Armenia's Economic Pulse

[Mher]

Re: Armenia's Economic Pulse

Incredible sustained growth rate for an industry. Especially considering the fact that it was done during post recession years of stagnation. The industry now represents almost 5% of the national GDP and about 40% of exports. Just by itself, the annual growth represents about a 1% GDP growth for the entire country. If it maintains this rate of growth, which seems realistic, the sector will become a billion dollar industry by 2018, and will make up 10% of GDP by 2019.

[Mher]

Re: Armenia's Economic Pulse

ONEArmenia Partnering with ArmTab Factory for Upcoming Campaign

YEREVAN—This December, Armenia is entering a new phase of its contemporary history. The country’s first tablet factory is opening its doors to the public, producing domain-specific customized Android tablets to individuals and businesses across the globe.

To mark this milestone, ONEArmenia (1A) is partnering with ArmTab Technologies and the Orran benevolent family center to put the factory’s first 100 tablets into the hands of 100 Armenian teens. Through crowdfunding, 1A hopes to unite the future generation of tablets with the future generation of young people.

The launch of these tablets are a valuable bridge into uncharted territory on many fronts for Armenia. When Vahan Chakarian, Founder and CEO of ArmTab Technologies, made the decision to include Armenia in the production of customized educational tablets several years ago through the American company called Minno, he recalled, “I told [my colleague] that Armenia was known as the ‘Silicon Valley’ of the Soviet Union, and to this day, has a strong IT sector with tremendous untapped talent.”


However, the hardware for these tablets was always purchased, produced, and assembled in either China, Hong Kong, and Taiwan. Until now, Armenia’s role had been limited to the development of software and programming. ArmTab is the first real instance of Armenia acting as an independent and competitive agent in the tablet industry. While the factory still receives hardware from foreign countries, its assembly and programming are now being done entirely in Armenia by ArmTab’s hand-picked staff of experts.

The factory will not only provide a number of jobs to local IT personnel in Armenia (a large portion of which are women), but it is also setting the bar high for future factories in other industries to emerge. Located a few steps past the Mergelyan Institute of Mathematical Machine’s once-glorious gates, its humble exterior belies an impressive and cutting edge interior.

Rafayel Ghasabyan, ArmTab’s Managing Director, confirms that the factory was designed according to the highest international standards. During its infancy, he and his colleagues visited over 20 leading factories across the globe, selecting the best features from each and incorporating them into ArmTab’s design.

It was important to ArmTab’s founders that the factory’s very first tablets have an immediate impact inside Armenia. Organizers hope that partnering with 1A will help raise awareness of the significance of this turning point and what it means for the future. The 1A-sponsored tablets, which have adopted the moniker 1tab, have been custom-made specifically for the month-long campaign. Each tablet will be equipped with educational programs and Armenian-language resources and plans are in order to program digitized Armenian texts on the Android operating systems. All of this will ensure the tablets’ continued educational value, long after they have been distributed.

To support the campaign and be a part of this exciting development, please visit 1A’s Indiegogo campaign. Together, we can teach through technology.

http://asbarez.com/130235/onearmenia-partnering-with-armtab-factory-for-upcoming-campaign/

[Haykakan]

Re: Armenia's Economic Pulse

Good news there Mher. IT is a good way to go for a landlocked country with limited resources. I am a bit surprised the education system is not on par yet.

[Mher]

Re: Armenia's Economic Pulse

Good news there Mher. IT is a good way to go for a landlocked country with limited resources. I am a bit surprised the education system is not on par yet.

industry that doesn't need physical transport for export in a country with possibly the worst external transport route options in the world. It's the ultimate miracle. It's almost an evolution based on environment. Estonia used the same strategy to develop into the most successful post soviet economy. There is no reason why we can't do the same. Check out this new project: https://www.kickstarter.com/projects...-presentations it's getting a lot of attention in major tech and business publications like forbes, wired, financial times, etc

[Mher]

Re: Armenia's Economic Pulse

Statistical Service: Consumer prices went up 3 percent in December

Consumer prices increased by 3 percent in Armenia in December 2014 as compared to November.

According to Armenia’s National Statistical Service, prices for food products, alcoholic drinks and tobacco products went up 5.1 percent, while prices for nonfood products grew by 0.2 percent.

In January-December 2014, the average monthly growth of consumer prices was 0.4 percent, down by 0.1 percent as compared to the same period in 2013 (0.5 percent).

In December 2014, the highest price increase was registered in the cities of Gyumri and Ashtarak. In Yerevan, consumer prices increased by 2.7 percent.

http://www.panorama.am/en/economy/2015/01/07/armstat/

[Mher]

Re: Armenia's Economic Pulse

Moody's expects Russia GDP to influence Armenia's credit rating — agency

NEW YORK, Januart 16. /TASS/. Russia's GDP will decrease by 5.5% in 2015 which in turn will negatively influence Armenian economy, experts from Moody's Investor's Service said in their report published Thursday. The statement on the official website came as the service downgraded Armenia's issuer and bond rating to Ba3 from Ba2, and changed the outlook to negative from stable.

