Economy of Armenia

At the beginning of the 20th century, the territory of present-day Armenia was an agricultural region with some copper mining and cognac production. From 1915 through 1921, Armenians in the region suffered from a genocide carried out by the Ottoman Empire, during which about 1.5 million Armenians were killed. This caused total property and financial collapse when all of their assets and belongings were forcibly taken away by the Turks, the consequences of which have still left their mark over a century later. Prior to the genocide, Armenians had been one of the most affluent ethnic groups within the Ottoman Empire, largely due to their involvement in highly productive sectors such as banking, architecture, and trade. However, after the genocide and the subsequent confiscation and pillaging of Armenian property, the people and the country were left in ruins. Contending with revolution, the influx of refugees from Western Armenia, disease, and starvation, Armenians went from relative wealth and prosperity to suffering from poverty and famine. This period of intense state control ended in 1921, with the implementation of Soviet leader Vladimir Lenin's New Economic Policy (NEP). This policy continued state control of larger enterprises and banks, but allowed for private ownership of small and medium-sized businesses. In Armenia, the NEP brought partial recovery from the economic disaster brought by the aftermath of the genocide. By 1926, agricultural production in Armenia had reached nearly three-quarters of its prewar level. In 1991, Armenia's last year as a Soviet republic, national income fell 12% from the previous year, while per capita gross national product was 4,920 rubles, only 68% of the Soviet average. In large part due to the earthquake of 1988, the Azerbaijani blockade that began in 1989 and the collapse of the international trading system of the Soviet Union, the Armenian economy of the early 1990s remained far below its 1980 production levels. In the first years of independence (1992–93), inflation was extremely high, productivity and national income dropped dramatically, and the national budget ran large deficits. A period of chronic shortages, was the first stage of price deregulation, which allowed goods to stay in Armenia as opposed to being exported for better prices; the inflation rates were 10 percent in 1990, 100 percent in 1991, and 642.5 percent during the first four months of 1992, compared with the first four months of 1991. Thus, there were two opposing dynamics: price increases in response to shortages and falling incomes due to the recession and unemployment. Although a cease-fire has held since 1994, the conflict with Azerbaijan over Nagorno-Karabakh has not been resolved. The consequent blockade along both the Azerbaijani and Turkish borders has devastated the economy, because of Armenia's dependence on outside supplies of energy and most raw materials. Land routes through Azerbaijan and Turkey are closed; routes through Georgia and Iran are adequate and reliable. In 1992–93, the GDP had fallen nearly 60% from its 1989 level. The national currency, the dram, suffered hyperinflation for the first few years after its introduction in 1993. Armenia has registered strong economic growth since 1995 and inflation has been negligible for the past several years. New sectors, such as precious stone processing and jewelry making and communication technology (primarily Armentel, which is left from the USSR era and is owned by external investors). This steady economic progress has earned Armenia increasing support from international institutions. The International Monetary Fund (IMF), World Bank, EBRD, as well as other international financial institutions (IFIs) and foreign countries are extending considerable grants and loans. Total loans extended to Armenia since 1993 exceed $800 million. These loans are targeted at reducing the budget deficit, stabilizing the local currency; developing private businesses; energy; the agriculture, food processing, transportation, and health and education sectors; and ongoing rehabilitation work in the earthquake zone. The country's electricity distribution system was privatized in 2002. In the first half of 2020, the Armenian economy was negatively impacted by the economic restrictions that were implemented in response to the COVID-19 pandemic. These restrictions included a stay-at-home order, an indoor social distancing requirement, and a mask mandate. These restrictions had a negative impact on businesses; according to the World Bank, individual consumption dropped by 9% in the first six months of 2020 due to the stay-at-home order. The economy was further impacted by the war against Azerbaijan later in the year. == Data ==

