Thursday, November 09, 2006

Economic Development in Artsakh

The President of NKR, Arkady Ghoukasian, is on his way to the US to participate in the upcoming Armenia Fund 9th annual telethon in Los Angeles scheduled for November 23rd. Proceeds from this Telethon are to benefit the region of Hadrut in Artsakh. Projects include the construction of a hospital, schools, water pipelines, as well as drawing a regional development plan. The plan is similar to that of the Martakert Regional Development plan currently underway. Examples of the latter include the reconstruction in Shushi (see here) or Martakert Hospital (see here).

Last year’s Telethon raised USD 7.7 million in funds. These funds go a long way in helping the local economy and its infrastructure. The country also benefits from a number of foreign investments in its economy and growing tourism. GDP grew by 15 percent in 2005, but off a very small base. Indeed, GDP more than doubled between 2001 and 2005, from USD 53 million to 114 million. Construction grew by some 38 percent in 2005 (see here).

Obviously it goes without saying that Karabakh, with a per capita GDP of under USD 1,000, needs to grow faster and undoubtedly can use more assistance. My major interest rests with what is happening on the education front, higher education in particular. For Artsakh, as in the case of Armenia or any other country, aid is not a sure way to prosperity. Aid goes a long way, but it is the stock of human capital that is key to growth and expanding economic development and opportunities – making the desert bloom so to speak. But this takes more than just funding. Do we know much about Artsakh State University in Stepanakert? What fields do they teach? Where do their graduates go?