The Farms and Villages of Armenia
The Farms and Villages of Armenia

What Now for Armenia's Village Farmers?

From Boom to Bust and Starting Over Again

To speak about village life in Armenia is to speak about farming. But on the level that is most practiced across the republic, it is not the pastoral, bucolic definition of the term that idealizes love of land or the sensual satisfaction of earth-stained skin and the link established between humanity and Creator.

 It is to speak about struggle; about wrestling with nature to reach some accord, from which survival may be a payoff but is not a guarantee.

And in Armenia’s troubled history of the last 100 years, rural survival has as often been assaulted by the vagaries of man, as by the whims of nature, leaving, now, a vast community of the perplexed.

Armenian villagers, too, represent the irony of the times in which 40 percent or more of the population is in some way engaged in agriculture—the oldest occupation—and most without the inheritance of having come from farming families and the natural preparation for the task which they now continue to figure out, or not, as they go along.

And for the past 20 years, when villagers—once accustomed to state security—have looked for help from the seat of authority, they have found a government that, itself, is also trying to figure out its new place for which it, too, had no inheritance.

Consumed by collectivism

Bolshevik Russia offered Armenia something it needed most at the time: security.

Immediately after proclamation of Soviet power in Armenia, the government of Russia allotted a huge—3 billion Russian rubles—loan, along with 40 wagons of staples that were sent to the depleted country. Moscow also sent agricultural machinery and equipment. Yerevan, then, was little more than a frontier outpost, while the greater population was scattered in the areas from which Armenia would be established as an agrarian society.

In 1921 prerequisites were created in Soviet Armenia for transfer to a new economic policy. By government decree, all poor households were exempted from taxes, which in turn contributed to agricultural production and emergence in the market. At the same time, drafts were made on the development of the first agro-industrial entities, which were a synthesis of several economic branches—agriculture, power engineering, transport, and food industry.

By 1925 all the power-generating plants in Czarist Russia and the first Armenian Republic were restored and resumed operations; new hydropower plants were built. Measures were taken to recover the transport system in the republic and to lay new railways to promising future agro-industrial centers, in particular, canning factories built in the lowlands, which purchased fruit/vegetable produce and grapes. Meat-dairy livestock husbandry and farming households developed in the highlands.

It was due to these activities that in the period between 1921 and1924 Yerevan’s Ararat Wine and Brandy Factory was restored, and wineries in Artashat, Etchmiadzin and Ararat started operating along with new canning workshops. In the mid-1920s Yerevan’s tobacco plant that purchased tobacco grown in the northeastern regions of Soviet Armenia saw its first output.

Such economic policy fundamentally changed the course of development of Armenian villages. Many of the poor, who were given a piece of land, livestock and agricultural inventory, became peasants of average means and gradually turned into a central figure of their rural settlement. The fact that they were able to take their produce to the market or sell it to food industry factories helped to improve their standard of living.

Good idea gone bad

If history had stopped there, it would be ideal by many standards.

But history brought Josef Stalin.

In 1929 a period of total collectivization started in Armenia and throughout all the Union of Soviet Socialist Republics. It began with the ousting of the more-or-less wealthy farmers and escalated into Stalin’s massacres of those whose attempts at prosperity reflected an unacceptable bourgeois ideology.

“Collective farms” started rapidly emerging in the republic. The term implies a form of group management in the village, where production means (land, equipment, livestock, seeds, farms, etc.) were not the property of a separate peasant family, but were in communal possession and were managed by the members of the given community. Members of collective farms were not paid wages; rather, after their obligations to the state had been fulfilled, the leftover profit remained at the disposal of the collective farm. Every member of the given collective farm got a share of the profit in exchange for a share of the work.

Officially, collective farms were formed on a voluntary basis, and nobody could be forced to give up personal property in favor of a collective farm. However, in practice, things worked differently. By 1932, some 40 percent of Armenia's peasant households were collectivized, and it was not coincidence that the rise in collective farms coincided with the Stalinist repressions. Peasants joined collective farms with the sole goal of staying alive.

The forced collectivization and persecution led to mass disturbances in villages. A significant share of the collective farms that had been created in haste turned out to be unstable and fell apart shortly. Out of the 90,000 peasant households that had joined collective farms, only some 16,000 ultimately remained, and the collectivization process took a slower but a more stable course.