The following table shows the main economic indicators in 1992–2021 (with IMF staff estimates in 2022–2026). Inflation below 5% is in green. == Regional economies ==

This is a list of provinces of Armenia by nominal GDP shown in Armenian dram and US$. Statistics shown are for 2023 ==Sectors==

Agriculture , figs, pears, peaches and apples sold at a market in Yerevan are among a few of Armenian agricultural products. Although agriculture used to make up a larger share of Armenia's economy, this share has been declining and sits at 7.9% of Armenia's GDP. Roughly 16% of Armenia's land is arable, with most of the richest farmland concentrated near the Aras River valley and in the valleys north of Yerevan. The agriculture sector currently has a near equal distribution of crops and livestock, with the former accounting for 47.5% of the industry, and the latter accounting for 52.5%. In recent years, the sector's growth has been constrained by small, fragmented landholdings, soil degradation, limited arable land, and challenges in the livestock industry, including disease management and low productivity. However, the industry has remained competitive in key agricultural products, such as figs, pomegranates, olives, peaches, walnuts, quince, and apricots (Armenia is the world's 9th largest producer). Processed foods and alcoholic beverages—particularly brandy and an increasingly dynamic wine sector—dominate agricultural exports. and its wine industry has expanded rapidly due to investment, improved vineyard management, and growing international interest in indigenous grape varieties. The mining industry employs around 10,000 people and offers a nominal monthly salary of $710. In recent years, mining has accounted for less than 5% of Armenia's GDP, but products derived from mining make up a majority of Armenia's exports. The largest contributors to this sector are Armenia's gold, copper, and molybdenum mines, and Armenia is responsible for 1.9% of global molybdenum output. There are also smaller deposits of lead, silver, and zinc, as well as deposits of industrial minerals and products, including cement, diatomite, gypsum, and limestone. In 2017, construction output increased by 2.2% reaching 416 billion AMD. Armenia experienced a construction boom during the latter part of the 2000s. According to the National Statistical Service, Armenia's booming construction sector generated about 20 percent of Armenia's GDP during the first eight months of 2007. According to a World Bank official, 30 percent of Armenia's economy in 2009 came from the construction sector. This decrease comes despite the fact that an important component of the government stimulus package was to support the completion of ongoing construction projects. As of February 2019 nearly 23 thousand employees were counted in ICT sector. With 404 thousand AMD they enjoyed highest pay rate among surveyed sectors of economy. Average salaries in pure IT sector (excluding communications sub-sector) stood at 582 thousand AMD. Manufacturing In 2017, industrial output increased by 12.6% annually reaching 1661 billion AMD. Industrial output was relatively positive throughout 2010, with year-on-year average growth of 10.9 percent in the period January to September 2010, due largely to the mining sector where higher global demand for commodities led to higher prices. Services In the 2000s, along with the construction sector, the service sector was the driving force behind Armenia's high economic growth rate. Banking headquarters in YerevanIn 2019, there were 20.5 thousand employees registered in the financial sector and Armenian banks' lending grew at an annualized rate of 10 percent. The establishment of Microfinance institutions in Armenia was dependent on them making a complementary effort to fill the gap in the financial services sector. Its primary goal was to deal with the rising unemployment and poverty brought on by transitory shock. In this context, self-employment in the country emerged as one of the best options to unemployment. Commercial banking institutions in Armenia overlooked micro-business enterprises that lacked credit histories and sufficient funding. Microfinance has been proposed as an adaptable instrument to assist people in transition economies take advantage of new opportunities. Tourism , established in 1926 Tourism in Armenia has been a key sector to the Armenian economy since the 1990s, when tourist numbers exceeded half a million people visiting the country every year (mostly ethnic Armenians from the Diaspora). The Armenian Ministry of Economy reports that most international tourists come from Russia, EU states, the United States and Iran. Though relatively small in size, Armenia has three UNESCO world heritage sites. Despite internal and external problems, the number of incoming tourists has been continually increasing. 2018 saw a record high of over 1.6 million inbound tourists. In 2018 receipts from international tourism amounted to $1.2 billion, nearly twice the value for 2010. In per capita terms these stood at $413, ahead of Turkey and Azerbaijan, but behind Georgia. In 2019 the largest growth at 27.2% was shown by accommodation and catering sector, which came as a result of the growth of tourist flows. ==Financial system==

