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ARMENIA

• Total Area - 29.800 sq/km• Population - 3,231,900• Currency – Armenian Dram

BORDER COUNTRIES /Border length in km

1. Azerbaijan - 566 km 2. Georgia - 164 km3. Iran - 35 km4. Turkey - 268 km

YEREVAN The capital of Armenia

GDPby years (percent of growth)

13.8%

13.4% 20062007

20082009

2011 Jan-Jun

4.6%-14%

6.8%

2.6%

2010

14% 2005

Soviet Era Transition Period The Next Decade

Exploitation of raw materials

Chemical processing

Extractive industries

Real estate development

Modernization of industrial processes

Infrastructure deployment

Education, science and technology

Services and E-services

Complex engineering

E-government and technoparks

INFLATION RATES by years (percent)

9.4%6.5%

5.2%

6.7% 20072008

2009 2010 2011*

5%

* estimated

Major Export Items for Armenia are:

• Software• Nonferrous metals, • Unwrought copper, • Diamonds, • Mineral products• Food products

Russia 15.9%

Bulgaria 15.5%

United States 8.2 %

Netherlands 9.7 %

Germany 13.1%

Iran 5.2 %

China 3.1%

No export dutyNo export duty

8

IMPORTS BY COUNTRY

9

ARMENIAN EXPORTS BY COUNTRY 2010

10

Trade over relation by GNP

11

Armenian exports to Greece

12

Greece’s exports to Armenia

Foreign Direct Investments(million USD)

840.7

1257.6

670

3052006

2007

20082009 2010

693.4

Russia 43.7%

Germany 6.5%

Argentina 5.5 %

USA 4.6 %

France 12.4%

Greece 6.4%

Telecommunication Energy Transport Mining sector IT sector Production of food and beverages

• MFN regime with 150 countries (WTO full membership)

• FTA regime with CIS countries (tariff free access to 250 million consumers market)

• GSP regime with EU, USA, Canada, Japan

• GSP+ with the EU

Ratin

gA

rmenia

Ratin

gA

rmenia

Ratin

gA

rmenia

Ratin

gA

rmenia

2008 2009 2010 2011

28

31

38

36

The Index covers 10 freedoms – from property rights to

entrepreneurship – in 183 countries

The Wall Street Journal and The Heritage Foundation

Rates

VAT– 20 %PROFIT TAX – 20%

No export duty

import tariffs0% Or 10%

Simplified taxation for Small and Medium Entreprises

INCOME TAX – max.20%

• All Exports from Armenia are Duty Free• The Import Tariff Rates are 0% or 10 %• Armenia is a Member of World Trade

Organization (WTO)• Armenia Uses the Harmonized Code System

(HS) for Tariff Classification• Full list of products with corresponding

tariffs – www.customs.am

In the nearest future two free economic zones will be established in Armenia.

1.Agriculture and food processing oriented FEZ - on the territory adjacent to Zvartnots international airport2.High tech oriented FEZ – on the base of the plant “Mars”

The Law of the Republic of Armenia on Free Economic Zones defines a number of incentives for companies in FEZ:

The operators of free zones are granted profit tax, income tax,  value added tax, property tax, and customs duty payment privileges.

More than 60 Universitiesand Higher educational

Institutes,

8 foreign universities: • 5 Russian Universities• American University in

Armenia• French University• European University.

Approximately 80.000 students

More than 60 Universitiesand Higher educational

Institutes,

8 foreign universities: • 5 Russian Universities• American University in

Armenia• French University• European University.

Approximately 80.000 students

More than 100 Research

& Development

Centers

More than 100 Research

& Development

Centers

280.0Communications

65.3Health care

71.0IT services

70.4Financial

services

48.2Tourism

70

38

455Food industry

265Metals

252Mining

Construction

materials

Machinery

Services

Goods

2006 Size USD Millions

Growth rate Percent, 2002-2006

6,1

21,7

11,4

5,8

10,3

25,3

25,2

15,1

47,8

17,4

Bio Agriculture Information Technology

Chemical Industry

Energy Tourism

Armenian IT sector is dominated by foreign investors

• The annual growth of IT companies’ establishment – 20-25%

• Export of 63% of IT output goes to over 20 countries (USA,

Europe and the CIS)

• Support of Government of Armenia through its declaration of

IT as a

priority sector and by being itself a lead user of IT

• Existence of Skillful and Creative Cost-Efficient Labor Force.