Concurrently, state agricultural enterprises were created in Armenia—the “sovkhoz” or “soviet farms.” These were not cooperative aggregations of peasants working for barter, but had wage workers who received a fixed salary.

In September 1940, Stalin signed a special government decree that revolutionized agriculture in Armenia.

According to this decree, a whole spectrum of tasks was set. For example, the construction of Hoktemberian’s canning factory with a capacity of 16 million cans of tinned food per year; construction of powerful cold storage plants with a capacity of simultaneous storage of 700 tons of fruit, juices and tinned fruit adjoined to the Yerevan canning factory, and many others.

Armenia’s swift development of agriculture in the 1960s-70s cannot be comprehended outside the effects of this decree. All the tasks listed in it—construction of factories, considerable expansion of vineyards and orchards, laying of railroads to the new factories, etc.—were not only implemented, but up until the collapse of the Soviet Union were the foundation of Armenia’s agro-industrial complex.

 Despite the fact that Soviet Armenia occupied only 0.13 percent of the total territory of the USSR and 0.23 percent of agricultural holdings were Armenian—Armenia’s share of production was incomparable with the land it occupied. At its peak production, Armenia provided nearly 25 percent of the tinned food produced in all of the USSR and 30 percent of the Swiss cheese. The tiny republic with less than a quarter percent of agriculture holdings produced almost four percent of the Union's grape harvest and two percent of fruit and vegetables.

The high indexes point to an intense development of agriculture—and this, too, at a time when Armenia was also being industrialized, and with a population that a generation earlier had been 70 percent rural, but was now 65 percent urban.

Soviet science contributed to the development of agriculture, creating centers in Armenia that were unique to the entire Union, where research was directed at development of the lands of the Ararat Valley.

Armenia’s agricultural boom would be short lived, as the Soviet-planned economy started seriously malfunctioning, led in its decline by growing militarization. Non-military-applicable research projects were practically ignored.

A rise in prices for farming machines, plunder on the part of dozens of service organizations, and a substantial gap between purchase and retail prices had lead to many collective and Soviet farms proving to be unprofitable. Attempts to solve agricultural problems by increasing the volumes of capital investments and intensively expanding “usable areas” did not yield the expected results.

All this became reasons why, by the early 1980s, Soviet agriculture had fallen into a state of crisis. The USSR had no way out other than drastically increasing imports of meat, oil, grains and sugar. In the mid-‘80s, the country was facing a new commodity famine that led to mass food deficit and hours-long “bread lines.” Under these conditions, profiteering and corruption thrived and theft of products at collective farms and sovkhozes became common.

Nonetheless, the main blow to Armenian agriculture was delivered in the late ‘80s and early ‘90s, when Azerbaijani SSR blocked all the railway exits from Armenia because of the armed conflict over Nagorno Karabakh. Armenia could no longer purvey its production to the other regions of the still-existing USSR. Consequently, the work of the numerous canning factories and other food-processing enterprises of the agro-industrial complex were suspended.

The subsequent collapse of the Soviet Union only aggravated the crash of the agriculture industry. In 1991-1992 the authorities of independent Armenia held land privatization and abolished collective and Soviet farms, leaving villagers alone with their pieces of land without means to work them (machines, fertilizers, seeds were now in the hands of a very small circle of confidants of the new authorities).

An industry that was destroyed in less than a decade shows little resemblance to its former self more than two decades later, and only after billions of dollars and countless projects and investment of brainpower from the United States to China, has “risen to its knees,” as one official put it.

Getting up

Too little may not be too late. Positive movement is taking place, aimed at bringing Armenian agriculture—and, thus, life for villagers—off its knees.

But to use the Biblical perspective relevant to this land as old as Noah: “The harvest is plenty, but the laborers are few.” And laborers are getting fewer, unless efforts mercifully now finally in place to reverse erosive trends can also re-cultivate an industry that has rare natural resource, but confounding un-natural impediments to its development.

