Armenian Development Agency

INVESTMENT CLIMATE& OPPORTUNITIES

2014

Political Stability

All Political Parties act together toward Economic Development

Public-Private Active Cooperation

Democratic approach to all Challenges in the Country

Government Priority of Private Sector Development

Macroeconomic Stability

GDPby years (percent of growth)

2011 2012

7.2%

4.7%

2.2%

2010

Macroeconomic Stability

INFLATION RATEby years (percent)

2011 2012

2.6%7.7%

8.2%

2010

Macroeconomic Stability

TOTAL FDIs 2012

657 mln USD

• Precious and Semi-Precious Stones

• Foodstuffs• Non-Precious

Metal• Mining

Exports Structure

1428.1 mln USD

Foreign Trade Turnover 2012

Imports Structure4266.8 mln USD

• Precious and Semi-Precious Stones

• Mining • Foodstuffs • Vehicles • Machinery and

Equipment

Exports and Imports Structure of Armenia

• Russia (20%)• EU (39.2%) - Germany - Belgium - Holland

• Bulgaria (9%)• USA (6%)• Iran (8%)

• Georgia (6%)• Canada (6%)

• Switzerland (5%)

Foreign Trade Partners 2012

Main Export Partners Main Import Partners

• Russia (25%)• EU (26.4%)

- Germany - Bulgaria

- Italy - France • China (10%)

• Iran (5%)• Turkey (5%)

• Communication• Power and Gas Supply• Mining Industry• Agro-sector• Beverages • Construction

FDIs Structure of Armenia

FDIs Receiving Major Sectors

Major Investing Countries

• France• Russia• Argentina• Switzerland • Germany

38th Rank INDEX OF ECONOMIC FREEDOM 2013

Rating “Ba2”

Rating “BB-”

Country Ratings According toInternational Assessments

32nd Rank DOING BUSINESS 2013

Country Ratings According toInternational Assessments

In 2012 due to efforts of Armenian government almost in one year our country ranking in ease of doing business was changed from 50th to 32nd

position for 2013.

Armenia is ahead of Belgium, France, Spain, Cyprus, Hungary and Poland.

TRADE MARKETS GATEWAY• MFN regime with 150 countries

(WTO full membership)

• FTA regime with CIS countries (tariff free access to 250 million

consumers’ market)

• GSP regime with USA, Canada, Japan, Norway and Switzerland

• GSP+ with the EU

Rates

VAT– 20 %PROFIT TAX – 20%

No export duty

import tariffs0% Or 10%Simplified taxation

for Small and Medium Entreprises

INCOME TAX – max.26%

TAXATION

High-tech oriented FEZ – on the base of the plant “Mars” and YCRDI

FEZ ORIENTATION• Electronics & Precision Engineering• Alternative Energy• Pharmaceutical industry & Biotechnology• IT & Telecommunication• Industrial Design

The operators of free zones will be granted exemptions from: 

• Profit tax• Corporate income tax• Value added tax  • Property tax• Customs duty 

0%

FREE ECONOMIC ZONES

FEZ for Jewelry Sector Development

FEZ ORIENTATION• Jewelry and watches production• Diamond processing and cutting• Other jewelry goods and accessories production

The operators of free zones will be granted exemptions from: 

• Profit tax• Corporate income tax• Value added tax  • Property tax• Customs duty 

0%

FREE ECONOMIC ZONES

Why Invest In Armenia

NONo Restriction on Foreign Ownership in Companies

NO No Restriction on Capital Movement

NONo Restriction on Foreign Exchange Operations

No No Restriction on Repatriation of Profit

No No Restriction on Foreign Employment

Why Invest In Armenia Well-educated, Cost-efficient

Skilled Labor Workforce

Sustainable Banking System

Possible Customs Union and Free Access to CIS 250

mln Consumers market

WTO Full Member Since 2003

Investment Protection Treaties with 40 Countries & Double

Taxation Treaties with 43 Countries

Simplified Export and Import Regulations

Free Economic Zones

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Why Invest In Armenia

Where Invest in Armenia Jewelry and Diamond Processing

IT and Software Development

Pharmacy Production

Wine and Brandy Production

Tourism and Hotel Construction

Renewable Energy

IT and Software Development

400 Software graduates per annum 2,000 IT related students

65% of students speak English

6,000 IT specialists 15-20% sector annual growth rate

360 companies , including 107 foreign

Renewable Energy

Support from local authorities

Highly trained and skilled workforce

Resource capacity availability

International cooperation in initiatives targeting the field of energy

15 years of obligatory purchasing of RE-based electricity by the state

Feed-in tariffs

Pharmacy Production

Decades - long traditions and rich experience in fine chemical industry

Highly educated workforce

State-of-the-art testing and up-to-date laboratory facilities

Open and collaborative clusters

Strong willingness and readiness of companies to adopt international

standards and to cooperate internationally

High market growth in CIS(Russia's dependence on imports of

pharmaceutical products is 70%)

- Old heritage in Jewelry Industry

 - Solid capacity and tradition of processing and growing synthetics diamond

- Huge pool of qualified and experienced cost efficient jewelers and diamond processors - Huge network of Diaspora in the sector

- Government strong willingness to assist the sector development

- No VAT on imports and sale of gold and precious stones

- No import or export tariff on jewelry

Jewelry and Diamond Processing

AGRICULTURE

No Export Duty

Free Access to CIS and strong demand from the Middle East

Cost-efficient labor workforce

Appropriate climate, clean water and 333 sunny days per year

Tourism & Hotel Construction

Safe destination

Growing demand in hotel construction

More then 5000 historical monuments

E-visa scheme or getting visa at the border

Annual average growth of the number

of incoming tourists is 15-20%

SUCCESS STORIES

• Providing Quality Information - preparation of a tailored information packages corresponding to the needs of foreign investors • Organizing Site Visits- Planning the Site Visit - planning and preparation of visit of foreign investors, arranging necessary appointments with private and public organizations, - Managing the Site Visit, starting from meeting at the airport, translator provision, assisting in site selection, etc. • Brokering Business Partnerships – finding

the appropriate partners in Armenia• Follow Up Support – managing post-visit

support, preparation of additionalinformation and documentation.• Investment Project Implementation –

assisting with company registrationand staff recruitment (job announcements & holding interviews)• Liaising with Government institutions

(ADA) was established by the Government of Armenia to facilitate foreign direct investment and promote exports.

The Prime Minister of Armenia is the chairman of the board. The ADA acts as a "one-stop shop" agency for investors

ARMENIAN DEVELOPMENTAGENCY

WELCOME TO ARMENIA

Armenian Development Agency+374 10 57 01 70info@ada.am www.ada.am