Epress.am News from Armenia
The expectations that Armenia’s membership into the Eurasian Economic Union (EEU) would have opened a big market for the country’s exports were groundless; it was only unreal and unsound propaganda, economist Ashot Yeghiazaryan said in an interview with Epress.am.
“EEU member countries are quite similar in economic structure. They export raw materials and have a very primitive structure in terms of production – agricultural produce, its primary reproduction, and in some countries, like Russia and Belarus, there is the production of consumer goods, which is not that difficult. In reality, these countries do not have much to exchange with each other; it’s no coincidence that trade turnover between them is only 8-9%. The rest goes to foreign countries,” the expert said.
Each EEU member, as stated by Yeghiazaryan, wishes its consumer market were a little bit bigger, and in such circumstances it’s natural that the Eurasian Economic Union, first and foremost, should have served Russia’s interests. The country, having been affected by Western sanctions, declared an import substitution policy aiming at self-sufficiency through the replacement of foreign imports with domestic production. “It’s clear that in these circumstances the market would not have opened for Armenia either since Russia’s policy is aimed at encouraging its producers. At the same time, another factor came into light – the market started to decline. Russia’s problems began when hit by sanctions and isolation: oil prices fell, and this country is actually heavily dependent on petrodollars.”
The economist added that because of Russia becoming less solvent, there will no longer be much of a demand for products exported from Armenia. “When we say a 170-million market, we mean the number of the population. When referring to economic performance, it’s important to understand how much Armenian exported products this market is able to consume. In this sense, the market has declined in the past year. Not to mention Armenia’s transportation problems, the fact that the Armenians’ business activities have become risky since the ruble’s devaluation because Russia only signed agreements in rubles.”
All these circumstances, in parallel with the weakening of Russia, caused Armenian exporters to suffer major losses, Yeghiazaryan stated. “It would be untrue to say there were no such cuncerns prior to the EEU agreement. If we had had a more serious, scientific approach, if we had taken into account a number of factors, the changing foreign environment, we would have seen these problems coming,” the expert concluded.