Tuesday, January 19 2021 15:33
Karina Melikyan

The inflow of foreign investments into the Armenian economy has  dropped significantly

The inflow of foreign investments into the Armenian economy has  dropped significantly

ArmInfo. The volume of total foreign investment (all types and forms of investment - ed. note) in the real sector of the Armenian economy in January-September 2020  compared to the same period of 2019 decreased by 32% (against 27.1%  growth a year earlier), amounting to $ 1.5 billion in 9 months of  2020.

The share of FDI in total foreign investment in  January-September 2020 accounted for 25% (against 21% a year earlier)  or $ 363 million, which is 20% lower than the indicator for the same  period of 2019 (against 17.4% growth a year earlier). This is  evidenced by the data of the RA Statistical Committee.

It should be noted that the RA Statistical Committee publishes data  on foreign investments once a quarter, indicating them in AMD  equivalent and in the form of gross flow - the accumulated volume  (without redemption) from 1988 to the reporting date, in this case to  September 30, 2020. To prepare this material, ArmInfo specialists  independently calculated the annual volumes, taking as a basis the  statistics of the gross flow in the corresponding periods of 2020 and  2019 (Estimated exchange rate of dram as of September 30, 2020 was  488.41 AMD / $ 1). Such statistics do not give real figures for  investment receipts for a specific period of time, but they show the  general dynamics and trend.

According to statistics, the TOP-3 countries by the volume of total  foreign investments have not changed.  Thus, Russia holds the lead in  January-September 2020, both in terms of total investment volume - $  519.3 million (with a y-o-y decline of 31%, against 29.1% growth a  year earlier), and in terms of FDI volume - $ 261 million (with a  y-o-y decline of 7% against 21.4% growth a year earlier). Germany  ranks second in terms of total investment - $ 491.1 million (with a  y-o-y growth of 5.6%, against 8.5% growth a year earlier), of which $  20.7 million is FDI (with a y-o-y decline of 25.7%, against a 29%  decline a year earlier). And the top three is closed by Cyprus, from  where the total volume of investments jumped by 72.4% per annum - to  $ 101.2 million, with a meager growth of 1.1% in FDI - to $ 27.8  million, while a year earlier the decline in total volume by 12% was  accompanied by a growth of FDI by 43.7%.

In the volume of total foreign investment, Russia accounted for 35.6%  in 9 months of 2020, Germany - 33.6%, Cyprus - 6.9%, and in the total  FDI volume, the share of these countries is 72%, 5.7% and 7.7%. A  year earlier, for 9 months of 2019, Russia accounted for 35.1% of  total foreign investment, Germany - 21.7%, Cyprus - 2.7%, and the  share of these countries in total FDI amounted to 62.8%, 6.2% and  6.2%, respectively.  It is noteworthy that in the mining industry,  where the lion's share of investments comes from the offshore zone of  Jersey, after a two-year absence of injections (since April 2018), in  the Q2, 2020, an inflow of 3.2 billion drams ($ 6.6 million) was  noticed, which increased the total volume of FDI from Jersey up to  141.9 billion drams ($ 290.5 million - gross flow for 1988-2020), but  in the Q3 there were no infusions. The previous inflow of investments  from Jersey took place in the Q1 of 2018 in the amount of about $ 43  million, and after that 2 years there were no inflows, which, in all  likelihood, was due to the actual suspension of the Amulsar program  (due to the obstacles to the work of Lydian Armenia as a result of  revealing so called  "new environmental factors" called - ed. note).

To recall, in 2019, the volume of total foreign investments in the  real sector of the Armenian economy grew by 17.7%, amounting to $  2.97 billion, while a year earlier the growth was more modest - 7.9%.  In their structure, the volume of FDI decreased in 2019 by 2.5%,  amounting to $ 592 million, against a more significant decline of  11.2% in 2018. The share of FDI in total foreign investment continued  to decline: in 2019 - 20%, against 24.1% in 2018, 29.3% in 2017 and  35.2% in 2016. In country terms, Russia holds the lead in terms of  total investment and FDI - in 2019 $ 1.02 billion (with a slowdown  y-o-y growth from 23.5% to 3.4%), incl. FDI - $ 386.1 million (with a  deterioration in annual dynamics from 31.7% growth to 8.4% decline).  Germany took the second position - $ 684.6 million (with a slowdown  in y-o-y growth from 54.9% to 16.1%), of which $ 20.7 million is FDI  (with a reversal of y-o-y dynamics from 41.6% growth to 51.5%  decline). The TOP-3, as before, is closed by Cyprus, from where  investments in the total volume of $ 75.7 million came in 2019 (with  a slowdown in the y-o-y decline from 71.5% to 12.7%), of which FDI -  $ 26.2 million (with a slowdown in y-o-y growth from 48,7% to 15.1%).  In 2018, Russia accounted for 34.3% of total foreign investment,  Germany 23.1%, Cyprus 2.6%, and these countries accounted for 65.2%,  3.5%, and 4.4%. 

