Today marks 20 years of adopting Armenia’s national currency

Armenia’s national currency, the Dram, turns 20 years old today.

On November 23, 1993, the national currency unit was put into circulation, replacing the Soviet Rouble. On this remarkable occasion, Tert.am has interviewed Hrant Bagratyan, Armenia’s then prime minister, who now represents the parliamentary opposition.

Tell please the history of introducing the Dram.

The Dram was introduced by the Supreme Council [current National Assembly] as Armenia was in the Rouble zone until August 26, 1993. On August 26, Russia declared the new [national] Rouble. We had purchased the Dram, together with the Lumas, under one of the former prime ministers, I mean Gagik Harutyunyan, and asked Poland to transport the full amount to Armenia. Armenia’s economic records were the best in the CIS [Commonwealth of Independent States] as of January-October 1993. I took over the cabinet in late February, after the catastrophic decline. We were hopeful to get through 1993 with a relative economic growth and be the first among the CIS states. We got in touch with Moscow to know what precisely the new Rouble’s meant, and the response we got was the the Rouble would be made available only to the countries which Russia believed were to join an economic union. They said further that Tajikistan was the only candidate at the moment. That was the situation until late October. As early as in October, we were given a certain amount of the August 26 Rouble. On October 18, we met with the Russian government’s expanded staff together with [first] President Levon Ter-Petrosyan. They clearly told us that Armenia was very unlikely to qualify for the Rouble. The International Monetary Fund too, insisted - until the summer of 1993 0 that we avoid switching over to the national currency. We were back from Moscow on October 18. And we applied to the Supreme Council, proposing the Dram as the national currency. We did not have a serious law on the Central Bank then. So the cabinet initiated the new law. After consultations, the Supreme Council made a decision to launch the Dram. The process was entrusted to the Supreme Council Committee (Tigran Sargsyan, Levon Barkhudaryan, Isahak Isahakyan).

And what did the cabinet do then? How was the Dram introduced?

When the Dram was introduced, it was [current Prime Minister] Tigran Sargsyan’s decision to propose the 1:45 ratio. The cabinet proposed that the ratio be 1:40. The Dram had 20 times lost its value upon being launched; had our proposal been passed, it would have been devaluated by five times. After the situation took a catastrophic turn 10 days later, the cabinet applied to the Supreme Council [warning of] a danger of losing the republic. It proposed that all the functions of managing the Dram be vested with the cabinet. The National Assembly did not pass the law, but the cabinet was de facto vested with those authorities. We then launched several stock exchanges with rapid efforts and established a market [exchange] rate, abandoning the “fixed” 1:14 ratio. In the period spanning from October until January, I recorded a growth, but the introduction of the dram in such a way spoiled everything. In 1994, we already managed to ensure an economic growth, being the first in the CIS area.