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Armenia losing all chances to attract investments

23 April 2015 14:50 (UTC+04:00)
Armenia losing all chances to attract investments

By Mushvig Mehdiyev

The unpleasant outcomes of Armenia's integration into the Eurasian Economic Union are obviously seen in the field of investments - the country has already lost its attractiveness when it comes to foreign businesses.

Local media, including the Irates de facto newspaper believes that if there were some hopes to launch a business activity in country during the pre-EEU period, now all hopes have been dashed.

The paper claims that entrepreneurs in Russia viewed Armenia as a door to Europe in the light of their business expansion. But since the country joined the EEU, its initial European appeal lost its bite, leaving entrepreneurs to look elsewhere for opportunities.

The newspaper has come with an interesting fact to substantiate its claims - a famous Russian tycoon recently chose to invest in Georgia over Armenia.

"One of the well-known entrepreneurs in Russia wanted to place huge money in Armenia's economy before the country entered the EEU. But, when it was clear that Armenia would indeed enter into the EEU, he moved his multimillion investment projects to Georgia," Irates de facto reported.

Exposing last year's investment trend, Armenia's National Statistics Service reported a significant drop in the amount of foreign investments placed in the country in 2014.

The statistical data showed that about $116.5 million has been invested in Armenia in the first six months of 2014 compared to $293.1 million in the same period in 2013.

Economic and political circles in the country believe that the fall of investments in the economy is not a problem coming from technical issues or a lack of qualified managers but rather the government's reluctance to provide entrepreneurs the necessary security and favorable conditions.

The 2014 Index of Economic Freedom, an annual guide published by The Wall Street Journal and Washington's famous think tank, The Heritage Foundation, reported that Armenia is a moderately free country in terms of freedom in the fields of investment, business, trade, finance and government spending.

Bureaucratic barriers and non-transparent regulations alongside an unequal attitude towards businesses have harmed investments' inflow to Armenia, claimed the report.

The Global Competitiveness Report 2014-2015 of the World Economic Forum said a lack of progress in many fields in Armenia has discouraged investors.

Armenia ranks 121st in view of the procurement of advanced technologies and 100th for its innovation potential, further proof of its poor investment atmosphere.

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Follow Mushvig Mehdiyev on Twitter: @Mushviggo

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