Tigran Sargsyan, Prime Minister of Armenia
Tigran Sargsyan, Prime Minister of Armenia

Tigran Sargsyan, Prime Minister of Armenia since 2008, discusses the country’s economic-development strategies and decision to join the Customs Union.

European Times: Why did Armenia choose to join the Customs Union with Russia and not the DCFTA with the EU?

Tigran Sargsyan: Armenia made the decision to join the Customs Union with a vision towards sustainable growth boosted by a favourable economic environment and further development of existing economic and humanitarian ties. This decision was also based on the Armenian-Russian strategic partnership, as well as the centuries-long friendship between our nations. Thanks to the free movement of goods and capital in the Customs Union and the Common Economic Area, Armenia will gain wide access to the large CU market. This, by the way, is a traditional market for Armenian goods, which are more compatible with the technical regulations existing there. In addition, we forecast a considerable increase in FDI in Armenia. Located at the crossroads of civilisations, Armenia has the potential to become a good platform for the development of economic ties between CU countries and the Middle East.

European Times: How are you doing to promote rural development?

Tigran Sargsyan: Balanced development is one of our top priorities, for economic and, especially, for political reasons. The concentration of Armenia’s political, social and economic capacities in the capital, Yerevan, impedes the overall balanced development of Armenia and limits Yerevan’s development as well. The government of Armenia approved the Territorial Development Concept in 2011, which was designed in cooperation with the Armenian office of the UNDP. The concept, basically, highlights three major tasks: designing a toolkit to monitor the situation in Armenia’s regions (marzes); determining criteria to evaluate the efficiency of the state’s regional-development policies; and implementing a simulation model to plan medium-term expenditures through the state budget. In our efforts towards sustainable and proportional territorial development, our objective is to increase the quality of life in rural areas to a level more or less commensurate with that of urban areas. Our Gyumri and Vanadzor techno-parks, which will open in 2016, are part of this drive, as are the already functioning financial and educational centre in Dilijan, with its entire supporting infrastructure.

European Times: What are your strategies to ensure sustainable development for Armenia?

Tigran Sargsyan: The primary goal in our current agenda is to diversify the Armenian economy. We continue to see a lot of potential in the ICT sector, and the results we have achieved over the past five years show that we are on the right path. In 2011, the government of Armenia shifted to an export-oriented industrial policy. We have identified 11 sectors of our economy with higher growth potential and we have mapped out a strategy for their long-term development. This strategy focuses mainly on boosting exports to stimulate the production of high-quality goods, expanding into foreign markets, and creating new jobs. This export-oriented industrial policy should enable us to move from a resource-based economy to a knowledge-based one. Armenia’s economic evolution over the past decade shows that the Armenian government has an important role to play in the structural formation of our economy. In this respect, I highly prioritise private-public partnerships as the most efficient means of achieving our economic goals. I am confident that through a joint government and private-sector strategy, we can achieve measurable results and progress. With the national programme that we started to implement two years ago, we are on the way to achieving our priorities concerning government support, proper state monitoring and transparency, all of which will result in a more efficient business environment. Our first step in this direction was the development of a platform for public-private partnerships and the establishment of an industrial development foundation to support businesses. We have also expressed our willingness to discuss and consider prospective investment projects where government support and participation are required. For the first time in the past 23 years, we have allocated funds from the state budget to support industrial development in Armenia.

European Times: Why should international investors choose Armenia?

Tigran Sargsyan: Armenia’s reforms designed to create a better business environment have made Armenia a more attractive investment destination. We have had notable achievements in this respect over the past five years, and this fact has been acknowledged by the World Bank. Armenia was number one among CIS countries and 37th in the world in the World Bank’s “Doing Business” rankings for 2012. The government of Armenia has demonstrated its strong interest in supporting investment projects, granting benefits and investing in infrastructure for large-scale investment projects. We have managed to build a strong reputation for Armenia as a reliable investment destination. The ongoing promotion of investments is one of our key strategies to build a more diverse economy and develop more competitive industries.