Armenia - Country Commercial Guide
Market Overview
Last published date:

Armenia is a small market that has faced long-term geographical and geopolitical challenges to its economy, including the closure of two of its four international borders. Yet Armenia’s economy continues to perform well, with the real GDP growth reaching 12.6 percent in 2022 fueled by large foreign exchange and migrant inflows and an improving business environment.  Following Russia’s February 2022 further invasion of Ukraine, tens of thousands of highly educated Russian, Ukrainian, and Belarussian technology professionals and hundreds of companies relocated to Armenia, further bolstering the already rapidly growing high-tech sector.  Driven by expansion in construction, service, and trade-related sectors in the first half of the year, the IMF projects real GDP to grow by over seven percent in 2023. Current Armenian authorities are focused on strengthening commercial ties with the United States and reducing corruption. Despite that positive trajectory, the geopolitical risks remain substantial with ongoing regional tensions and international sanctions against Russia.

In May 2015, the United States and Armenia signed a Trade and Investment Framework Agreement (TIFA). The TIFA provides strategic principles for dialogue on trade and investment issues.  The agreement creates a platform for high-level engagement to discuss issues of mutual interest with the objective of improving cooperation and enhancing opportunities for trade and investment between Armenia and the United States.

Armenia also became a member of the Russian-led Eurasian Economic Union (EAEU) in 2015.  This membership provides Armenian products direct access to the Russian, Belarusian, Kazakh, and Kyrgyz markets with a combined population of about 190 million and a combined gross domestic product of nearly $2 trillion.  As a member of the EAEU, Armenia must harmonize its tariffs with the bloc’s common external tariff, which will substantially raise average tariffs over time.

In November 2017, the European Union and Armenia signed a Comprehensive and Enhanced Partnership Agreement aimed at deepening relations.  The agreement is expected to improve the investment climate, stimulating growth, creating jobs, and building a better environment in which businesses can grow.

With international donor assistance, the Armenian government has been implementing a program of reforms aimed at attracting trade and foreign investment by improving the business environment and streamlining tax and customs administration.  Armenia has the most liberal investment regime among EAEU countries, making it an attractive location from which to base international and regional operations focused on EAEU markets. The country has benefited from Generalized System of Preferences (GSP) access to the United States, EU, Canada, and Japan, and a free trade agreement with neighboring Georgia that remains in effect even after Armenia’s accession to the EAEU.   Legal authorization for duty-free treatment under the GSP program expired for all participating countries on January 1, 2021.  The GSP program can only be renewed by Congress.

Armenia is classified as an upper middle-income country by the World Bank, with a per capita GDP of     approximately $7,014.  The average monthly salary in Armenia was about $665 in 2022.  Unemployment is 13 percent.  The government has aggressively pursued strategies to improve tax administration, reduce the size of the shadow economy, and put public debt on a downward trajectory. Tax reforms have aimed at lowering rates, broadening the base, and improving administration.  At the same time, the government has committed to greater social spending and capital expenditures that can provide a basis for continued economic growth.

In 2022 Armenian imports grew by nearly 64 percent to $8.8 billion and consisted mainly of petrochemicals, precious stones, consumer goods, vehicles, equipment, and machinery.  The top sources of Armenia’s imports are Russia, China, Iran, the United Arab Emirates, Germany, Italy, Georgia, and the United States.  The United States exported $195 million worth of goods Armenia in 2022.  Top U.S. exports to Armenia were electrical machinery, vehicles, precious metals, and poultry.

In 2022, Armenia exported more than $5.4 billion worth of goods, a 78 percent increase from 2021.  Exports were concentrated in agriculture products, metals (especially copper, gold, and iron), tobacco, and alcoholic beverages.  The leading export destinations for Armenian goods in 2022 were Russia, United Arab Emirates, China, Switzerland, Bulgaria, Netherlands and Iraq, which combined accounted for approximately two-thirds of all exports.  Russia is the leading export destination, accounting for nearly half of all merchandise trade from Armenia. Armenian exports to the United States totaled $78 million in 2022

Armenia’s top exports to the United States were aluminum, precious metals, apparel, and beverages. 

Political Environment

Please visit State Department’s website for background on Armenia’s political and economic environment.