POST A COMMENT
Input digits     


News
We are going round in circles: Aram Kocharyan on  current IT  situation in ArmeniaWe are going round in circles: Aram Kocharyan on  current IT  situation in Armenia
Net direct foreign investments in Armenia`s economy up Net direct foreign investments in Armenia`s economy up 
RA president signs laws nationalizing ENA CJSCRA president signs laws nationalizing ENA CJSC
Responsible innovations instead of offshores - CB Responsible innovations instead of offshores - CB 
Armenia, Uruguay to increase bilateral trade turnover Armenia, Uruguay to increase bilateral trade turnover 
Armenian vice-premier takes part in EEC Council`s meeting Armenian vice-premier takes part in EEC Council`s meeting 
Yerevan to host Black Sea Trade and Development Bank`s Annual Meeting  Yerevan to host Black Sea Trade and Development Bank`s Annual Meeting  
Solid Municipal Waste Management project launched in HrazdanSolid Municipal Waste Management project launched in Hrazdan
Armenian IT sector`s output developed as compared with other regional states - expert Armenian IT sector`s output developed as compared with other regional states - expert 
Lawyer on `legal terror` surrounding ENA Lawyer on `legal terror` surrounding ENA 
AraratBank participated in the WEPs regional experience-sharing workshopAraratBank participated in the WEPs regional experience-sharing workshop
1,507 trucks with apricots leave for Russia since beginning of summer 1,507 trucks with apricots leave for Russia since beginning of summer 
TechWeek transforms Vanadzor into an innovation hubTechWeek transforms Vanadzor into an innovation hub
In Q1 2025, unemployment rate in Armenia decreased to 13.9%In Q1 2025, unemployment rate in Armenia decreased to 13.9%
Moody`s upgrades Converse Bank`s ratingsMoody`s upgrades Converse Bank`s ratings
Armenia`s industrial sector is experiencing a significant  declineArmenia`s industrial sector is experiencing a significant  decline
Power generation in Armenia increased by 3.6% in a yearPower generation in Armenia increased by 3.6% in a year
Armenia`s State Revenue Committee proposes postponing payment of  road, environmental taxes, entry duties Armenia`s State Revenue Committee proposes postponing payment of  road, environmental taxes, entry duties 
46 trucks with Armenian brandy enter Russia 46 trucks with Armenian brandy enter Russia 
Expert: Armenia has every chance to become a key regional  hub for  innovative solutionsExpert: Armenia has every chance to become a key regional  hub for  innovative solutions
IDBank issues the 3rd, 4th and 5th tranches of bonds of 2025IDBank issues the 3rd, 4th and 5th tranches of bonds of 2025
ARMSWISSBANK Launches Mastercard World – A New Premium CardARMSWISSBANK Launches Mastercard World – A New Premium Card
Ministry of Economy: Compared to 2018, job numbers in Armenia  increased by 33.9%Ministry of Economy: Compared to 2018, job numbers in Armenia  increased by 33.9%
Illegal mining in Armenia`s Syunik causes AMD 63mln damage to public Illegal mining in Armenia`s Syunik causes AMD 63mln damage to public 
Rospotrebnadzor requested additional information from competent  authorities in Armenia regarding the reason for the ban of Eskimo ice  cream Rospotrebnadzor requested additional information from competent  authorities in Armenia regarding the reason for the ban of Eskimo ice  cream 
Pashinyan discusses steps for establishing a major AI data center in  ArmeniaPashinyan discusses steps for establishing a major AI data center in  Armenia
In June,  Armenia`s annual inflation rate increased to 3.9%  driven  by higher prices for food  and servicesIn June,  Armenia`s annual inflation rate increased to 3.9%  driven  by higher prices for food  and services
Armenian products to enter Cyprus and US markets: CIBRS announces National Warehouse program strategyArmenian products to enter Cyprus and US markets: CIBRS announces National Warehouse program strategy
European Investment Bank remains Armenia`s key partner in  infrastructure projects - MinisterEuropean Investment Bank remains Armenia`s key partner in  infrastructure projects - Minister
Armenian Parliament gives  Armenian Parliament gives  "green light" to nationalization of ENA
Armenia`s dividends from ZCMC $113mln since 2022Armenia`s dividends from ZCMC $113mln since 2022
Ardshinbank summed up the raffle organized for Mastercard Business cardholdersArdshinbank summed up the raffle organized for Mastercard Business cardholders
