Armenian economist on consequences of ban on Armenian-Turkish trade

Economist Vilen Khacharyan, at a meeting with reporters on Monday, spoke of possible the consequences a ban on import of Turkish goods could have for Armenia’s market.

This January-March, Armenia’s exports showed a 126.3% increase, with an 84.1% decline in imports.

“Russia is our number one partner in terms of both exports and imports. With respect to import, Bulgaria and Iraq rank 2nd and 3rd respectively, their share being 10.5%,” Mr Khachatryan said.

As regards imports proper, China is Armenia’s second largest partner, 11.7%, followed by Germany (3rd). Turkey is the fifth largest exporter to Armenia.

Elaborating on Armenia’s trade relations with Turkey, Mr Khachatryan said that 2005 was the best year in terms of export, Armenia’s exports totaling US $2,473,000. Last year’s exports totaled US $1,497,000. This year’s exports have now totaled US $142,000.

As for imports, the economist pointed out to main trends: country of origin and country of trade.

“The best year for imports was 2011 [when we purchased goods] worth $240 million. The imports in 2015 amounted to $137 million; in the [first] three months of 2016, we imported products worth a total of $24 million. If we fully suspend the trade with Turkey, both the importer and the exporter will lose. There is, however, also a third scenario: to partly suspend the trade turnover with Turkey. We can suspend either the import or the export. Should we decide to suspend the import from Turkey, Turkey will suspend the exports. So, the scenario won’t work,” he added.

Asked to comment on possible developments in case of realizing the plan, Khachatryan replied, “What we deal with here is the society’s attitude that by purchasing goods from Turkey we help it supply Azerbaijan with arms etc. It is noteworthy that Turkey’s gross domestic product will make $721 billion in 2017. The 140 million we have today will make 14 million even if we secure 10% profitability; if 30% of it goes to taxes, less than 5 million will go to the Turkey’s budget. Hence, the hypothesis that Turkey can finance Azerbaijan at least a little bit with those means is untrue,” he added.