Currency The official currency of Armenia is the dram. It was adopted in 1993 and has maintained a relatively stable exchange rate with the US dollar, with one USD fluctuating between roughly 300-600 drams for the past few decades. One of the Central Bank of Armenia's core monetary policy missions is to keep inflation under control, with an annual target of 3%. National Statistics Office publishes official reference exchange rates for each year. In 2019, the Armenian government planned to obtain about $490 million in fresh loans rising public debt to about $7.5 billion. Just over $6.9 billion of that would be the government's debt. After reaching nearly 60.0 per cent of GDP, the public debt to GDP ratio decreased by approximately three percentage points in 2018 compared with a year before and stood at 55.7 per cent at the end of 2018. The government's public debt at the end of 2019 stood at $6.94 billion, making 50.3% of its GDP. In March 2019 sovereign debt was $5488 million, $86.5 million (about 2%) less than a year ago. Other sources quote Armenia's debt at $10.8 billion in September 2018, possibly including non-public debt too. In 2018 debt-to-GDP ratio stood at 55.7% down from 58.7% in 2017. Armenia revised the country's fiscal rules in 2018, setting a permissible threshold for public debt in the amount of 40, 50 and 60% of GDP. At the same time, it established that in case of force majeure situations such as natural disasters, wars, the government will be allowed to exceed this threshold. The debt rose by $863.5 million in 2016 and by another $832.5 million in 2017. It totalled just $1.9 billion (13.5% of GDP) before the 2008 financial crisis and the Great Recession. Net private transfers decreased in 2009, but saw a continuous increase during the first six months of 2010. Since private transfers from the Diaspora tend to be mostly injected into consumption of imports and not in high value-added sectors, the transfers have not resulted in sizeable increases in productivity. However, the latter figures only represent cash remittances processed through Armenian commercial banks. According to RFE/RL, comparable sums are believed to be transferred through non-bank systems, implying that cash remittances make up approximately 30 percent of Armenia's GDP in the first half of 2008. ==Government==

Government revenues In August 2019 Moody's Investors Service upgraded Armenia to Ba3 rating with stable outlook. According to the National Statistical Service, Armenia's government debt stood at AMD 3.1 trillion (about $6,4 billion, including $5,1 billion of external debt) as of 30 November 2017. Armenia's debt-to-GDP ratio will drop by 1% in 2018 according to finance minister. In Armenia's external debt ($5.5 billion as of 1 January 2018), the arrears for multi-country credit programs dominate – 66.2% or $3.6 billion, followed by debt on bilateral loan programs - 17.5% or $958.9 million and investments of non-residents in Armenian Eurobonds – 15,4% or $844.9 million. For the whole Armenian economy and international commerce, 2020 was a year of decline. In a variety of areas Armenian commodities are being exported and imported at a lower rate. According to the Armenian Statistical Committee, Armenia exported goods worth $2.544 billion in 2020, a fall of 3.9 percent from 2019. Armenia imported items worth 4.559 billion dollars in 2020, down 17.7% from the previous year. The volume of Armenia's international trade has varied throughout the previous 10 years. Taxation Employee income tax Since 1 January 2023, Armenia has had a flat income tax, which taxes wages at 20%, regardless of the amount. Corporate income tax The reform adopted in June 2019 aims to boost medium-term economic activity and to increase tax compliance. Among other measures, the corporate income tax was reduced by two percentage points to 18.0 per cent and the tax on dividends for non-resident organisations halved to 5.0 per cent. This suggests that tax collection in Armenia is improving at the expense of ordinary citizens, rather than wealthy citizens (who have been the main beneficiaries of Armenia's double-digit economic growth in recent years). ==External trade and investment==

