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ARMENIAN MARKET CLOSES FOR ARMENIAN COMPANIES: EXPORTS PLUMMET
Lragir.am
Business - 10 February 2015, 22:40
Armenian businessmen avoid exporting goods to Russia because the
situation of this country's economy is uncertain. People relating to
this sector state that this January the levels of exports to Russia are
down compared with the previous years, levels of exports from Armenia
to Russia are down, though no official statistics is available yet.
There are several reasons for this which stem from the complicated
situation in the Russian economy. Gagik Makaryan, the head of the
Republican Union of Employers, highlights three problems. "Some
companies, considering the existing situation, have not resumed
exports, they are studying the setting, are cautious. Second, some
companies continue to export goods to Russia, suffering losses, not
to lose the market. Third, some employers have received new offers on
change of prices. Some canneries have to figure out if they can supply
goods to their Russian partners not to lose the market," Makaryan said.
He notes that some businessmen have frozen their contracts with Russian
partners, others are negotiating. The Russian side has requested
Armenian exporters to supply their goods at cheaper prices since
their profits are down.
At this stage the Armenian companies have to export goods to Russia
at higher prices because according to contracts with the Russian side
payment is made in rubles and the ruble has devaluated. Expensive goods
sell badly in the Russian market, sales drop, which automatically cuts
exports. Wine and brandy companies are facing serious problems. The
head of Agrarian and Farmer Association Hrach Berberyan told Lragir.am
they have suffered considerable losses. Some companies avoid speaking
about their problems at this stage.
MAP told Lragir.am that they have encountered problems with export
and sale of drinks in the Russian market. Sales and exports dropped
as prices soar. "Our goods are not competitive in the Russian market.
They want to pay us in rubles, they say they lose from paying in
dollars," MAP told us, adding that exports to Russia have been
dropping since September. Proshyan Brandy Factory's spokesman told
us the same thing.
Hrach Berberyan said according to the contracts the canneries
signed with the Russian side, payment is made after selling the
goods. The companies of the sphere suffered great losses after the
ruble devaluated.
"Reliance on the Russian market was not the right thing," he says. It
hits the economy of Armenia.
The head of Association of Exporters Raffi Mkhchyan told Lragir.am
that Armenian businessmen are in uncertainty. "The Russian side does
not want to pay in foreign currency, and the Armenian side does not
want to sustain losses. In this situation things are not moving in,
levels of exports plummeted. Some companies which used to export
till December have stopped exports since January. Instead, imports
from Russia have increased. At this stage businessmen are importing
flour from Russia to Armenia because the price of a bag of flour has
decreased by 4 dollars," Mkhchyan says.
Forecasts of immense exports to the Eurasian Economic Union by members
of Armenian government are not coming true. "Kazakhstan and Belarus
do not make a big change, neither have we discovered new markets or
reached new agreements there. We need to look at the state of the
Russian market," he said.
http://www.lragir.am/index/eng/0/economy/view/33615#sthash.Hp8S0gR0.dpuf
Lragir.am
Business - 10 February 2015, 22:40
Armenian businessmen avoid exporting goods to Russia because the
situation of this country's economy is uncertain. People relating to
this sector state that this January the levels of exports to Russia are
down compared with the previous years, levels of exports from Armenia
to Russia are down, though no official statistics is available yet.
There are several reasons for this which stem from the complicated
situation in the Russian economy. Gagik Makaryan, the head of the
Republican Union of Employers, highlights three problems. "Some
companies, considering the existing situation, have not resumed
exports, they are studying the setting, are cautious. Second, some
companies continue to export goods to Russia, suffering losses, not
to lose the market. Third, some employers have received new offers on
change of prices. Some canneries have to figure out if they can supply
goods to their Russian partners not to lose the market," Makaryan said.
He notes that some businessmen have frozen their contracts with Russian
partners, others are negotiating. The Russian side has requested
Armenian exporters to supply their goods at cheaper prices since
their profits are down.
At this stage the Armenian companies have to export goods to Russia
at higher prices because according to contracts with the Russian side
payment is made in rubles and the ruble has devaluated. Expensive goods
sell badly in the Russian market, sales drop, which automatically cuts
exports. Wine and brandy companies are facing serious problems. The
head of Agrarian and Farmer Association Hrach Berberyan told Lragir.am
they have suffered considerable losses. Some companies avoid speaking
about their problems at this stage.
MAP told Lragir.am that they have encountered problems with export
and sale of drinks in the Russian market. Sales and exports dropped
as prices soar. "Our goods are not competitive in the Russian market.
They want to pay us in rubles, they say they lose from paying in
dollars," MAP told us, adding that exports to Russia have been
dropping since September. Proshyan Brandy Factory's spokesman told
us the same thing.
Hrach Berberyan said according to the contracts the canneries
signed with the Russian side, payment is made after selling the
goods. The companies of the sphere suffered great losses after the
ruble devaluated.
"Reliance on the Russian market was not the right thing," he says. It
hits the economy of Armenia.
The head of Association of Exporters Raffi Mkhchyan told Lragir.am
that Armenian businessmen are in uncertainty. "The Russian side does
not want to pay in foreign currency, and the Armenian side does not
want to sustain losses. In this situation things are not moving in,
levels of exports plummeted. Some companies which used to export
till December have stopped exports since January. Instead, imports
from Russia have increased. At this stage businessmen are importing
flour from Russia to Armenia because the price of a bag of flour has
decreased by 4 dollars," Mkhchyan says.
Forecasts of immense exports to the Eurasian Economic Union by members
of Armenian government are not coming true. "Kazakhstan and Belarus
do not make a big change, neither have we discovered new markets or
reached new agreements there. We need to look at the state of the
Russian market," he said.
http://www.lragir.am/index/eng/0/economy/view/33615#sthash.Hp8S0gR0.dpuf