Armenia extends ban on export of scrap metal until Feb. 1 2026 Armenia extends ban on export of scrap metal until Feb. 1 2026 
62 trucks with Armenian brandy cross Russian border 62 trucks with Armenian brandy cross Russian border 
Armenia to fix tariff quota on individual types of goods imported  from Iran Armenia to fix tariff quota on individual types of goods imported  from Iran 
Narek Karapetyan: Almost all infrastructure companies, except for  ENA, have increased their tariffs for servicesNarek Karapetyan: Almost all infrastructure companies, except for  ENA, have increased their tariffs for services
EIB: Education is one of key areas of partnership between EU-Armenia EIB: Education is one of key areas of partnership between EU-Armenia 
Armenian Deputy Foreign Minister participates in  4th International  Conference on Financing for Development in SevilleArmenian Deputy Foreign Minister participates in  4th International  Conference on Financing for Development in Seville
Armenian Prime Minister, President of  Trafigura Group discuss  potential  cooperation  in mining sector  Armenian Prime Minister, President of  Trafigura Group discuss  potential  cooperation  in mining sector  
ADB to provide Armenia with EUR236 million for construction of  Sisian-Kajaran roadADB to provide Armenia with EUR236 million for construction of  Sisian-Kajaran road
Vassilis Maragos: EU willing to strengthen technological cooperation with Armenia through concrete stepsVassilis Maragos: EU willing to strengthen technological cooperation with Armenia through concrete steps
Ardshinbank at the Forefront of Digital Security: Sponsor and Participant of BugBounty 2025 EventArdshinbank at the Forefront of Digital Security: Sponsor and Participant of BugBounty 2025 Event
Armenia`s regulator  approved the sale of 100% of GNC-ALFA s shares  to Viva Armenia CJSCArmenia`s regulator  approved the sale of 100% of GNC-ALFA s shares  to Viva Armenia CJSC
 International Chamber of Commerce ready to assist Armenia in hosting COP-17 International Chamber of Commerce ready to assist Armenia in hosting COP-17
Armenia to extend ban on ferrous metal exportsArmenia to extend ban on ferrous metal exports
IDBank Opens a New Branch at Homplex MallIDBank Opens a New Branch at Homplex Mall
MONEYVAL experts to visit Armenia in September to assess work on money laundering control MONEYVAL experts to visit Armenia in September to assess work on money laundering control 
Goods traceability to be improved in Armenia Goods traceability to be improved in Armenia 
Vaharshapan and Khoi communities to be merged Vaharshapan and Khoi communities to be merged 
Armenian NA OKs ENA nationalization Armenian NA OKs ENA nationalization 
Viva celebrates 20th anniversary: Armenia`s high-tech industry  minister on reforms in Armenia`s telecommunication industry Viva celebrates 20th anniversary: Armenia`s high-tech industry  minister on reforms in Armenia`s telecommunication industry 
Economic diversification meets Armenia`s interests - Kaja Kallas Economic diversification meets Armenia`s interests - Kaja Kallas 
5.1% increase in number of jobs in Armenia 5.1% increase in number of jobs in Armenia 
AraratBank: Special Rate for SWIFT Transfers up to EUR 20,000AraratBank: Special Rate for SWIFT Transfers up to EUR 20,000
Team Telecom Armenia, Team Systems under one roof: new Team Place  smart solutions center  openedTeam Telecom Armenia, Team Systems under one roof: new Team Place  smart solutions center  opened
Armenian Parliament discussing  nationalization of Electric Networks  of Armenia CJSCArmenian Parliament discussing  nationalization of Electric Networks  of Armenia CJSC
Armenia values development of  cooperation with Denmark in  high  technology and renewable energyArmenia values development of  cooperation with Denmark in  high  technology and renewable energy
ArmSwissBank: First in Armenia to Publish a Climate Transition PlanArmSwissBank: First in Armenia to Publish a Climate Transition Plan
Ucom Launches 5G Network in Abovyan and EjmiatsinUcom Launches 5G Network in Abovyan and Ejmiatsin
Armenia`s government to be entitled to approve new vehicle purchase support programmesArmenia`s government to be entitled to approve new vehicle purchase support programmes
Read more
Exchange rates
09.07.2025
RUB4.910.01
USD383.82-0.37
EUR449.11-1.47
GBP521.34-0.31
CAD280.24-1.11
JPY26.18-0.06
CNY53.46-0.08
CHF482.060.44