Geographical issues in Armenia

Armenia is a landlocked country in the South Caucasus. The country is bordered on the north by Georgia and Iran to the south; Azerbaijan and Republic of Artsakh in the east, Turkey in the west.

A 1994 map of the Caucasus region, including the locations of valuable resources shared by the many states in the area: alunite, gold, chromium, copper, iron ore, mercury, manganese, molybdenum, lead, tungsten, zinc, oil, natural gas, and coal.

Economic conditions in Armenia

Located in the Caucasus region between Asia and Europe, Armenia has a highly educated workforce and the Government of Armenia (GOA) officially welcomes foreign investment.[1]

With a population of approximately 3 million, Armenia has a relatively small domestic market.[2] Armenia's accession to Eurasian Economic Union opened markets of large countries like Russia and Kazakhstan for Armenian products.

Various issues typical for a developing economy are exacerbated by Armenia's poor geographic location and by opngoing blockade through Turkey and Azerbaijan.[3]

High transportation cost

As a landlocked country with no direct access to main shipping routes, Armenia must trade across borders to reach major world markets in North America and Europe in order to maintain sustainable economic growth and development. Cross-border trading, however, incurs higher transaction costs and reduces competitiveness and trade volume.[4] In Armenia, poor existing physical infrastructure such as roads and railways compounds this problem by further raising the risk and cost of transport. Much of Armenia's infrastructure was built during the Soviet period and is in need of repair and renovation.[5]

Vulnerabilities to external shocks

Most landlocked countries are vulnerable to external shocks due to their dependence on neighboring countries and Armenia is no exception.[6] Poor ties with Turkey and Azerbaijan only serve to strengthen Armenia's dependence on Georgia and Russia. It imports nearly all of its refined petroleum products through Georgia and most of its energy fuel from Russia. The 2008 South Ossetia War between Russia and Georgia resulted in disruption to fuel and food imports.[7]

See also

References

  1. ↑ "Investment Climate Statements for 2017". www.state.gov. Retrieved 2018-02-17.
  2. ↑ "Background note: Armenia". US Department of State. 2011.
  3. ↑ "Nagomo-Karabakh: The Crisis in the Caucasus". Lionel Beehner. 2005.
  4. ↑ "Landlocked Developing Countries". UN-OHRLLS. 2005.
  5. ↑ "Armenia - Infrastructure, power and communications". Encyclopedia of the nations. 2011.
  6. ↑ United Nations (23 March 2010). "Groups of countries in special situations" (pdf). United Nations. Retrieved 13 September 2011.
  7. ↑ "Background note: Armenia". US Department of State. 2011.
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