Expert: When there is no trust between private and public sectors,  unfortunately, there is no need to talk about right decisions

ArmInfo. I do not share the optimism that Armenia will be able to diversify its export markets in  a few years; maybe it will be possible to somewhat reduce its dependence on the Russian market.  Emil Stepanyan, co-founder of the Export Armenia Association of Experts stated  in a conversation with  an ArmInfo correspondent.

Noting that the main market for the sale of fresh agricultural  products is the EAEU, especially Russia, where agricultural products  made in Armenia are well known, the expert recalled that economics is  closely connected with politics. "And in this regard, the prospects  are not very good; the political situation, one might say, is tense.  And this also affects the level of optimism among agricultural  investors," Stepanyan noted.

In response to the question, "if not Russia, which destinations can  be beneficial for Armenian agricultural products", the expert  emphasized that it is difficult for our producers to be competitive  in other markets, because other southern countries, especially large  ones, do not have high production costs, unlike from U.S.  "That's  why it's difficult for us to compete. We most likely need to defend  ourselves in this regard and create conditions for development. In  addition, logistics has a very strong influence," Stepanyan noted.   The expert emphasized that, in fact, there are very few alternatives  to the Russian market. Arab countries can serve as a good export  destination, but even there you need to find your niches. For  example, as the expert noted, these could be certified eco-products.

"We need to maintain a balance in this sense. Follow the example of  Georgia, which is now already maintaining a balance by not including  Russia in the sanctions lists, as a market. Georgians have been  trying to diversify export directions, including agricultural  products, since 2008. But when we look at the statistical data of the  EAEU, the level of concentration of Georgia is the same as that of  Armenia. And I think this is a failure of the diversification policy.  And we should very carefully study the Georgian example, which,  unfortunately, does not inspire optimism, so as not to repeat  mistakes. In this sense, the government should communicate more with  exporters," a representative of the Association said.  At the same  time, Stepanyan noted that there is some kind of dialogue between the  private and public sectors, but it is still difficult to say that the  authorities really listen to the opinions of manufacturers and  exporters.

"The level of trust of the state in business, and especially business  in the state, can be said to be not at a high level. And therefore,  when there is no absolute or at least sufficient trust,  unfortunately, it is not possible to talk about productive dialogue  and correct decisions based on this dialogue," he concluded.   Notably, Russia continues to hold the leadership in Armenia's foreign  trade turnover in general, and in exports and imports in particular.  In particular, the foreign trade turnover between Russia and Armenia  at the end of 2023 exceeded $7.3 billion, with a slowdown in y-o-y  growth from 91.7% to 43.3%, conditioned by  a strong slowdown in  export growth. Thus, the export of goods from Armenia to Russia  significantly slowed down the y-o-y growth from 2.9-fold to 38.8%,  with a slight acceleration in the increasing rate of import of goods  from Russia to Armenia from 46.9% to 47.4%, ensuring volumes of $3.4  billion and $3.9 billion, respectively. The share of Russia in the  foreign trade turnover of Armenia decreased slightly year- on-year -  from 35.9% to 35.3%, against the background of a decline in the share  in exports from 45.4% to 40.6% with an increase in the share in  imports from 30% to 31.6%.