Is there a chance to improve the investment climate in Armenia?
The current feuds in the power circles of Armenia negatively affect the economic performance of the republic. The Pashinyan government is busy retaining power and reformatting the judiciary. So, alas, there is no hope for an improvement in the investment climate in the near future.
Big business eschews Armenia. Especially against the backdrop of the criminal prosecution of companies with foreign capital.
A criminal case on the alienation of state property from the concession assets of South Caucasus Railway CJSC serves as a reason for the suspension of investment. In turn, attempts to attract other finances to create a modern railway in the republic are ineffectual.
The implementation of the North-South Motorway project, which is supposed to connect Iran with Georgia through the territory of Armenia, is much more likely. There are a huge number of pitfalls associated with various corruption schemes. Its full implementation is possible only with the direct participation of the Chinese side with the involvement of the highway project in the Chinese initiative "One belt - one way".
The reduction in foreign direct investment is also due to a rather unpredictable economic policy pursued by the authorities. A necessary condition for overcoming this situation is the search for new models of economic development.
One of the possible options is to build an economy on the principles of increasing state influence in market processes and protectionism.
If we can predict the development of the Armenian economy today, it will, first of all, be observed in the field of information technology (especially taking into account the challenges of digitalization of the educational process and individual economic areas with their transition to digital mode) .
Here Armenia has something to say, including taking into account the competitive price of manufactured products. High-tech sphere has traditionally, since the days of the Soviet Union, been very strongly developed in the republic. Today, information technology is also one of the key areas of the economy. We really have a very large human and intellectual potential, our products and personnel are in demand around the world.
Thus, Pashinyan’s 2019 conviction of "laying a solid foundation for the future" crashed into the reality of the present. By the end of 2020, we can already forecast a decrease in economic growth by 2-2.5%. If you calculate how the suspension of investment flows this year will affect the development of the economy in subsequent years, then the amount will be impressive.