Armenia’s 2018 uprising has paved the way for a “technological revolution” in the country, Prime Minister Nikol Pashinyan said on Monday (7 October), as the Black Sea Economic Cooperation group rallied around the use of technology for regional collaboration.
Referring to the recent growth of the tech export markets in Armenia, Pashinyan said the country had a newfound “confidence” following last year’s uprisings.
“The ongoing economic revolution will in turn lead to a technological revolution,” Pashinyan told the World Congress on Information Technology.
“We will be able to turn Armenia into one of the technological innovations leader in the world, a true technological centre,” he told participants at the congress, which takes place in Yerevan, Armenia, this year.
Armenia’s 2018 uprisings, dubbed the ‘velvet revolutions’ due to their peaceful nature, comprised of a series of anti-government protests in Spring 2018 which were led by Pashinyan, then a member of Parliament, alongside civil groups.
The protests had taken place in response to former Prime Minister Serzh Sargsyan’s consolidation of power in the country, as well as allegation of widespread corruption across government.
Following Pashinyan’s imprisonment for his part in the protests, the government eventually stood down and opposition parties all rallied behind the imprisoned leader, leading to his appointment as Armenia’s Prime Minister.
After the change in government, Armenia has adopted a liberal approach to trade and investment and is seeking to reposition itself as a nucleus of innovation in the Transcaucasia region. Along this axis, the country is hosting this year’s edition of the World Congress on Information Technology, which aims to highlight the potential of IT across public an private sectors.
The theme of this year’s congress is ‘the power of decentralisation’ – a leitmotif that the Armenians are yielding to highlight their newfound geopolitical strategy. Rather than forming hardline alliances with specific regional partners, the country is seeking to position itself as a “network nation,” a country that is able to maintain positive relations with different partners around the globe, Armenia’s Deputy Education Minister, Arevik Anapiosyan, told EURACTIV.
Armenia’s own relations with neighbours Turkey and Azerbaijan remain frosty. The Turkish government still fails to recognise its role in the 1915 genocide that nearly wiped out the rural Armenian community, while Armenia and Azerbaijan are at loggerheads over the sovereignty of the Nagorno-Karabakh region – a disagreement that escalated in 2016, resulting in violent conflicts.
Meanwhile, on Monday, Armenia’s Deputy Prime Minister Tigran Avinyan said that the theme of decentralisation being rallied by the country is directly related to the 2018 uprisings.
“The connection between the Revolution and the power of decentralization was that the main success of the Revolution was linked with the decentralization itself,” Avinyan said, responding to a question from EURACTIV.
“In April 2018, when various citizens of Armenia started carrying out actions in groups, blocking different streets in the capital Yerevan and the provinces, it was already clear that the Revolution was going to succeed because there was a new common logic which didn’t have central governance, people were just conducting actions of common logic in a decentralized manner.”
“The power of decentralisation is this that this phenomenon was out of control”, he added.
One specific area in which Armenia is seeking to attract tech firms to the region is by proposing attractive tax regimes, at a time in which global tech giants face the possibility of higher levies in the EU.
Prime Minister Pashinyan sat down with Senior Vice President at Pixar Animation Studios Katherine Sarafian and Rajiv Ramaswami, CEO of VWmare, on the sidelines of WCIT yesterday. The Prime Minister was unambiguous in saying that tech firms can obtain a series of benefits in the country, including a decrease in income tax for IT companies from January 2020 in addition to far-ranging privileges for start-ups.
Deputy Education Minister Anapiosyan told EURACTIV on Monday that the notion of a digital services tax for Armenia – an additional levy for tech firms operating online – was “definitely not a priority” for her country.
In addition, members of the Black Sea Economic Cooperation group convened on Monday, in a bid to support the rollout out of innovative technological solutions in the region. Moldova’s Economy Minister, Vadim Brinzan, said that IT companies are afforded the benefit of “separate tax environments” in his country, while Olga Memedovic, Chief of Business Environment Cluster and Innovation Division at the United Nations Industrial Development Organisation, said that “innovation cycles are becoming shorter” in the region.
Meanwhile, in the EU, commissioners-designate have signalled their commitment to the idea of establishing a digital tax, in a series of written answers to MEPs published recently.
“If no effective agreement can be reached by the end of 2020, the EU should be willing to act alone” on a digital tax, said Margrethe Vestager, the incoming commission’s vice-president, who will be overseeing digital policy in the forthcoming executive.
Vestager has been tasked with the ‘poisoned chalice’ of digital taxation – incoming Commission President Von der Leyen expects the Dane to find a consensus at international level by the end of 2020 or to propose a fair European tax – a challenging task considering that a coalition of member states banded together to block the plans earlier this year, and an agreement in the OECD is unlikely.
It’s not surprising that Vestager has obtained authority in this field – as the signs have been there for many months that she had wanted to impose her political influence on the digital tax plans. In April, she told told France Inter radio that “we are becoming an increasingly digital world and it will be a huge problem if we do not find a way to raise (digital) taxes.”
In addition, in 2020 the Commission is to present sweeping reforms to age-old eCommerce rules, dubbed the Digital Services Act – a far-reaching and ambitious regulatory framework that seeks to govern the online ecosystem.
Moreover, within the first 100 days of the Commission’s new mandate, staring on November 1, Vestager will also coordinate work on a European approach to artificial intelligence, including its ethical implications.
Amid the EU’s attempt to maintain a grasp on the digital ecosystem, Armenia conversely is seeking to position itself as a liberal marketplace open for business, despite domestic difficulties still plaguing the global reputation of the country – including high unemployment rates and poverty.
For Pashinyan, however, technology may offer the country a solution to its many problems. The long-term objective, he says, is to make “the technological sphere a driving force for our economy.”
[Edited by Frédéric Simon]