Foreign trade Exports According to the National Statistical Committee, in 2018, exports amounted to $2.411.9 billion, having grown by 7.8% from the previous year. After a boom of almost 93% in 2022, the IMF expects exports of goods and services to grow by 22% in 2023 and 8% in 2024. The goods export structure changed considerably in 2018 as the export of the traditional mining sector decreased while the share of textiles, agriculture and precious metals increased. Geographical location of the country and relatively low electricity costs are comparative advantages supporting to boost the production of the textile and leather products in Armenia. Proximity to Europe in comparison with manufacturers in East Asia creates opportunity to strengthen Armenia's position as contract manufacturing destination for European brands. Foreign companies that put orders to Armenian companies are mainly famous European brands, particularly, from Italy (La Perla, SARTIS, VERSACE etc.) and Germany (LEBEK International Fashion, KUBLER Bekleidungswerk). With the Armenia's entry into Eurasian Economic Commission, the opportunity to increase its presence with textile and leather production raised also in the countries of Eurasian Economic Commission as no customs duty applies to Armenian products in the export markets within the customs union. According to the study "Regional and International Trade of Armenia", authors investigated the trade potential of Armenia for different product groups by employing a gravity model of trade approach. The study explored Armenia's trade flows to 139 countries for the period of 2003 to 2007. According to the results of the paper, the authors concluded that "Armenia has exceeded its export potential almost with all the CIS countries". In addition, the authors concluded that the most perspective product groups of Armenian export tend to be "Industrial products", "Food and beverages" and "Consumer goods". According to most recent (2019 Jan-Feb compared to 2018 Jan-Feb) ArmStat calculations, biggest growth in export quantities was measured towards Turkmenistan by 23.6 times (from $37K to $912K), Estonia by 15 times (from $8.4K to $136.5K) and Canada by 11.5 times (from $623K to $7.8 mln). Meanwhile, exports to Russia, Germany, USA and UAE dropped. Imports In 2017 Armenia imported $3.96B, making it the 133rd largest importer in the world. During the last five years the imports of Armenia have decreased at an annualized rate of -1.2%, from $3.82B in 2012 to $3.96B in 2017. The most recent imports are led by Petroleum Gas which represent 8.21% of the total imports of Armenia, followed by Refined Petroleum, which account for 5.46%. Armenia's main imports are oil, natural gas, cereals, rubber manufactures, cork and wood, and electrical machinery. Armenia's main imports partners are Russia, China, Ukraine, Iran, Germany, Italy, Turkey, France and Japan. The European Union (28.7% of total exports), Russia (26.9%), Switzerland (14.1%), and Iraq (14.1%) are Armenia's largest export partners (6.3 percent). The Russian Federation is the most important import partner (26.2%), followed by the EU (22.6%), China (13.8%), and Iran (13.8%). (5.6 percent). After the 2008 Russian-Georgian conflict, which briefly halted the nation's hydrocarbon supply and exposed the country's energy vulnerabilities, the country has been looking for other energy sources. Tensions with its neighbors, notably Azerbaijan and Turkey, continue to exist, affecting commerce. Armenia's ties to Russia, as well as its membership in the Eurasian Economic Union, constrain the country's potential to integrate further with the EU. Imports in 2017 amounted to $4.183 billion, up 27.8% from 2016. The global economic crisis has had less impact on imports because the sector is more diversified than exports. In the first nine months of 2010, imports grew about 19 percent, just about equal to the decline of the same sector in 2009. The current account deficit represented 2.4 percent of GDP in 2017 and increased up to 8.1 percent of GDP during the first three quarters of 2018. This was a result of about 8 percent increase in goods export and 21 percent increase on goods import in nominal terms year on year in 2018. Partners European Union In 2022 Armenia's bilateral trade with the EU topped $2.3 billion, making the EU one of Armenia's biggest and most important economic partners. EU-Armenia trade increased by 15% in 2018 reaching a total value of €1.1 billion. In 2017 EU countries accounted for 24.3 percent of Armenia's foreign trade. Whereby exports to EU countries grew by 32,2% to $633 million. In 2010 EU countries accounted for 32.1 percent of Armenia's foreign trade. During the first 11 months of 2006, the European Union remained Armenia's largest trading partner, accounting for 34.4 percent of its $2.85 billion commercial exchange during the 11-month period. Russia and former Soviet republics On 14 October 2024, Armenia notified its ratification of the Commonwealth of Independent States Agreement on Free Trade in