Nearly 50 percent (some estimates are higher) of Armenia’s population—those engaged in some way in agriculture—is responsible for only about 17 percent of its Gross Domestic Product. According to the National Statistical Service of Armenia, the annual income per farm (and there are about 340,000 farms in Armenia) is about $4,700. At the same time, Armenia is among the top 10 countries in the world where by the end of 2010 the highest increase in food prices was registered, according to a study by the United Nations Food and Agriculture Organization.

For hundreds of thousands, farming’s meager average annual income can be more easily matched by spending eight or nine months working in Russia, where a paycheck is not always subject to rain or hail or drought or pests and where the hours are fewer, as are the worries about security.

Officials were rightly pleased to see agriculture improve by about 14 percent in 2011, over 2010. But in that same year, private remittances—largely from Armenian migrant workers in Russia—increased nearly 22 percent.

Percentages don’t favor change, but nationhood demands it.

The current government has recently reached out to farmers through programs that offer subsidized loans, discount fertilizer, and free seeds. By a government decision, loans were made available to the 225 poorest communities of the republic, at an annual interest rate of eight percent. Loans of 10 percent were offered to all other communities. The government subsidized six percent. Minister of Agriculture Sergo Karapetian said about 6,000 farms were issued a total of 4.2 billion drams (about $11 million) in loans.

But only about five percent of applicants qualify for the loans, and even farmers who are grateful, say it is not enough. They need machinery. But machinery is expensive. And even low-interest loans or sticker-price tractors are not within reach of an annual average income of $4,700. A $20,000 tractor represents five years’ total income. Loans are typically offered for a year’s term.

Villagers lobby for state-subsidized farm insurance, but Prime Minister Tigran Sarkisian says the country is not ready for it. “With the current level of revenues at farms, such a mechanism would only imply additional expenses for farmers,” he said in December, adding that the Ministry of Agriculture and the Central Bank of Armenia had held long discussions on the topic.

And the reply comes back: “If we can’t get insurance against crop failure, how can we take the risk of loans that depend on yield for income to pay them off?”

In that Catch-22 lies the disconnect between urban and village life that has yet to be closed; between present problems and proposed solutions; and between capital Yerevan and a third of the population. But attention is being paid.

That agriculture in the country needs a strong incentive was stated still during the days of Robert Kocharian’s presidency. Kocharian’s Minister of Foreign Affairs Vartan Oskanian even presented a program of agricultural development.

At the Armenia-Diaspora Forum in September 2006, Oskanian introduced the “Rural Poverty Eradication” program, in which it was proposed that wealthy Diaspora Armenians each take care of one Armenian village where people live in poverty.

A glossy 111-page book was published, in which it was stated that 50 Diaspora compatriots had undertook to help 50 of the 900 Armenian communities improve their economies and start development programs.

In 2007, the Hayastan All-Armenian Fund put the program for rural development on the agenda of its annual telethon. Six villages of the Tavush province—Aknakhbyur, Azatamut, Ditavan, Lusadzor, Lusahovit and Khashtarak—were selected as the first beneficiaries and preliminary infrastructure work was carried out.

After Oskanian resigned as foreign minister in 2008, the program was phased out.

Help does continue to come from abroad—Armenia’s most reliable resource for reform.

From 2006-2011, the United States government invested a total of $180 million in Armenia’s agriculture through its Millennium Challenge Account program. The program covered 750,000 farmers, or 75 percent of Armenia’s rural population. In addition to dramatic improvements in irrigation, one of the most important aspects of the program was the leasing of agricultural machinery.

Farm Credit Armenia, one of nine implementers for Millennium Challenge, has alone leased 50 tractors.

In 2011, the Board of Directors of the World Bank approved a project on the management of agricultural resources of Armenia, by which 55 villages in six provinces will be given a total of $16 million. As many as 80,000 farmers are expected to become beneficiaries of the project.

In rockslide fashion some 30 years ago, the living conditions of Armenian villagers crumbled and today remain fractured.

In language suitable to the subject, “seeds are being planted” for recovery. But whether a windowsill garden, or a sprawling valley farm industry, it is not the planting, but the tending, that makes a difference in agriculture . . .

Reporting provided by Aris Ghazinyan and Naira Hayrumyan

Originally published in the May 2012 ​issue of AGBU Magazine. Archived content may appear distorted on your screen. end character

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