The most superficial analysis of the possible consequences of the ”Shock and Trembling” operation allows noting that the war may affect not only the political processes in the region, but also the economy and the social sphere of the country. The economic consequences will be stipulated first of all by the increase of the world prices for oil products which will become inevitable if the war lasts for long. The motorcar and the aviation transport, agricultural and military techniques will use the fuel at new prices not taken into account during the formation of the budget. The transportation expenses have a significant role while calculating the prime cost of the goods exported by Armenia. The increase of the prices for oil products may make the Armenian production less competitive in the world market. Regarding the urban transportation means, here it will be a little bit easier for the country to control the increase of the prices as the major part of the transportation park uses gas. The owners of passenger cars will suffer in this sense. The only thing calming is that the forecasted increase of prices for oil products will be temporal.
General instability of the situation in the Near East may affect also the accuracy of our trade and economic partners from Lebanon, Syria, United Arab Emirates and Israel. The businessmen of those countries have certain investment liabilities towards the Armenian companions, who are afraid of force majeure circumstances. The shock of the stock exchange often provoked by the military actions, may unexpectedly affect also the financial situation of the Western investors investing capital in Armenia.
Speaking about the consequences of the American military campaign on the economy of Armenia, here it is worth mentioning that the terms of the supply by the United States of the financial aid worth $90 million approved by the Congress may be changed. Though the military expenses were foreseen from the beginning by the legislators, there may be an extraordinary situation, when the administration will be obliged to allocate additional resources for the war. The Armenian government should be ready for such a turn of events. The lack of financial resources does not allow the Armenian government to guarantee the security of the numerous Armenian community of Iraq. The members of the Armenian community can not count on the help of Armenia. However, a certain part of the Armenian refugees will reach Yerevan. It will require expenses not foreseen in the state budget. Other countries of the region will also have similar problems. In general, the optimistic forecast of the President is based probably on the understanding that there are countries in the world the economy of which is much more sensible to the shocks caused by regional wars. On their background our problems seem rather surmountable.
