Corruption in Armenia

Regulation of mineral industry in Armenia carries multiple corruption risks, as it was highlighted by international research.[12]

Despite the success of the authorities in reducing petty corruption/bribery in some citizen-government interactions, anti-corruption watchdogs report that entrenched corruption, strong patronage networks, a lack of clear separation between private enterprise and public office, as well as the overlap between political and business elites limit the effective implementation of anti-corruption efforts. These problems affect the education system too. It is perceived as one of the sectors that is hit hardest by corruption. Attempts to fight the problem have brought mixed results and often opened new opportunities for malpractice instead of closing the existing ones.[13][14]

The notoriously corrupt Armenian State Revenue Committee (housing both the Armenian Customs Service and the Armenian Tax Service) helps maintain import monopolies as well as aid tax evasion.

In 2007, World Bank economists pointed to serious problems with rule of law and widespread corruption in the Armenian tax and customs agencies.[15]

In March 2004, an ad hoc commission of the Armenian parliament investigating the use of a $30 million World Bank loan concluded that mismanagement and corruption among government officials and private firms was the reason of the failure of the program to upgrade Yerevan's battered water infrastructure.[16] The World Bank issued the loan in 1999 in order to improve Yerevan residents' access to drinking water. The government promised to ensure around-the-clock water supplies to the vast majority of households by 2004, but as of 2008, most city residents continue to have running water for only a few hours a day.[16]

Veolia Environnement, the French utility giant that took over Yerevan's loss-making water and sewerage network in 2006, has said that it will need a decade to end water rationing.[16] In August 2007, Bruce Tasker, a Yerevan-based British engineer who had participated in the parliamentary inquiry as an expert, publicly implicated not only Armenian officials and businessmen but also World Bank representatives in Yerevan in the alleged misuse of the loan. In an October 4, 2007 news conference, the World Bank Yerevan office head Aristomene Varoudakis denied the allegations, claiming that the World Bank disclosed fully all information available on the project to the parliamentary commission and that based on this information there was no evidence of fraud or mismanagement in the project.[16]

Northern Avenue residents protest the proposed demolition of their building through signs and posters, 2011.

Eminent domain laws[17] have been used to forcefully remove residents, business owners, and land owners from their property. The projects that finally are built on the site are not of state interest, but rather are privately owned by the same authorities who have executed the eminent domain clause. A prominent example is the development of Yerevan's central Northern Avenue area. Another involves an ongoing project (as of November 2008) to construct a trade center near Yerevan's botanical garden. The new land owners are non other than Yerevan's mayor Yervand Zakharyan and Deputy Mayor Karen Davtyan, who was at one time Director of the Armenian Development Agency and successfully executed the eviction of residents on Northern Avenue.[18]

Traffic police residing along major highways, such as those connecting traffic between Tbilisi and Yerevan frequently extort passing traffic for bribes in exchange for forgiving "traffic violations". Tourists are especially targeted, with the police openly requesting ~5,000 Armenian Dram per bribe. Violations are often fabricated, and police target local and foreign drivers alike.