"Armenia is trying to curb inflation"

Last year, the Armenian economy grew by 5.7% with an inflation rate of 7.7%, which is both the highest growth rate among the EAEU countries and the lowest in terms of inflation. Armenian Minister of Economy Vahan Kerobyan said this in an interview with Kommersant when answering a question about how he assesses the impact of Western sanctions and the expected decline in the Russian economy on Armenia.

“At the beginning of the year, we saw an acceleration in growth rates - up to 12% in January-February, and expected that this trend would continue throughout the year, but the situation has changed, it had to be completely rethought,” the head of the department noted.

“The priority now for us is to ensure food security. Our work is aimed primarily at ensuring that people live better, so the main task now is to curb inflation. We also see that the uncertainty of the rouble exchange rate has already had a negative impact on our exporters, there are concerns about mutual trade. If in January-February, imports from Russia (to Armenia) increased by 70% compared to last year, and exports by 45%, then in March both indicators sank significantly,” Kerobyan stated.

According to him, the primary task of the Armenian Cabinet in the current situation is to find tools that will allow companies to trade freely and have a horizon of certainty in currency risks.

“We are seeing a reduction in the migration flow from Armenia: the season is starting, but we have a positive migration balance. This does not worry us much since there are also many vacancies in Armenia. As for investment plans, we adhere to the agreements concluded, our (Russian) partners confirm that the agreed investment projects will be implemented according to the plan,” the head of the Armenian Ministry of Economy said.

"Armenia will not withstand the second Iran"

“Russia is our largest trading partner, so it is in our national interest to protect mutual trade. Based on this, we explain to foreign partners that we simply have no other option. There are fears, which is why we are working so as not to provoke the spread of sanctions,” the Minister of Economy of Armenia Vahan Kerobyan said answering the question whether local companies and banks have fears that they may be subject to secondary sanctions when interacting with Russian counterparties.

“Iran, one of our big neighbours, is also under sanctions. For decades we have not been able to work with local companies at full capacity, the second such situation is simply impossible for us,” he added

According to him, almost all the companies that are currently opening in Armenia “do not leave Russia, but rather expand.”

“For us, these are new investors, new jobs. Such companies can count on the same benefits that were in effect before. We are talking, in particular, about the exemption of IT companies from almost all taxes, except for the personal income tax at a rate of 10%. Initially, these benefits were supposed to be valid until the end of 2023, but now their period has been extended. You also need to take into account that Armenia has a low level of social benefits - no more than $100 per person. So, for IT companies, the total tax per person is 10% of the salary and social benefits,” said the head of the economic department of Armenia.

“I think that there will be interesting facts about how Armenian companies hire Russian citizens and about opening new companies. In terms of tax collections, we closed the first quarter with a surplus, and this despite the fact that the issue of distribution of customs payments has not yet been resolved within the framework of the EAEU - in what currency to do this. In terms of trade in the domestic market, we see an increase of about 25% compared to March last year, but there is also the effect of price growth. According to various estimates, the influx amounted to 50-70 thousand people, of which half are with Armenian roots, that is, these are people who lived in Russia and have now returned; the other half are citizens of the Russian Federation. It is difficult for us to say which of them came as a tourist, and which - for the purpose of living. In total, such an influx is about 2% of the population of Armenia,” the minister concluded.

Russia and Armenia agreed on the restoration of transport communications in the South Caucasus

Armenian Deputy Prime Minister Mher Grigoryan and his Russian counterpart Alexei Overchuk discussed the restoration of transport communications in the South Caucasus at a working meeting held in Moscow, the press service of the government of Armenia reported.

“During the meeting, the topic of restoring transport communications in the South Caucasus was discussed… within the framework of the work of the trilateral working group chaired jointly by the Deputy Prime Ministers of the Republic of Armenia, the Russian Federation and the Republic of Azerbaijan,” the Armenian Cabinet informed. The vice-premiers also discussed topical issues of the Armenian-Russian trade and economic cooperation.