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U.S. embassy exposes truth about Armenia's investment environment

31 January 2018 15:50 (UTC+04:00)
U.S. embassy exposes truth about Armenia's investment environment

By Rashid Shirinov

The U.S. Embassy in Armenia has recently published a report on the investment environment in Armenia in 2017. Now it seems that after getting familiar with this report, serious investors will forever delete Armenia from their list of countries attractive for investment.

Armenian media write that the report, in fact, accuses the authorities of Armenia, of contributing to the monopolization of the economy.

“The main segments of the Armenian economy are controlled by interrelated businessmen, who enjoy patronage of the authorities and have dominant positions in the market,” the report reads.

Thus, the U.S. embassy, ​​in fact, notes that there is an oligopoly system, a dangerous coalescence of the power and the capital in Armenia, which undermines the competitive environment in the country.

Moreover, potential investors cannot rely on the courts of Armenia, since the U.S. embassy’s report notes that the country’s judicial system is not independent, which makes it unreliable in terms of resolving disputes.

Corruption remains the main problem of the Armenian business environment, and the published report shows that the U.S. embassy does not feel any confidence in the Armenian government’s anti-corruption policy.

“Corruption remains a serious problem in such important fields as the judicial, tax and customs spheres, as well as in the fields of health, education, military and law enforcement,” the document reads.

The U.S. Embassy in particular noted the isolation of Armenia as a result of the closed borders with Azerbaijan and Turkey. Many international experts have long noted this factor, which cut off the country from a number of regional projects and lead it into an economic deadlock due to Armenia’s ungrounded illegal claims to its neighbors.

Another noteworthy fact about Armenia is that doing business through the shadow economy is quite common there. Small and medium businesses in the country are being eradicated by high taxes or bribery. Industrial enterprises have long ago turned into the victims of corruption, while the survivor ones are in the hands of oligarchs.

Given the above facts, which were confirmed by the U.S. embassy, it appears that the volume of investment in Armenia's collapsed economy will decrease even more in the near future.

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Rashid Shirinov is AzerNews’ staff journalist, follow him on Twitter: @RashidShirinov

Follow us on Twitter @AzerNewsAz

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