Armenia Agribusiness

Sector outlook

Armenia offers very good conditions to produce high quality agriproducts, though its resources are limited in terms of land suitable for farming. Agriculture accounts for around 21% of GDP and 9.8% of exports (2011). The main products include cereals, fruits (grapes, figs, pomegranate, apricots...), vegetables and livestock.

Fast growth in the agriculture and food processing industries has led to import substitution by domestic production. Armenia aims at developing subsectors with the most important export potential, especially brandy and wine, fish and crayfish, fruits and vegetables, canned food, water and juices.

Strategic direction/ specific schemes and incentives

  • Attraction of FDI in order to increase the agribusiness sector competiveness: introduction of modern processing and packaging technologies;
  • Development of exports: FEZ to be established in Zvartnots airport for fresh fruit and vegetables;
  • Agribusiness producers are exempted from VAT tax.

Business opportunities

Agriculture and food processing projects with high value added can be developed for the local markets or for exports of high quality products to Russia, the CIS countries and the EU.

Promising sub-sectors:

  • Import substitution: manufacture of new products in Armenia such as dairy products;
  • High value added and quality products: alcoholic beverages (Armenian brandy), fresh fruits, organic products, canned fruits and vegetables, soft drinks, mineral water, fish breeding and meat.

Examples of investment opportunities:

  • Ananukh (Armenia) is looking for investors to launch a closed and open ground export-oriented production project in the Gegharkunik region to grow carnation, tomato, cucumber, pepper, potato and garlic. An investment plan designed by BSC is available, expected FDI ranges from USD 130,000 to USD 2 million.
  • The Armenian Ministry of Economy promotes several investment opportunities such as a caviar production project, to be developed through a joint-venture, with a planned production volume of 20 tons/yr. Estimated FDI: USD 5 million.

Some success stories

Pernod Ricard (France), a world co-leader in wines and spirits, acquired the famous Ararat Brandy company in 1999, and established a distribution affiliate for Armenia in 2008.

Spayka (Russia), a regional leader in infrastructure in the fields of transportation and agriculture, created a freight affiliate in Armenia in 2011 and established its own warehouse and cooling unit and transportation system to export products in Russia and other CIS countries under the new brands “Araratfood” and “Araratfruit”.

This publication has been produced with the financial assistance of the European Union. The contents of this publication are the sole responsibility of EUROCHAMBRES and can in no way be taken to reflect the views of the European Union.

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