For the first time in the history of the World Economic Forum in Davos a Russian politician – Prime Minister Vladimir Putin delivered the keynote speech. The speech was followed by Panel Discussions.
This question asked by Michael Dell, CEO of PC manufacturing giant Dell, during the Panel Discussions grabbed my attention. Dell asked “how can we, as an IT sector help you broaden the [Russian] economy as you move out of the crisis”, Putin responded – “The trick is we don’t need any help”. “We are not invalids,” he said. “We don’t have limited mental capacity, we are not pensioners.”
Frankly, I quite liked Putin’s response to Michael Dell… I mean – Dell is a struggling IT company, who would benefit greatly from widening its presence in the Russian market. So I guess it was basically a silly question of him to ask – to formulate the question that way.
Manaseryan is sure that appreciation of national currency hinders strengthening competitiveness of goods and services of local producers. It is not the only factor to hinder economy, there are also economic and political factors, he said. Nevertheless, the expert is sure that the process of the appreciation of Armenian dram results in rise of prices of goods both produced in the country and imported.
“Over the last months our currency proved the strongest currency in the world even comparing to dollar, euro and pound sterling”, he said.
Such control of exchange rate may lead to large-scale panic among the population and resumption of dollarization. In such situation the expert thinks that to gradual reduction of the Armenian dram rate in the background of devaluation of the basic world currencies would be the most justified step.
He advised the economic leadership of the country to wage more flexible monetary policy. The expert said the control over the rate that was to lead to reduction of prices in the country actually leads to rise of import prices since the prices for imported products are left unchanged despite the landslide cut of prices in the world market. This also affects the solvency of the population and increases social tension.