Eurasian realities look promising, Armenia on the right way: expert

Armenia’s economy saw upward trend in 2017 and in the first quarter of 2018. Aram Safaryan, head of Integration and Development NGO, Coordinator of Armenian Expert Club, said talking to EADaily.

Economy of Russia is on the way of sustainable growth which has a positive impact on economies of Eurasian space and a significant growth of almost all indicators. “We can see growth of export and import, industry and construction. Even such heavy sectors as agriculture and energy have increased as compared to last year. This will continue in second quarter of 2018 as well. It is very important for us to see a tendency towards two-digit growth in the key sectors of Armenian economy (including export of finished products), due to developing trade and economic ties with Russia, first of all,” Safaryan said.

Russia accounts for one-fourth of total export from Armenia – an absolute leader. Economic partners of Armenia after Russia are Switzerland, Bulgaria, Germany, Iraq, UAE, Netherlands, China, Iran and U.S. Altogether it is 75% of Armenia’s export. However, part of these countries may not be in that list as early as in second quarter of 2018. Hence, speaking of a significant growth of cooperation to boost Armenian export, one should focus on Russia, first.

“Russian economy is of high importance for Armenia. Its role and factor in Armenia’s economy has a tendency of sustainable growth, which creates big expectations of economic improvements and higher living standards for the Armenian public. Money remittances from Russia to Armenia have increased as well – Russia is still the key source of money remittances to Armenia and one of the key partner-countries, where money is transferred from Armenia. This means that we are involved in private investments in Russian economy, which is an evident development of integration processes inside EAEU,” Safaryan said adding that in 2017, Armenia received monetary transfers for $1 billion 70 million, 60% of which – from Russia.

At the same time, members of Eurasian expert club refrain from forecasts for entire 2018, since economic processes develop in a contradictory manner, especially for such sensitive states as Armenia. However, there are some forecasts for a six-month period. For instance, Safaryan anticipates a growth in agricultural sector, processing, textile and footwear industry.

Safaryan recalled World Bank’s forecast of 3.8% economic growth in Armenia in 2018, whereas government of Armenia envisages 4.5% growth.

“However, we believe that if government sets an ambitious goal to double GDP of Armenia within ten years to lead the country from the group of third countries to the group of developing ones, that ambitious task can be settlement by combined efforts of the Armenian public, business and government. The recent developments in Armenia speak of potential return of money that vanished abroad, anti-corruption measures, elimination of monopolies, embezzlement of budgetary and private funds. These positive trends cannot but have a positive impact on overall economic climate in the country. We believe that if the new government announces capital amnesty for the money legally or illegally taken abroad during the last 20 years (I am speaking about more than $20 billion in offshore banks) and at least part of those funds is returned and invested in Armenia’s economy, it will improve the situation dramatically,” the expert said.

Safaryan recalled World Bank’s report that anticipates no large investments from big countries. However, he said, political changes in Armenia and improvement of business environment, protection of businesses and private property, new opportunities for small and mid-sized businesses announced by Nikol Pashinyan’s government should attract more investors from Russia and EAEU, first of all.

Safaryan pointed at an interesting fact – the list of Armenia’s top ten partners does not comprise EAEU members Kazakhstan, Belarus and Kyrgyzstan. However, he is sure that there are good opportunities for the Armenian government to boost cooperation with governments of friendly countries in the Eurasian Economic Union. Eurasian realities look promising, due to growth of economies within this integration space.

By Lia Khojoyan