5.2. The Analysis of the RA Environmental and Economic Development Options in View of Sustainable Human Development

The relationships between socioeconomic and environmental situations in different countries could be graphically represented as a process of oscillation, which corresponds to the so-called socio-environmental pendulum (Figure 5.2). If economic development unfolds without regard for environmental priorities, then an environmental crisis breaks out in the country, whereas an unjustified prevalence of environmental priorities over socioeconomic ones destroys the economy and leads to poverty. Hence, the system is forced to avoid radical extremes since it is "hit" by the priorities neglected in the course of development. As a result, it either oscillates like a pendulum or else chooses the optimal option and moves along in compliance with the balanced, i.e. sustainable human development criteria.

Examination of Armenia's development over the last decade reveals that it is locked in such an oscillating cycle that is aggravated by a comprehensive crisis and that transition to sustainable human development has not been accomplished yet.

Figure 5.2. Schematic representation of socio-environmental pendulum and of the optimal option of sustainable development. (The "strokes" by neglected priorities are represented by arrows).

This process can be represented in a more detailed fashion in Figure 5.3, which displays the relationship between the countries' quality of life (in fact its indicators coincide with the indicators of SHD) and incomes. Segment AS on the curve corresponds to a sustainable, albeit not industrial lifestyle (simple agriculture, crafts, etc.), where consistent reproduction and a sustainable use of resources are ensured, even when incomes and the level of socioeconomic development are not high.

Sustainable development of industrial countries is ensured within the limits of segment SD, whereas beyond point D the over-consumption of resources occurs, leading eventually to deterioration of the quality of life. Developed countries solve this problem by establishing transnational corporations, using resources of the entire planet and ensuring GNP growth (segment DE). For segment AD, each of the points on the curve is correlated to 2 options: either a country goes up following the sustainable development track or, as a result of over-exploitation, it "comes off" and goes down in a "free fall" trajectory.

Armenia's development over the last decade can be outlined on the "sustainability curve" as a MLNR trajectory. In the initial period the development probably followed a course of sustainability, but at the pre-industrial or under-industrialized production levels (segment MS). Then the socioeconomic system gets industrialized rapidly and "comes off" the sustainability curve because of the neglect of environmental priorities. The quality of life deteriorated (segment SLN) because of the decline in the environmental situation, despite growing incomes. As a result of the geopolitical and socioeconomic events of the last decade, the system has moved quickly on a course of degradation (segment NR) and ended up at (conventional) point R characterized by low values of economic, social and environmental indices.

Given the point of departure, the following options are possible:

Negative scenario:

Option I: Country's economy is not restored and societal regress still goes on. The major priorities are the struggle against poverty and the provision of food. Taking into consideration the growing foreign debt and the upcoming full servicing of that debt, the continual regress of the system is not impossible (direction RK).

Option II: The economy has been restored; however, the production operates without regard for environmental priorities. That leads to environmental degradation (RFT segment). At first GDP increases; however, again the economy goes through regress because of the unfolding environmental crisis. Already today the prerequisites, exemplified by the calamitous situation of Lake Sevan and of its basin, the continuing reduction of woodlands, degradation of alpine and sub-alpine areas, etc. are clearly outlined, threatening to turn Armenia into an environmental disaster zone.

Figure 5.3. The RA development trajectory in the context of the global comprehensive system of the development of civilization (the scale is conventional). The "sustainability curve" reflects the dependency of the quality of life (a set that corresponds to the SHD indicators is assumed) on the population's incomes.

Positive scenario:

The positive scenario is feasible only if it is built upon the SHD foundation. To that end, it is necessary to create a high-ranking National Council (Committee or Commission) for the Sustainable Human Development, which would elaborate a national conceptual framework and strategy for SHD.

In Armenia research on various aspects of Sustainable Development has been conducted and a number of plans and programs (the National Environmental Action Plan, etc.) have been designed. The latter, harmonized with short- and long-term plans of socioeconomic development, and the scheme of human settlements can serve as a foundation for the elaboration of a national conceptual framework on SHD.