Monthly

salary of experienced software developer in Armenia is

900USD

• More than 6800 IT related Students

Innovative, ready for licensing out products in:• Animal health

• Agriculture

• Advanced technology for polyacrylamide hydrogels production

• Innovative drugs for treatment of oncology, cardiovascular and

CNS

diseases in different development phases

• Innovative new strains of bacteria effective in diary production

with long shelf life and better properties

ARMENIA: Economy OverviewARMENIA: Economy Overview

Amines & DerivativesAmines & Derivatives

Amino Acids & DerivativesAmino Acids & Derivatives

Peptides Peptides

HeterocyclesHeterocycles

Furan, Pyran and its derivativesFuran, Pyran and its derivatives

EstersEsters

Bioactive & Natural CompoundsBioactive & Natural Compounds

Physiological Active CompoundsPhysiological Active Compounds

Polyhedric SystemsPolyhedric Systems

Quinozolines Quinozolines

Screening,Synthesis of Biologically Screening,Synthesis of Biologically Active CompoundsActive Compounds

Proteins & Ferments Proteins & Ferments

AgrochemicalsAgrochemicals

Speciality Chemicals Speciality Chemicals

Inorganic & Organic Reagents Inorganic & Organic Reagents

Electrophoresis ReagentsElectrophoresis Reagents

Molecular Biology Reagents Molecular Biology Reagents

Miscellaneous OilsMiscellaneous Oils

Pharmaceutical Forms Pharmaceutical Forms

Pharmaceutical SubstancesPharmaceutical Substances

Fine ChemicalsFine Chemicals

The energy sector is one of the most developed sectors of the

Armenian economy Nuclear, thermal, hydro power production Renewable and alternative energy, including wind energy and

biofuels – covers almost 25% of demand of Armenia, and is

planned to reach 30% or more by 2030. Unique business opportunity for investors.

* according to the law the Electric Networks of Armenian

buys green energy from suppliers for the period of 15

years, thus securing the market for the producers for

that period.

Jewelry and diamond processing are considered a very attractive field for investment in Armenia based on the existence of skillful diamond cutters, modern equipment and tax privileges in Armenia.

Diamond processing is a predominant part of this sector's activities. Nevertheless, jewelry, including gold accessories, golden wristwatches, jewelry articles and processing of semi-precious stones has an old tradition in Armenia.

Today, 27 companies with 5000 employees

(2500 in diamond processing) are

operating in this sector, excluding individual

jewelers.

Today, 27 companies with 5000 employees

(2500 in diamond processing) are

operating in this sector, excluding individual

jewelers.

•Agriculture plays important role in the economy of Armenia – constitutes 20 % of GDP Total volume of production in 2009 was 555,7 bln AMD (around 1,6 bln USD)

Agriculture

• Tourism and tourism infrastructure development are among the

priorities of the Government of the Republic of Armenia

• Annual growth of the number of incoming tourists in Armenia is

15-20% in average

•Armenia is the first country to adopt Christianity as a state

religion in 301 AD – more then 5000 historical monuments spread

around the country, Some included in World Heritage

• The longest ropeway in the World “Wings of Tatev” – 5.7 km

• Ski resorts – Tsakhkadzor with modern 6 lifts rope-way (926-

1388m) with carrying capacity up to 1200 persons

•Mineral Spa resports – Jermuk, Bjni, Dilijan, Arzni,

Macroeconomic Stability: Spend and Balance

GDP Growth Rate2000=100%

230%209%

124%141%

156%178%

184%

110%

0

50

100

150

200

250

2001 2002 2003 2004 2005 2006 2007 2008

Equity and debt financingthrough public-private investment funds

Venture fundscapitalizing high potential opportunities

Project-based investments leveraging core assets

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Thank you for your attention

contact info : ecocom-yerevan@mfa.gr