In the year 2022, the overall volume of investments in Armenia amounted to 1 trillion 688 billion AMD or approximately 20% from the GDP. Analyzing the recorded indicators, PM Nikol Pashinyan announced the following from the National Assembly months ago. “Direct foreign investments almost tripled in 2022, amounting to approximately 1 billion USD, thus significantly increasing compared to 2021 and all previous years. This indicator is an absolute record for Armenia”.
In terms of a constantly increasing pace of investment flows, Prime Minister particularly emphasized ongoing betterment of supporting mechanisms and tools for investors, in alignment with the governmental strategic approaches.
According to the data from the first trimester, the volume of foreign net investment flows in the real sector of the economy accounts for 33 billion 362 million AMD. Compared to the same period of the year 2022, between January and March 2023 direct investments have increased by 10 billion 928 million AMD.
Given the strategic significance of investment engagement, the Investors’ Support Center has been operating in Armenia over the last few years, which aims to generate interest among investors towards Armenia at the core. Research by the foundation shows that investors are attracted to Armenia owing to several factors, such as the legislation regulating the investment field, continuously improving tax system, multi-vector commercial and economic relations maintained by the state.
The strategic significance of boosting investment engagement in Armenia has been voiced by numerous specialists throughout years. HayEconomBank Board Chairman Saribek Sukiasyan reflected on the investment policy led by the RA in one of his interviews back in 2018. “The opportunities to make Armenia an appealing platform for investors are ample. Thanks to the Velvet Revolution, our country is highly reputable in the international arena and that very circumstance should be used in favor of economic development and wellbeing of citizens”.
Sukiasyan also noted that investment engagement requires systemic work by the state, that is, combination of various efficient factors. “The political stability within the country and effective anti-corruption fight alone are not sufficient to boost investment. Tax reduction and consolidation should be taken into consideration, aiming to simplify taxpaying mechanisms”.
Saribek Sukiasyan views tax reduction as a good incentive for investment engagement and, consequently, for an increase in the number of taxpayers.
“An investor always wants to make an investment in a country where the laws do not balk business development, and there is certainty that those will not undergo changes for at least 5-10 years to come”,- highlighted Sukiasyan.
Also, he noted that positive shifts in the political sphere typically create newer and bigger opportunities for foreign investment. “Fight against monopolization, prevention of corruption risks, favorable business environment these days encourage lots of people to set up a business or to develop and expand an already operating one”.
According to Sukiasyan, positive changes within the country establish a firm bond between the economic field and the banking system. “Current positive changes greatly contribute to an increase in economic activity and, as you know, the activity of the real sector inevitably leads to an increase in the activity of the banking system”.