Armenia’s economy has exhibited significant growth since 2021, demonstrating remarkable resilience and development as its current political leadership has reduced corruption and promoted the knowledge sector. This has happened even as Armenia, a small market, faces long-term geographical and geopolitical challenges to economic development, perhaps most notably, the continued closure of two of its four international borders. Consumption spending and capital inflows are key economic drivers, contributing to GDP growth of 5.9 percent in 2024. The International Monetary Fund (IMF) predicts Armenia’s real GDP growth will maintain its strength, forecasting a growth rate of 4.5 percent in 2025.
Armenia’s government is focused on reducing corruption and diversifying the country’s economic relationships, including by strengthening commercial ties with the United States. Despite its positive trajectory, Armenia’s geopolitical risks remain substantial with ongoing regional tensions and international sanctions against Russia and Iran, both of which are important trading partners for Armenia.
On January 14, 2025, The United States and Armenia commemorated deepening bilateral ties by signing a Strategic Partnership Charter. Both sides committed to continue efforts to enhance economic cooperation and resilience, promote advanced technologies, and bolster trade, energy, and food security for a prosperous and secure Armenia. The August 2025 Washington Summit, where the leaders Armenia and Azerbaijan issued a joint declaration on their commitment to achieving lasting peace, strengthened this partnership, with the United States and Armenia signing three bilateral memoranda of understanding with the goal of unlocking the great potential of the South Caucasus region in trade, transit, energy, infrastructure, and technology.
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 and other regional 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 $8,500. The average monthly salary in Armenia was about $734 in 2024. Unemployment has fallen to around 13 percent, one of the lowest levels since the country declared independence in 1991. The government has aggressively pursued strategies to improve tax administration and compliance, 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 2024 Armenian imports grew by nearly 33.8 percent from 2023 to over $17 billion and consisted mainly of petrochemicals, precious stones and metals, consumer goods, vehicles, equipment, and machinery. The top sources of Armenia’s imports are Russia, China, Iran, the United Arab Emirates, EU, Georgia, and the United States. The United States exported approximately $161 million worth of goods to Armenia in 2024. Top U.S. exports to Armenia were motor vehicles and parts, used merchandise, control instruments, pharmaceuticals and medicines, and poultry.
In 2024, Armenia exported more than $13 billion worth of goods, a 53.1 percent increase from 2023. Exports were concentrated in agriculture products, metals (especially copper, gold, and iron), precious stones and metals, machinery, equipment and mechanisms, tobacco, and alcoholic beverages. The leading export destinations for Armenian goods in 2024 were United Arab Emirates, Russia, China, Switzerland, the EU, and Iraq. Armenian goods exports to the United States totaled $122 million in 2024, with top products including precious stones and metals, apparel, beverages, fruits and vegetable preserves, and specialty food. Armenia also exported a significant level of ICT services to U.S. firms.
Please visit State Department’s website for background on Armenia’s political and economic environment.