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New EAEU ban will increase the poverty in residential areas bordering Georgia

July 29,2017 14:33

The new requirements, approved by the Commission of the Eurasian Economic Union (EAEU), came into force on July 1, according to which only up to 5 kg phytosanitary products subject to quarantine control may be imported to the area of the Eurasian Economic Union without customs clearance. These include almost all kinds of fruits and vegetables. This has provoked anger and dissatisfaction among a number of citizens, particularly residents of villages bordering with Georgia, who had been importing fruits and vegetables from Georgia to resell.

While before the new requirements they were allowed to import up to 50 kilograms, which in the absence of jobs allowed the villagers, as they say, to earn their living. According to economist Vilen Khachatryan, if we consider these requirements of the EAEU from the perspective of the region, naturally, these villagers will suffer serious financial losses: “If this way they were able to solve their social problems, now they will be deprived of that opportunity”, says Mr Khachatryan, noting that if they start customs clearance for these products, the price of those will increase: “If they do custom clearance before selling, here the residents will be in noncompetitive conditions with importers, that is, the importer passes through the same process, the villagers had some competitive advantages by not making customs clearance and in some extent not passing through that process, now that competitive advantage disappears, such processes will not even be profitable for them to go, bring, make customs clearance, that is their work will no longer be financially expedient or justified. Which will cause dissatisfaction”. According to Vilen Khachatryan, if we look at the rules of the classic state or the rules of competition, then such steps are correct, but if we look at it from purely human, social point of view, from the point of view of these people being at the poverty threshold, such steps are wrong.

“Solve those people’s problems first create jobs, etc, and only then apply”, noted the economist. In response to the question of Aravot.am, whether in the region where people were trading to earn their living, the percentage of poverty may rise, Vilen Khachatryan said: poverty will increase, and people’s situation will deteriorate in some ways.

“If each of them was keeping a family, and if we talk about 50 persons, then at least 200 people will suffer, will start living worse”, said Mr. Khachatryan, expressing an opinion that such small-scale transactions should not “be put into this type of strict regulation”. “What should he do? Is he a big businessman? He merely keeps his family, it’s type of a self-employed work, that is he is a self-employed person, who tries somehow to earn his living. Why depriving him of an opportunity? But you are putting even this into regulation, and he has to leave the field”, said Vilen Khachatryan.

Lusine BUDAGHYAN

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