We would like to outline two approaches toward the SHD re-direction.

A. The "traditional" approach is based on the principle of "business as usual", with the only difference in making economic activities environmentally friendly and highly efficient. To progress along those lines, at least the following are necessary:

1. To focus, while setting priorities for the national economy, on resource- and energy-saving, low-waste high technologies, on the development of alternative energy, on maximum recycling of production and of consumption waste as well as on dissemination of the existing experience of bio-dynamic agriculture throughout the entire country.

2. To assess currently active legislation in light of SHD, to establish the adequate legal climate and stimulating financial and economic mechanisms. The existing principle of "the polluter pays" should be supplemented with tax privileges granted for waste-utilizing production and for other environmentally-oriented initiatives and with long-term loans for those who introduce environmental protection equipment and environmentally safe and appropriate technologies.

3. To establish national and local ecofunds for the implementation of relevant projects and programs.

If such an approach is taken, the country will be in a position finally to orient itself towards sustainable development (route RMB or RB on Figure 5.3) but it will not be able to exceed the conventional point B since progress will be constrained by the capability of ecosystems. Nevertheless, this approach is necessary and should be implemented.

B. Another, "holistic" approach may prove more efficient. It targets the elaboration of the optimal SHD model for the country on the basis of the current situation and of the existing potential and ways for its implementation. It does not rule out but, on the contrary, complements the above approach and provides an opportunity for a breakthrough using as well non-traditional ways.

For Armenia this is, first of all, the development of the non-material sector of the economy as w ell as the use of the country's specific features, among them:

1. Use of the potential for research and technological advances

In the aftermath of the collapse of the USSR, Armenia was confronted with the challenge of preserving an impressive research and technological potential. The approach prevalent until recently, which contended that it is impossible to preserve and, moreover, to develop science in a small country like Armenia, especially under the conditions of economic crisis, brought about the exodus of scientists and scholars and the depletion of the research potential. But it is that very potential which can lay the foundation for the anticipated breakthrough, "fuelling" the progress through "traditional" ways as well as becoming one of the principal income-generating branches of the economy.

The latter may materialize if inventions and efficiently designed models, other research and technological breakthroughs achieved in Armenia are commercialized and exposed to the international market.

Armenia's very strong scientific base developed during the Soviet era, plus the experience of ARMPATENT, together with the resources of RA National Academy of Sciences, higher educational and research institutions all lend support to the argument for this approach.

Some research teams have already succeeded in getting by themselves onto the world market for intellectual property. Should adequate State sponsorship for the research become available, intellectual commodities could become an essential source of national revenue.

2. Development of comprehensive tourism

Armenia has a rich past experience in the sphere of traditional tourism (historical and cultural sites), which is now being revitalized. Simultaneously, the current international trends in the tourism industry could open new opportunities for the Republic of Armenia, which could be realized through the development of ecological tourism given the country's rich bio-diversity and numerous natural wonders.

Armenia's significant mineral and balneological potential (at present underused) can also contribute to the development of comprehensive tourism (e.g. medical rehabilitation for tourists at spas such as Jermuk, Arzni, etc.).

3. Sustainable use of agrobiodiversity entails the preservation of wild life and of its sustainable use in situ as well as its growth ex situ (e.g. on plantations, etc.). The environmentally and economically efficient use of Armenia's unique agro-biodiversity (including the collections of cultivated species) could become an additional source of income.

These measures together with the traditional approach can ensure Armenia's transition to SHD at a higher qualitative level (that route has been designated on Figure 5.3 as a RC trajectory).

The process of shifting towards the SHD is a lengthy one and should be broken down in all sectors into stages with short-, medium- and long-term goals. The goals for the first period should be to arrest further regression, to stabilize the situation in all spheres of societal life and then to rehabilitate the most unbalanced spheres and territories. This should be accomplished in light of re-orienting legal, educational and social-psychological fields towards the SHD and by securing them with a highly qualified scientific research.