Armenia trying to take advantage of Russian embargo on European goods

By: Sara Rajabova

Armenia is desperately looking for a new way out of the current economic crisis.

To this end, it strives to take advantage of Moscow’s decision to put an embargo on European goods’ export to Russia.

Armenian Prime Minister Ovik Abramyan recently said Russian embargo on European goods gives Armenia an opportunity to increase its export to Russia.

“This is a very good opportunity. We can take this chance to pave the way for more production,” he said.

As an example, he said today Armenia can produce and export 4,000 tons of commodities. The statement comes as the country is currently producing only 1,500 tons of commodities. “We can produce and export further 2,500 tons of commodities,” Abramyan believes.

He intends to increase the production of commodity twice, which doesn’t seem real for Armenia in the near future while the country tackles with economic problems.

Some Armenian economists also see the Russian embargo on European goods as a good chance for Armenia. Now the question is whether or not Armenia is ready for a large-scale export to Russia?

Armenia is fearful of taking part in competition with bigger economies in Russian, as well as the Eurasian Economic Union’s markets.

Armenian economist Vardan Bostanjyan said Armenia will have to compete with the largest countries producing agricultural commodities in the Eurasian Economic Union’s market.

Referring to Turkey and the Latin American states as the largest producers and exporters in the Russian market, Bostanjyan said Armenia will have to strengthen its farm enterprises to reduce the cost and increase the competitiveness of the local fruit and vegetable industry.

He said retaliatory sanctions on Moscow is a good opportunity for Armenia, however, it needs to increase its production capacity to compete in the Russian market.

He noted that the main problem is that most of Armenia’s 340,000 farm families are forced to live in subsistence farming and sell only the surplus of their harvest.

Bostanjyan added that the harvest of Armenians is still considered a commodity.