Wednesday, June 3 2020 16:22
Alina Hovhannisyan

Ara Karyan: Increase of gas tariffs for Armenian business entities  should not be allowed 

Ara Karyan: Increase of gas tariffs for Armenian business entities  should not be allowed 

ArmInfo. A substantial format  for resolving the issue related to gas prices is based on the  introduction of an excise tax on energy products. Chair of the  "LOGIKA" (NGO) Independent Research Center of Business, Economy and  Finance, a candidate of economic sciences, associate professor of YSU  and RAU Ara Karyan expressed a similar opinion at the June 3 press  conference.  At the same time, he noted due to the closure of  borders, labor migrants will not be able go to seasonal work, serious  problems should also be expected with the country's balance of  payments.  "Of course, the balance will more or less be maintained,  but its organization will change," the economist said. Karyan called  for a reconsideration of the decision to increase gas prices for  business entities, in which case negative consequences for the  Armenian economy cannot be avoided.  

The Public Services Regulatory Commission (PSRC), in his words,  should refer this issue to the Government of Armenia, which will not  violate the law, because, as Karyan noted, there is an article  allowing the cooperation of the latter.

"The government needs to hire several independent expert groups to  identify whether there are reserves in Armenia to cover that $ 15  increase in gas prices," he said. If gas prices are reduced, Armenia  should introduce an excise tax on energy products. <This reserve will  go to replenish the budget, and will not lead to higher prices.  We  don't have to pay anything extra, but the budget will be  replenished>,  said Karyan, noting that a similar approach has long  been applied in Europe.  

To note, on June 4, the Public Services Regulatory Commission (PSRC)  will hold regular discussions on the new gas tariffs proposed by  Gazprom Armenia.  According to the press service of the regulator,  representatives of  public organizations involved in consumer  protection will become  participants in the upcoming discussions.   According to the  information posted on the PSRC website, the  Commission proposes to  maintain the final tariff for individuals in  the amount of 139  thousand AMD per 1 thousand cubic meters of blue  fuel versus 135  thousand proposed by Gazprom Armenia. PSRC also  considers it  necessary to leave unchanged the size of the tariff for  socially  disadvantaged groups of the population- 100 thousand drams  per 1  thousand cubic meters.

At the same time, the rate of tariff for gas  consumed by greenhouse  farms will increase slightly. In particular,  instead of 283.14 AMD  proposed by the gas monopolist, PSRC proposes  setting a tariff of  224 AMD instead of current 212 AMD.  For  agricultural processing  enterprises, instead of 212 AMD, the  Commission currently considers  the option of 224 AMD acceptable instead of 283.14 drams proposed by  the company. Tariff for natural gas up to 10 thousand cubic meters  sold to thermal power plants will remain the same - 139 thousand AMD  per 1 thousand cubic meters instead of 135.9 thousand AMD  proposed  by the company.  For consumers who consume more than 10 thousand  cubic meters per month, the tariff will be set at $ 255.92 instead of  $ 283.14 offered by Gazprom Armenia CJSC.  

To recall, speaking at the online summit of the EAEU leaders on May  19, Prime Minister of Armenia Nikol Pashinyan stated that global  challenges dictate the EAEU the urgent need to form a common gas  market. "The formation of a unified system of gas tariffs is a  necessity that is felt especially urgently in Armenia. I am convinced  that the common market will contribute to increasing the  competitiveness of goods by increasing the potential of the EAEU many  times. Without this, ensuring equal business conditions for all  states is impossible," he stressed.  

In response, Russian President Vladimir Putin pointed out that a   single gas tariff in the EAEU implies a single market, a single   budget, a single taxation system.  Meanwhile, a similar level of   integration in the EAEU, according to his estimates, has not yet been   achieved. Accordingly, while prices should be formed on the basis of   market conditions. Taking into account costs, investments, providing   profit for suppliers. "The formula of the EAEU countries for gas  prices proposed by the draft EAEU Development Strategy until 2025 is   supported by Russia, Kazakhstan and Kyrgyzstan. Our Armenian and   Belarusian counterparts have not yet accepted this formula," Putin   said.

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