Armenia Textiles

Sector outlook

Textiles are one of the oldest branches of Armenian economy, and accounted for over one quarter of the total workforce during the Soviet era. Today, Armenian companies specialising in clothing, knitting and textile processing co-operate with European and American partners, while their main export markets remain the CIS states. They have a substantial experience in CM, CMT (cut, make and trim) and full package contracting.

Armenia offers an enormous potential based on:

  • A very competitive workforce: an average monthly wage of USD 200;
  • Industrial areas throughout the country that can be revived.

Textiles are among the 11 strategic export-oriented sectors identified by the industrial strategy (2011) for which a development plan is to be launched.

Strategic direction/ specific schemes and incentives

  • Attraction of FDI to foster technological up-grading, increase in productivity and improvement of marketing and sales techniques;
  • Development of subcontracting: several of the largest Armenian companies work below their installed capacity and are looking for foreign partners;
  • Advantages for investors: exemption of VAT payment for 3 years for the import of new and modern equipment for investments above AMD 300 million (around EUR 585,000).

Business opportunities

In addition to investment/ joint-venture, the main business opportunity is subcontracting in Yerevan and in the regions of Armenia such as Gyumri, Vanadzor and Spitak, where labour costs are even lower and where the workforce is very skilled thanks to long-established traditions.

Export destinations are mainly the USA (no quotas), Russia, EU countries and Canada. Main products:

  • Textiles and clothing (fabrics, knitwear, socks): sub-contracting + design and production of Armenian products and brands;
  • Carpet: one of the fastest-growing sub-sector exports, a tradition dating from pre-Christian times, great demand in Europe, USA and Canada, Middle and Near East;
  • Leather and shoes.

Some success stories

Haniel (Germany), a family-owned group of companies, created a local affiliate in 2007, VKS Armenia, to do business in the country. It has several hundreds of employees in Yerevan and Vanadzor. VKS Armenia inaugurated a new sewing factory in Amasia in 2011.

Several famous companies have inked subcontracting agreements with Armenian companies. One of the recent deals involves La Perla (Italy), a creator of luxurious and fashionable lingerie, nightwear, swimwear, and loungewear for women and men since 1954.

Useful links and contacts

Armenian CCI

Armenian Development Agency (ADA)

SME Development National Center of Armenia

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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