Services, Establishment, Operations and Investment, which entered into force on 13 November 2024 for Armenia. In the first quarter of 2019, share of Russia in foreign trade turnover fell to 11% from 29% from the previous year. In 2017, CIS countries accounted for 30 percent of Armenia's foreign trade. The volume of Chinese-Armenian trade soared by 55 percent to $390 million in January–November 2010. Armenian exports to China, though still modest in absolute terms, nearly doubled in that period. The number of Iranian tourists has risen in recent years, with an estimated 80,000 Iranian tourists in 2010. Turkey In 2019 the volume of bilateral trade with Turkey was about $255 million, with trade taking place across Georgian territory. This figure is not expected to increase significantly so long as the land border between the Armenia and Turkey remains closed. Between 40%-53% of all foreign direct investments in Armenia between 1988 and 2022 originate from Russia. Foreign direct investment (FDI) into Armenia decreased by US$2.7 million in December 2020, compared to a reduction of US$10.3 million the previous quarter. Armenia foreign direct investment: USD mn Net Flows data is available from March 1993 through December 2020, and is updated quarterly. The statistics ranged from a high of US$425.9 million in December 2008 to a low of –67.6 USD mn in December 2014. Armenia's current account surplus is US$51.7 million in December 2020, according to the most recent statistics. -In June 2021, Armenian Direct Investment Abroad increased by 12.8 million dollars. -In June 2021, it boosted its Foreign Portfolio Investment by $14.6 million. -In December 2020 the country's nominal GDP was reported to be 3.8 billion dollars. Yearly FDI figures Despite robust economic growth foreign direct investment (FDI) in Armenia remain low as of 2018. in January–September 2019 the net flow of direct foreign investment in the real sector of the Armenian economy stood at about $267 million. Jersey was the main source of FDI in 2017. Moreover, combined net FDI from all other sources was negative, indicating capital outflow. By the end of 2017 stock net FDI (for the period 1988–2017) reached 1824 billion AMD, while gross flow of FDI for the same period reached 3869 billion AMD. FDI in founding capital of financial institutions During the sector consolidation process in 2014–2017 the share of foreign capital in the authorized capital of the Armenian commercial banks decreased from 74,6% to 61,8%. Net FDI in founding capital of financial institutions accumulated by end of September 2017 is presented in pie chart below. Foreign aid United States The Armenian government receives foreign aid from the government of the United States through the United States Agency for International Development and the Millennium Challenge Corporation. On 27 March 2006, the Millennium Challenge Corporation signed a five-year, $235.65 million compact with the Government of Armenia. The single stated goal of the "Armenian Compact" is "the reduction of rural poverty through a sustainable increase in the economic performance of the agricultural sector." The compact includes a $67 million to rehabilitate up to 943 kilometers of rural roads, more than a third of Armenia's proposed "Lifeline road network". The Compact also includes a $146 million project to increase the productivity of approximately 250,000 farm households through improved water supply, higher yields, higher-value crops, and a more competitive agricultural sector. In 2010 the volume of US assistance to Armenia remained near 2009 levels; however, longer-term decline continued. The original Millennium Challenge Account commitment for $235 million had been reduced to about $175 million due to Armenia's poor governance record. Thus, the MCC would not complete road construction. Instead, the irrigated agriculture project was headed for completion with apparently no prospects for extension beyond 2011. European Union According to the agreement signed in 2020 EU will provide Armenia with 65 million euros for implementation of three programs in such areas as energy efficiency, environment and community development and formation of tools for implementation of the Comprehensive and Enhanced Partnership Agreement. With curtailment of the MCC funding, the European Union may replace the US as Armenia's chief source of foreign aid for the first time since independence. From 2011 to 2013 the EU is expected to advance at least €157.3 million ($208 million) in aid to Armenia. ==Domestic business environment==

