What makes Armenia the best spot for investments?
Armenia "inherited" a failing economy from the Soviet system when it attained independence, placing it in the most precarious position of all the Transcaucasia nations. The food-processing industry in Armenia changed from being an agrarian-industrial nation with advanced metalworking, mechanical engineering, chemical engineering, and lighting technologies to a small state that could not boast either rich natural resources or favorable geographical position or fertile soils. Due to the Nagorno-Karabakh conflict, which cut it off from Azerbaijan and Turkey, as well as the Georgian-Abkhazian conflict, which cut it off from Russia (all cargo transportation was done via the Abkhazian railway), landlocked Armenia was under an economic blockade.
Вy 1991, Privatization began. Agriculture grounds were privatized first, followed by small and medium-sized industrial enterprises, and then major ones in 1995.
Following the signing of the armistice with Azerbaijan and the receipt of funding from the IMF and the World Bank in 1994, the national economy gradually stabilized. While the inflation rate decreased, the GDP slightly increased. Several industrial enterprises were put into operation.
Armenian Economy: Development Prospects
Armenia is currently an industrial-agrarian nation. Small-scale agricultural production is given priority. Agriculture accounts for 31.1% of the nation's GDP, along with industrial production (21.8%), trade (8.7%), new housing construction (8.5%), transportation (5.1%), and other sectors (24.9%).
Manufacturing of building materials, including those based on deposits of tuffs, pearlites, limestones, granites, marbles, foodstuffs, light industries, chemical and petrochemical industries, and nonferrous metallurgy, are the leading industries.
Approximately 44% of all land is used for agriculture. The main crops are melons and watermelons, potatoes, wheat, grapes, fruits, and plants that produce essential oils, tobacco, and sugar beets. Breeding dairy-meat cattle and mountainous sheep is the industry's area of expertise.
The five regions that comprise Armenia's economy each have unique natural, economic, and industrial specializations.
Sevan-Agstevi (electric power, livestock, grains, and tobacco); Ararat (electric power, mechanical engineering, chemical industries, building materials manufacturing, and agriculture); Shirak (textile industry, mechanical engineering, livestock); Pridebed (copper, chemical industries, agriculture, mechanical engineering); and Syuniq (mining industry, agriculture, hydroelectric power industry, and mechanical engineering).
The main industrial center of Armenia is Yerevan, followed by Gyumri and Vanadzor.
Foreign Businesses In Armenia
The speed of the economic reforms and Armenia's safety, freedom, and openness are valued by foreign business owners and investors. Foreign ownership of businesses, properties, or other assets is typically unrestricted. The free return of capital and profits invested is guaranteed by Armenia. Tax breaks and government assistance programs support investment projects.
Micro businesses, IT start-ups, businesses operating in free economic zones, industrial zones, and specific border towns and villages are all eligible for zero-tax status. Other small businesses are only required to pay a sales tax of 1.5–5% if their annual sales are less than about $220,000. Individual capital gains from the sale of securities, properties, or other assets are typically exempt from tax in Armenia. Taxes aren't applied to pension and insurance benefits. On gifts, inheritances, net worth, etc., there are no taxes. There are not many property taxes.
You and your family members may be granted residence status (temporary, permanent, or special) as a result of investing in Armenia. A foreigner may qualify for Armenian citizenship after three years of general naturalization rules.
