The Diagnos of Economy
From January 2009, Business Pareta LLC has implemented the Local Economic Development
Program in the communities of Sarukhan and Vardenik, of Gegharkunik region. The program includes three main components.
1. Evaluation of economy of the community and clarification of competitive advantages.
2. Planning of 18 to 20 business ideas, with business men of the community, based on the community’s competitive advantages.
3. Support of businss idea implementation in the way of financial consultation, and support of promotion in the market.
These communities have been selected out of 40 communities of the regions of Gegharkunik, Tavush, and Lori, in the result of advancing through many stages for the selection process.
Since the 11th of February, 2009, Business Pareta LLC has implemented evaluation of the community’s economy in Sarukhan of Gegharkunik region. Participatory Appraisal of Competitive Advantages (PACA), a methodology of Local Economic Development, was used for analyses. The program is implemented with the direct support of the local government. In this stage of the program, 8 active stakeholders of the community were included.
During discussion with local team Business Pareta, LLC Local Economic Development Program Sarukhan
Results of the Program
Sarukhan is one of the largest communities, not only in Gegharkunik, but also in the Republic of Armenia. More than half of the income of the inhabitants comes from working abroad; the other half is formulated from the selling of agricultural products. Three small factories operate in the
The main branch of Sarukhan’s economy is potato production.
The current main spheres of the community are based on competitive advantages of the community, but the community has some other competitive advantages which are not currently utilized.
The competitive advantages of Sarukhan are as follows:
- Mineral sources,
- Ploughs and pastures,
- 70% of the land has irrigated water,
- High quality carpet-makers,
- Natural monument named Gri Dzor,
- Successful businessmen abroad,
- Officials from the village in different stages of state government,
- The number and pay ability of consumers in the community is great.
One of the issues of the program was to understand why the money coming to Sarukhan, about $40 million, is not circulated within the community –rather it goes outside of the community. Meetings and interviews showed that the offered services and products in the village are directed to inhabitants having low income, and the part of inhabitants which has about 70% of income in the community satisfies the demands outside of the community.
Since January 2009, Business Pareta, Ltd. has been conduction the Local Economic Development
program in the communities of Vardenik and Sarukhan of Gegharkunik region. The program
includes three main components:
1. Evaluation of communities’ economies and clarification of competitive advantages.
2. Planning of 18 to 20 business plans which are based on competitive advantages with the business men of the community.
3. Financial consulting support for realizing of business ideas.
These communities have been selected from forty communities in Gegharkunik, Tavush, and Lori based on different indicators.
From the 2nd to the 20th of February, 2009, Business Pareta, Ltd. realized an evaluation of the community’s economy in the village of Vardenik. The methodology of Participatory Appraisal of
Competitive Advantages (PACA) of Local Economic Development (LED) was used for analyzing the community. The program is implemented with support of the local government in the village.
In this stage of the program, eight active people in the community are included.
The Results of the Program
Vardenik is one of the largest villages in Gegharkunik and also in the Republic of Armenia. A great part of inhabitants’ income comes from working abroad. Another part comes from sale of agricultural products. There are four to five small productions in the community. The main
branches of economy in Vardenik are:
- Animal Husbandry
- Plant Husbandry
The main spheres of the community are based on some of the community’s competitive
advantages, but the community has some competitive advantages which are not yet used. The
competitive advantages of Vardenik are:
- Mineral sources
- Water-filled and large fertile valleys, ploughs, and pastures
- 70% of water and land has irrigated water
- The river of Vardenik, which has hydro-electric resources
- 3.6% fat content in milk
- Highly qualified cheese production specialists
- Unique church with two levels
- Kufta made by hemp
- Celebration of Vardavar
- Church named Shek Avetaran
- Customs and legends
- Large factories abroad
- The number of consumers of Vardenik, and their pay ability is great
- Animal husbandry: cattle, sheep, goat, rabbit
- Fish production
- Bee keeping
General research and analyses show that almost all products in the community are in the first stage
of the value chain, which brings little money to the community, and the products are in a great
competitive sphere. That’s why the suggestions are related to recommendations of new products
using competitive advantages of the value chain’s second and fourth stages.
Further developed branches of Vardenik can be:
These spheres are prospective based on further cultivation of them. The development of these
spheres is not possible without the existence of supporting businesses. Business suggestions are
noted in the results of the analysis.
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