(housing both the Armenian Customs Service and the Armenian Tax Service)Since transition of power to new leadership in 2018 Armenian government works on improving domestic business environment. Numerous formerly privileged business are now required to pay taxes and officially register all workers. Mainly due to this there were 9.7% more payroll employees registered in January 2019 as compared to January 2018. In April 2019 Armenian parliament approved reforms of management of joint stock companies effectively enacting a blocking minority shareholders stake of 25% to cope with shareholder oppression. Following the advice of economic advisers who cautioned Armenia's leadership against the consolidation of economic power in the hands of a few, in January 2001 the government of Armenia established the State Commission for the Protection of Economic Competition. Its members cannot be dismissed by the government. Foreign trade facilitation In June 2011 Armenia adopted a Law on Free Economic Zones (FEZ), and developed several key regulations at the end of 2011 to attract foreign investments into FEZs: exemptions from VAT (value added tax), profit tax, customs duties, and property tax. Controversial issues Monopolies Major monopolies in Armenia include: • Natural gas import and distribution, held by Gazprom Armenia, formerly named ArmRosGazprom (controlled by Russian monopoly Gazprom) • Armenia's railway, South Caucasus Railway, owned by Russian Railways (RZD) • Electricity transmission and distribution (see Electricity sector in Armenia) • Newspaper distribution, held by Haymamul Former notable monopolies in Armenia : • Wireless (mobile) telephony, held by Armentel until 2004 • Internet access, held by Armentel until September 2006 • Fixed-line telephony, held by Armentel until August 2007 Assumed (unofficial) monopolies until 2018 velvet revolution: • Oil import and distribution (claimed by Armenian opposition parties to belonging to a handful of government-linked individuals, one of which – "Mika Limited" – is owned by Mikhail Baghdasarian, while the other – "Flash" – is owned by Barsegh Beglarian, a "prominent representative of the Karabakh clan") • Aviation kerosene (supplying to Zvartnots airport), held by Mika Limited • Various basic foodstuffs such as rice, sugar, wheat, cooking oil and butter (the Salex Group enjoys a de facto monopoly on imports of wheat, sugar, flour, butter and cooking oil. Its owner was a parliament deputy Samvel Aleksanian (a.k.a. "Lfik Samo") and close to the country's leadership.). According to one analyst, Armenia's economic system in 2008 was anticompetitive due to the structure of the economy being a type of "monopoly or oligopoly". "The result is the prices with us do not drop even if they do on international market, or they do quite belated and not to the size of the international market." According to the 2008 estimate of a former prime minister, Hrant Bagratyan, 55 percent of Armenia's GDP is controlled by 44 families. "I think you can only go so far with this economic model," Ngozi Okonjo-Iweala told a news conference in Yerevan. "Armenia is a lower middle-income country. If it wants to become a high-income or upper middle-income country, it can not do so with this kind of economic structure. That is clear." She also called for a sweeping reform of tax and customs administration, the creation of a "strong and independent judicial system" as well as a tough fight against government corruption. Takeover of Armenian industrial property by the Russian state and Russian companies Since 2000 the Russian state has acquired several key assets in the energy sector and Soviet-era industrial plants. Property-for-debt or equity-for-debt swaps (acquiring ownership by simply writing off the Armenian government's debts to Russia) are usually the method of acquiring assets. The failure of market reforms, clan-based economics, and official corruption in Armenia have allowed the success of this process. In August 2002 the Armenian government sold an 80 percent stake in the Armenian Electricity Network (AEN) to Midland Resources, a British offshore-registered firm which is said to have close Russian connections. On 5 November 2002, Armenia transferred control of 5 state enterprises to Russia in an assets-for-debts transaction which settled $100 million of Armenian state debts to Russia. The document was signed for Russia by Prime Minister Mikhail Kasyanov and Industry Minister Ilya Klebanov, while Prime Minister Andranik Markarian and National Security Council Secretary Serge Sarkisian signed for Armenia. On 1 November 2006, the Armenian government handed de facto control of the Iran-Armenia gas pipeline to Russian company Gazprom and increased Gazprom's stake in the Russian-Armenian company ArmRosGazprom from 45% to 58% by approving an additional issue of shares worth $119 million. This left the Armenian government with a 32% stake in ArmRosGazprom. The transaction will also help finance ArmRosGazprom's acquisition of the Hrazdan electricity generating plant's fifth power bloc (Hrazdan-5), the leading unit