Azerbaijan, Baku, May 15 / Trend /
Ellada Khankishiyeva, Director of Trend 's Analytical Center
The Armenian government has already transferred to a so-called "manual management of the economy" for several months, and the decisions are made not based on forecasts, but based on operational data, with the scenario approach. The Armenian government even has an anti-crisis program, which includes three priorities: implementation of large-scale infrastructure projects, support to small and medium business and targeted support to export, import, based on the use of local raw materials for enterprises in Armenia.
But what kinds of local raw materials were described in the last paragraph of anti-crisis program, in fact, Armenia is known to be experiencing difficulties with the export of goods to foreign markets. The reason is the lack of a competitive product that can win the confidence of the international market.
The situation here would seem to save diamond processing industry, which accounts for 35 percent of export. But, again, not its raw materials, but imported. For several time, the system of importing raw diamond to the country was organized well, which passes here the process of cutting (Company Shogakn "), as a result of which the ready products are exported to the European countries.
Diamond raw materials were imported from Israel (45 percent), Belgium (40 percent) and Russia (15 percent). In total, nearly 70 percent of the exports is the export of precious and base metal.
So, the diamond industry in Armenia declined twice. In the first quarter of 2009, the production of the processed diamonds in Armenia decreased by 45.4 percent to $5.5 million as compared to the same period last year. The Ministry of Economy of Armenia connects the drop in the production with the influence of global economic crisis. The whole diamond production in Armenian is exported. Most of the exports account for the United States.
Accordingly, export of processed diamonds decreased during the reporting period by 33.7 percent (the difference between the amount of production and export is that in 2009 stockpiled diamonds were realized, which were produced last year).
With regards to the second well-known brand of export products of Armenia - Armenian cognac - the demand for it in world markets also declined. The Ministry of Agriculture reported that of the total production of the alcohol drinks in Armenia, mostly cognac was exported (90 percent). Now, with the decline in exports, the drop also occurred in production of cognac. During the first quarter of 2009, the production of cognac in Armenia declined 36.8 percent to 2339.4 tys.l. This was noted in the report of the National Statistical Service of Armenia. The export of this drink since the beginning of 2007 has steadily grown. Mostly the Armenian cognac was exported to Russia and Ukraine, where the negative effects of the crisis led to a reduction in consumption.
The precarious situation with the production of these products has led to the issue that the amount of foreign trade turnover of Armenia in the first quarter of 2009 decreased 27.7 percent compared to the same period of 2008 and amounted to $781.9 million.