"Moody's expects that Russia's GDP will contract by 5.5% in 2015, weakening Armenia's economic activity given its historically strong correlation with Russia's growth cycle via remittances and trade channels, with Russia accounting for 23% of total Armenian exports," the statement said.

The agency experts believe that «the impact of Russia's economic downturn on Armenia's economy will be more significant than currently expected.".

http://itar-tass.com/en/economy/771493

[Mher]

Re: Armenia's Economic Pulse

Russia’s GDP Estimated To Contract By 5.5% In 2015, Impacting Armenia's Economy: Moody’s
By Kukil Bora January 16 2015 3:27 AM

Russia’s GDP is expected to decrease by over 5 percent in 2015, in turn weakening the economy of its neighbor Armenia, which shares close trade ties with the former, according to a new report by Moody's Investors Service, published on Thursday.

The New York City-based financial services firm said that contraction of Russia’s GDP will adversely impact Armenia's economic activity due to the interdependence between the economies of the two countries.

“Moody's expects that Russia's GDP will contract by 5.5% in 2015, weakening Armenia's economic activity given its historically strong correlation with Russia's growth cycle via remittances and trade channels, with Russia accounting for 23% of total Armenian exports,” Moody’s report said.

The latest forecast is in line with the announcement by Russia's ministry of economic development on Wednesday. The Russian ministry had said that the country’s GPD may fall by 5 percent in 2015 if oil prices remain at about $40 a barrel, Russia’s Tass news agency reported, adding that the rate of ruble would remain at 60-70 per dollar in 2015 if this oil price level persists.

Meanwhile, Ksenia Yudaeva, Russian central bank's first deputy head, said that it would stabilize inflation at 8-10 percent in 2015, while the country’s currency will stabilize in the first quarter or early in second quarter of this year.

The ruble weakened 41 percent against the dollar last year. On Dec. 16, the central bank took a major step to boost the ruble and rescue the country’s sanctions-hit economy by increasing its key interest rate to 17 percent, up from 10.5 percent.

“We are losing something with the oil prices, but we are winning with the devaluation, in terms of the budget,” Russia’s Economy Minister Alexei Ulyukayev said, in an interview with Bloomberg TV, on Wednesday. “We think we have possibilities in 2016 and 2017 to have a positive real GDP performance.”

http://www.ibtimes.com/russias-gdp-estimated-contract-55-2015-impacting-armenias-economy-moodys-1785574

[Mher]

Re: Armenia's Economic Pulse

Russia's Economic Funk Forces Armenia to Raise Interest Rates

Reuters
Jan. 22 2015 18:46 Last edited 18:46

YEREVAN, Armenia — Armenia's Central Bank raised its key refinancing rate to 9.5 percent from 8.5 percent on Thursday, becoming the latest country to try to protect itself from Russia's financial crisis.

Armenia, a former Soviet state of 3.2 million people, is closely tied to Russia through trade and remittances. It also belongs to Russian President Vladimir Putin's Eurasian Union, a bloc he hopes will rival the European Union.

A plunging Russian ruble, pulled down by a weak oil price and Western sanctions over the Ukraine crisis, has weakened Armenia's currency, the dram, to 478 to the dollar in January. It traded at 404 drams to the dollar a year earlier.

AmRating, Armenia's national rating agency, said in a statement the Central Bank's decision was due to a "decline in demand due to the fall in private remittances, a decline in foreign investment and inflationary expectations."

Annual inflation stood at 4.6 percent in December, the Central Bank said, up from 2.6 percent the month before. Monthly inflation in December came in at 3.0 percent, compared with 1.3 percent in November.

The government forecasts annual inflation in a range of 2.5-5.5 percent in 2015, the same as last year's target.

Analysts said the decision was influenced by the European Bank of Reconstruction and Development's decision to cut its forecast for growth this year to zero from 3.5 percent.

Moody's also downgraded Armenia's bond rating to Ba3 from Ba2 this month, changing its outlook to negative from stable. It cited declining remittances, uncertain foreign investment, exchange volatility and pressure on foreign exchange reserves.

Russia is Armenia's largest trading partner — bilateral trade exceeded $1.5 billion in 2013, mainly imports to the South Caucasus country, which is nestled between Iran, Georgia and regional rival Azerbaijan.

Money transfers from workers in Russia to Armenia fell in November last year by 35.4 percent year-on-year to $95.1 million, or 82 percent of a total amount of transfers.

Armenia's economy grew by 2.3 percent in the first half of last year but the government said growth in 2014 would be lower than an initially projected 5.2 percent. It forecast 4.1 percent growth in 2015.