in the country. In December 2017 government transferred natural gas distribution networks in cities Meghri and Agarak to Gazprom Armenia for cost-free use. Construction of these was funded by foreign aid and costed about 1.3 billion AMD. Non-transparent deals Critics of the Robert Kocharyan government (in office until 2008) say that the Armenian administration never considered alternative ways of settling the Russian debts. According to economist Eduard Aghajanov, Armenia could have repaid them with low-interest loans from other, presumably Western sources, or with some of its hard currency reserves which then totaled about $450 million. Furthermore, Aghajanov points to the Armenian government's failure to eliminate widespread corruption and mismanagement in the energy sector – abuses that cost Armenia at least $50 million in losses each year, according to one estimate. Political observers say that Armenia's economic cooperation with Russia has been one of the least transparent areas of the Armenian government's work. The debt arrangements have been personally negotiated by (then) Defense Minister (and later President) Serge Sarkisian, initially Kocharyan's closest political associate. Other top government officials, including former Prime Minister Andranik Markarian, had little say on the issue. Furthermore, all of the controversial agreements have been announced after Sarkisian's frequent trips to Moscow, without prior public discussion. While Armenia is not the only ex-Soviet state that has incurred multi-million-dollar debts to Russia over the past decades, it is the only state to have so far given up such a large share of its economic infrastructure to Russia. For example, pro-Western Ukraine and Georgia (both of which owe Russia more than Armenia) have managed to reschedule repayment of their debts. ==Infrastructure==

Domestic Since early 2008, Armenia's entire rail network is managed by the Russian state railway under brand South Caucasus Railways. Metros Yerevan Metro was launched in 1981. It serves 11 active stations. Buses Yerevan Central Bus Station, also known as Kilikia Bus Station, is Yerevan's primary bus terminal, linking buses to both domestic and foreign destinations. Roadways Total length: 8,140 km, World ranking: 112 (7,700 km paved including 1561 km of expressways). International Through Georgia Russian natural gas reaches Armenia via a pipeline through Georgia. The only operational rail link into Armenia is from Georgia. During Soviet times, Armenia's rail network connected to Russia's via Georgia through Abkhazia along the Black Sea. However, the rail link between Abkhazia and other Georgian regions has been closed for a number of years, forcing Armenia to receive rail cars laden with cargo only through the relatively expensive rail-ferry services operating between Georgian and other Black Sea ports. It was controversially shut down by the Russian authorities in June 2006, at the height of a Russian-Georgian spy scandal. Upper Lars is the only land border crossing that does not go through Georgia's Russian-backed breakaway regions of South Ossetia and Abkhazia. The other two roads linking Georgia and Russia run through South Ossetia and Abkhazia, effectively barring them to international traffic. Through Iran A new gas pipeline to Iran has been completed, and a road to Iran through the southern city of Meghri allows trade with that country. An oil pipeline to pump Iranian oil products is also in the planning stages. As of October 2008 the Armenian government was considering implementing an ambitious project to build a railway to Iran. The 400 kilometer railway would pass through Armenia's mountainous southern province of Syunik, which borders Iran. Economic analysts say that the project would cost at least $1 billion (equivalent to about 40 percent of Armenia's 2008 state budget). As of 2010, the project has been continuously delayed, with the rail link estimated to cost as much as $4 billion and stretch . In June 2010, Transport Minister Manuk Vartanian revealed that Yerevan is seeking as much as $1 billion in loans from China to finance the railway's construction. Through Turkey and Azerbaijan The border closures by Turkey and Azerbaijan have severed Armenia's rail link between Gyumri and Kars; the rail link with Iran through the Azeri exclave of Nakhichevan; and a natural gas and oil pipeline with Azerbaijan. Also closed are road links with Turkey and Azerbaijan. Despite the economic blockade of Turkey on Armenia, every day dozens of Turkish trucks laden with goods enter Armenia through Georgia. In 2010 it was confirmed that Turkey will keep the border closed for the foreseeable future after the Turkey-Armenia normalization process collapsed. ==Labor market==

