The Government of the Republic of Armenia

Prime Minister Karen Karapetyan called at the Ministry of Economic Development and Investment to discuss development prospects for various sectors of the economy, economic performance, investments, improvement of the business environment, planned activities and other issues of topical interest.

The Head of Government was informed that the economic indicators were quite encouraging in the first quarter of 2017, with the economic activity index standing at 6.6 percent, industrial production - 16.1%, exports - 16.5%, inbound tourism - 18.2 percent, etc. Exports were said to be the main driving force behind economic growth with strong growth potential in terms of ore concentrates and metals, beverages, tobacco and diamond jewelry, light industry and pharmaceuticals. The goal is to achieve a positive trade balance over the next five years

The Ministry executives believe it to be quite realistic to achieve a USD 200 million increase in exports in 2017, followed by a USD 450 million growth in 2018. Note that logistics companies, too, have been active on the market recently. Their number reached 4. At the same time, it was stressed that Armenia’s main export outlets are the EEU-member countries, followed by EU-member States, the UAE, Iran, Turkmenistan, China and so on. In particular, exports toward the Eurasian Economic Union and the European Union are expected to increase by USD 400 million USD 100 million respectively.

“You are welcome to state that exports will overwhelm imports by 2022. But do you realize where we can step up exports and reduce imports?” the Prime Minister asked and received a positive response. It was noted that the annual growth of exports should be not less than 20%. 15 thousand new jobs are expected to be created in 2017-2018, mostly in light industry.

“Our main goal is to make the citizens of Armenia satisfied with their freedoms, security and safety, social and living conditions. That calls for new jobs, better laws and so on. Jobs are driven by exports, but when talking about jobs, we need to understand the expected volumes; we must realize what impact exports and import substitution may have on the economy,” Karen Karapetyan said.

The Prime Minister was told that there are clear forecasts and relevant deadlines as regards light industry in terms of new businesses and investments. Exports are expected USD 56 million up in 2018, while only 12 million dollars of exports was expected in 2016. Armenia was said well poised for rapid development of light industry. At the same time, the speakers noted that the need for the use of special modes for working capital, and the return of VAT paid on the border has been voiced repeatedly with the rise in the number of exports and exporters.

In response, the Prime Minister stated as follows, “We are ready for it, we do not want to avoid the problem; we want to do so, and will come to it through the State Revenue Committee reform. I am sure that we will succeed.”

Then the meeting discussed the programs and efforts aimed at improving the business environment. It was noted that Armenia ranked 38th among the 190 countries included in the World Bank’s Doing Business report for the year 2017 (Doing Business 2017). Armenia is the third best country among the CIS nations and the 2nd best in the region. 43 activities are planned in the 2017 program, 16 of which may have a direct impact on the estimated indicators.

The Premier wanted to know how many prospective investors had already turned to the Ministry with various requests. In response, it was reported that 224 potential investors had applied to the Ministry since the beginning of this year. One investor in five has submitted a logical proposal and was given favorable consideration. The Prime Minister was also briefed on the work done to substitute imports. Different agencies are now assessing the possibilities and the scope for further action.