Economy, Domestic Economy

Armenian Ambassador Discusses Ways to Boost Bilateral Trade

Armenian Ambassador Discusses Ways to Boost Bilateral TradeArmenian Ambassador Discusses Ways to Boost Bilateral Trade

Expansion of trade ties with neighboring countries has long been one of the priorities of Trade Promotion Organization of Iran.

The country has fared well in creating trade relations with Iraq and Turkey but has stumbled upon advancing its economic relations with its northern neighbor, Armenia.

In an interview with Donya-e-Eqtesad, the Armenian ambassador to Iran has weighed in on potential avenues to boost trade relations between the two countries.  

Artashes Tumanyan believes that despite favorable political ties between Tehran and Yerevan, mutual economic and trade capacities have yet to be fully exploited.

“In order to improve such relations, a number of joint infrastructure projects are underway, some of which are operational as we speak, including two high-voltage power lines and Iran-Armenia gas pipeline. Also, the two countries have agreed upon the construction of the third energy transfer line between Iran and two hydro-electric power plants on both sides of the Aras River,” he said.

Trade between the two neighbors hovered around $200 million in recent years, which is an insignificant figure given that Armenia’s customs border is open to Iranian goods, according to the envoy.

As a member of World Trade Organization, Armenia levies a minimal customs duty on imported commodities.

“This comes as entry of Armenian goods to Iran is not that easy,” he added, noting that Iran’s “unconventional high tariffs have practically rendered exports to the country impossible.”

This is while Turkish goods are streaming into Iran under a preferential trade agreement.

 “I will float the idea of a same PTA with Armenia in my meetings with Iranian officials,” said the envoy.  

Armenia is a member state of the Eurasian Economic Union along with Kyrgyzstan, Kazakhstan, Belarus and Russia. There is no customs border between these five countries, which translates into free movements of goods, people, services and capital among them. This opens up new horizons for economic relations between Iran and Armenia. Iranian investors in Armenia are now able to move their products throughout the EEU without having to pay customs duties, according to Tumanyan.

 “I need to stress the fact that EEU is a 200-million-strong market,” he noted.

There are two free trade zones in Armenia active in telecommunications, IT, electronics, biotechnology, jewelry and watch-making sectors. Investors in these FTZs are exempt from value added tax, goods and interest tax.

“It is easy to do business there. Establishment of free trade zones in Iran has also opened numerous opportunities for investment by Armenians,” he said.

Tumanyan hoped that the nuclear deal reached between Iran and the West would help the country implement its economic policies and see the investors of other countries move their capital there.

“Armenia is banking on setting up joint ventures with Iran,” he concluded.