeks. The aid is meant to help them buy food and meet other basic needs during the nationwide lockdown imposed in Armenia last week.

Armenians who have lost their jobs since March 13 will receive 68,000 drams ($137) each, while unemployed pregnant women whose husbands were fired in the same period will be paid 100,000 drams. Single and jobless pregnant women will also be eligible for this aid.

Government officials gave no estimates of the number of such citizens. They spoke instead of more than 100,000 people making up the third and largest category of aid recipients.

Among them are the employees of hotels, travel agencies, restaurants, clothing stores and other businesses that were closed after March 13. Depending on their monthly wages, they will get between 68,000 and 136,000 drams in compensation.

The government will pay similar sums to small-scale individual entrepreneurs also affected by the lockdown.

Speaking during a cabinet meeting in Yerevan, Pashinyan made clear that the government has no intention to compensate a large number of other Armenians who worked off the books and did not pay any taxes.

“This situation should tell us that all workers, all wages have to be registered [with tax authorities,]” said Pashinyan. “We can’t deal with unregistered cases [of employment and self-employment] because it’s a black hole where nobody knows what’s going on.”

Opposition politicians have expressed serious concern about the plight of people involved in the informal sector of the Armenian economy. They have urged the government to take care of them as well.

Deputy Prime Minister Mher Grigoryan did not rule out the possibility of such assistance when he spoke at a news conference later on Monday. He stressed, though, that the government currently sees no effective mechanisms for extending the coronavirus relief package to the “unregistered jobs.”

The government approved last week a set of other measures designed to shore up the economy. In particular, it said creditworthy firms and individual entrepreneurs will receive grants worth $500 million (just over $1 million) if they pledge to use that money to pay their workers’ wages, buy equipment or raw materials or pay taxes. The scheme will not apply to Armenian banks, insurance companies and casinos.

The banks will receive instead government subsidies to provide cheap credit to small firms and farmers. The latter will be able to borrow up to 1 million drams each and avoid paying any interest for two years.

Pashinyan also announced on March 27 that the banks have agreed to suspend loan repayments for some 100,000 individual or corporate borrowers.


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