The International Monetary Fund cut its forecast to 2.6 percent from 3.6 percent in 2014 and to 3.3 percent from 4.3 percent in 2015.

"Economic growth in Armenia will stagnate this year … It may even decline," said Vilen Khachatryan, an independent analyst.

http://www.themoscowtimes.com/business/article/russia-s-economic-funk-forces-armenia-to-raise-interest-rates/514779.html

[Mher]

Re: Armenia's Economic Pulse

Government Approves Tax Break For Foreign Investors

Sargis Harutyunyan

Հրապարակված է՝ 23.01.2015

In an effort to attract more foreign investment, the Armenian government unveiled on Thursday a bill that would all but exempt large-scale exporters from the country’s 20 percent corporate profit tax.

The bill approved during a weekly cabinet meeting chaired by Prime Minister Hovik Abrahamian sets a profit tax rate of just 2 percent for manufacturing companies exporting at least 50 billion drams ($106 million) worth of goods other than metals and ores annually. Officials said it will be sent to the Armenian parliament dominated by government loyalists in the next few days.

“This is one of the unconventional government steps aimed at stimulating exports,” Abrahamian told ministers. He said greater exports would mean more jobs and other tax revenue.

According to the National Statistical Service (NSS), Armenian exports rose by 2.7 percent in January-November 2014 to almost $1.4 billion drams. Copper, other base metals and ore concentrates accounted for 45 percent of the export revenue. The proposed tax break will not apply to the companies manufacturing them.

Deputy Finance Minister Vakhtang Mirumian, who submitted the bill to the government for approval, said that no company involved in the other sectors of Armenia’s economy boasts exports worth 50 billion drams or more at present. “This [tax privilege] is primarily geared towards foreign investors that would come to Armenia, invest here and export their products,” he told reporters.

Mirumian said the government is now holding “tentative negotiations” with some potential investors. But he declined to name them or give other details.

Over the past year, President Serzh Sarkisian has repeatedly urged foreign investors to take advantage of Armenia’s accession to the Russian-led Eurasian Economic Union (EEU). He has argued that manufacturing firms set up by them would have tariff-free access to the Russian market.

Raffi Mkhjian, a businessman heading the Armenian Union of Exporters, questioned the wisdom of the tax break initiated by the government. Mkhjian said the government should mainly focus on small and medium-sized enterprises (SMEs) in its efforts to boost exports. “It’s SMEs that can save us today,” he told RFE/RL’s Armenian service (Azatutyun.am).

http://www.azatutyun.am/content/article/26808405.html

[Haykakan]

Re: Armenia's Economic Pulse

Government Approves Tax Break For Foreign Investors

Sargis Harutyunyan

Հրապարակված է՝ 23.01.2015

In an effort to attract more foreign investment, the Armenian government unveiled on Thursday a bill that would all but exempt large-scale exporters from the country’s 20 percent corporate profit tax.

The bill approved during a weekly cabinet meeting chaired by Prime Minister Hovik Abrahamian sets a profit tax rate of just 2 percent for manufacturing companies exporting at least 50 billion drams ($106 million) worth of goods other than metals and ores annually. Officials said it will be sent to the Armenian parliament dominated by government loyalists in the next few days.

“This is one of the unconventional government steps aimed at stimulating exports,” Abrahamian told ministers. He said greater exports would mean more jobs and other tax revenue.

According to the National Statistical Service (NSS), Armenian exports rose by 2.7 percent in January-November 2014 to almost $1.4 billion drams. Copper, other base metals and ore concentrates accounted for 45 percent of the export revenue. The proposed tax break will not apply to the companies manufacturing them.

Deputy Finance Minister Vakhtang Mirumian, who submitted the bill to the government for approval, said that no company involved in the other sectors of Armenia’s economy boasts exports worth 50 billion drams or more at present. “This [tax privilege] is primarily geared towards foreign investors that would come to Armenia, invest here and export their products,” he told reporters.

Mirumian said the government is now holding “tentative negotiations” with some potential investors. But he declined to name them or give other details.

Over the past year, President Serzh Sarkisian has repeatedly urged foreign investors to take advantage of Armenia’s accession to the Russian-led Eurasian Economic Union (EEU). He has argued that manufacturing firms set up by them would have tariff-free access to the Russian market.

Raffi Mkhjian, a businessman heading the Armenian Union of Exporters, questioned the wisdom of the tax break initiated by the government. Mkhjian said the government should mainly focus on small and medium-sized enterprises (SMEs) in its efforts to boost exports. “It’s SMEs that can save us today,” he told RFE/RL’s Armenian service (Azatutyun.am).


http://www.azatutyun.am/content/article/26808405.html

Cool incentive. Too bad it does not apply to agricultural goods.