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  • Can Armenia expand presence on Russian markets?

    Vestnik Kavkaza, Russia
    Sept 3 2014

    Can Armenia expand presence on Russian markets?

    3 September 2014 - 2:02pm
    By Susanna Petrosyan, Yerevan. Exclusively for Vestnik Kavkaza


    Russia has opened the doors of its huge market to countries that were
    not involved in exchange of sanctions between the West and Russia. The
    countries, one of which is Armenia, have found new opportunities and
    favourable conditions to make use of new commercial advantages and
    stimulate exports.

    A large group of entrepreneurs has taken part in recent talks in
    Yerevan about organizing exports in the context of the new conditions.
    Prime Minister Ovik Abramyan said that the government was ready to
    provide all the necessary financial and organizing assistance to
    businessmen willing to export products to Russia. Agriculture Minister
    Sergo Karapetyan assured that Armenia could double exports to Russia:
    "In various years since Soviet times, we have been exporting up to
    70-75% of our fruit and vegetable products to Russia."

    Proper and timely use of opportunities will have a positive impact on
    both the economy and the social sector of Armenia. The multi-faceted
    nature of the commercial sector includes such important parameters as
    correlation of exports and imports, the state of production and
    financial potential, the level of investments, etc. In this aspect, it
    is worth analyzing the readiness of Armenia for the new opportunities.

    In the last two years, the level of investment in the country's
    economy has basically turned into foreign injections. One of the
    reasons for that is imitation of reforms. The IMF has pointed out the
    need for reforms. Another essential problem hindering an appropriate
    and timely reaction to the new situation is imports exceeding exports
    by about $3 billion. The great transcendence of imports over exports
    is one of the key problems of the Armenian economy.

    Samson Avetyan, an economist and founder of the Arrow Global
    investment company, believes that the governmental debt of Armenia and
    emigration have increased because the country imported more than it
    exported in the past few years. "Armenia, in terms of exports, has no
    diversity and, in this case, it cannot develop the agricultural sector
    and the IT sector alone. If we want to export to Russia, we will need
    big volumes. Quaere, do we have such volumes?" says Avetyan.

    Gagik Makaryan, the head of the Union of Employers of Armenia,
    supposes that processing factories are operating at a load of 50% or
    25%. Some economists are confident that Armenia may boost production
    of agricultural products but it needs infrastructure for processing,
    storage and logistics. The volumes of canned food, juice and wine
    produced in Azerbaijan can be tripled; consequently, Armenia will
    become a major exporting state. However, other economists consider
    such optimism hasty and unjustified. "Russia's ban on imports of
    European goods does not mean that Armenia has such amazing
    opportunities to flood the Russian market with its products.
    Approaches toward the issue could be more serious and realistic. We
    should have thought about the problem of assisting national
    manufacturers earlier, including in exports, instead of waiting for a
    lucky chance, in other words, the response to sanctions by Russia
    against the West, to use it," speculates economist Vardan Bostanjian.

    Armenia will probably make use of the benefits offered, although the
    country was unprepared for the sudden favourable conditions.

    http://vestnikkavkaza.net/articles/economy/59580.html


    From: Baghdasarian
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