Labor occupation According to the 2018 HDI statistical update, Armenia had the highest percentage of employment in services (49.7%) and lowest share in agriculture (34.4%) among the South Caucasus countries. As of September 2024, the number of formally employed individuals in Armenia's labor market reached 776.8 thousand, with the following industries accounting for the highest share in employment: Unionization In 2018, about 30% of wage workers were organized in unions. At the same time, rate of unionization was dropping at average rate of 1% since 1993. Monthly wages According to preliminary figures from Statistical Committee of Armenia monthly wages averaged 172 thousand AMD in February 2019. It is estimated that wages rise at 0.8% for each additional year of experience and "the ability to solve problems and learn new skills yields a wage premium of nearly 20 percent". The Statistical Committee of Armenia reported that in 2020, the unemployment rate has been volatile reaching to 19.8% during the first quarter of the year and then decreasing to 16% during the fourth quarter. According to the latest reports on population of Armenia, in December 2020 the population consisted of 2.96million people and the average monthly earning during February 2021 was US$366.05. According to prime minister Nikol Pashinyan in January 2019, 562,043 payroll jobs were recorded, against of 511,902 in January 2018, an increase of 9.7%. This however does not match survey data published by the Statistical Committee of Armenia, according to which in 4th quarter of 2018 there were 870.1 thousand persons employed against 896.7 thousand employed persons in 4th quarter of 2017. The mismatch was highlighted by former PM Hrant Bagratyan. For the whole year of 2018 Statistical Committee of Armenia survey counted 915.5 thousand employed persons, an increase of 1.4% against previous year. In the same period unemployment rate of economically active population dropped from 20.8% to 20.4%. It fluctuated between 16% and 19% from 2008 to 2020, before dropping to 15.5% in 2021, 13.5% in 2022 and 12.6% in 2023 due to the strong economic growth of recent years. Female unemployment in Armenia Worldwide, women's unemployment rate is 6%, higher than men's by about 0.8 points. According to International Labor Organization, Armenia has the highest women's unemployment rate in post-Soviet countries, equaling 17.3% for women above 25. If we compare this rate with those of the neighboring countries (Latvia: 8.6%, Georgia: 7.7%, Azerbaijan: 4.8%), we can see that it is very high. In 2017, the National Statistical Service of Armenia stated that more than 60% of officially registered unemployed people in Armenia are women. One of the lecturers of Yerevan State University, Ani Kojoyan, mentioned that even though there is no issue in the legislation that becomes a reason for women's unemployment; however, there are some issues that are not mentioned in the legislation. Some of those issues are the fact that potential employers consider women's marital status, how many children they have, or if they are planning to get pregnant any time soon. Moreover, some women are not allowed to work by their husbands after graduating from higher educational institutions. She mentions that the most crucial problem affecting this phenomenon is the fact women do not stand up for their rights. It is also mentioned that according to various sources, there is an inequality in men's and women's monthly wages. In all the sectors, the average monthly salary of men is much higher than women even with the same years of education. It is stated that eliminating the discrimination between two genders would positively impact the country's economy. Ani Kojoyan mentions that this is a crucial problem for the economy except for being a women's rights violation. Thus, the Armenian government should take care that unemployed women can find jobs and become taxpayers. Migrant workers Since gaining independence in 1991, hundreds of thousands of Armenia's residents have gone abroad, mainly to Russia, in search of work. Unemployment has been the major cause of this massive labor emigration. OSCE experts estimate that between 116,000 and 147,000 people left Armenia for economic reasons between 2002 and 2004, with two-thirds of them returning home by February 2005. According to estimates by the National Statistical Survey, the rate of labor emigration was twice as higher in 2001 and 2002. ==Natural environment protection==

Environmental Project Implementation Unit implements projects related to Natural environment protection. Armenia's greenhouse gas emissions decreased 62% from 1990 to 2013, averaging −1.3% annually. Armenia levies an environmental tax on air and water emissions and waste disposal under its Tax Code, with environmental standards and permitting overseen by the Ministry of Environment. ==See also==