Economy - overview Under the old Soviet central planning system, Armenia had developed a modern industrial sector, supplying machine tools, textiles, and other manufactured goods to sister republics in exchange for raw materials and energy. Since the implosion of the USSR in December 1991, Armenia has switched to small-scale agriculture away from the large agroindustrial complexes of the Soviet area. The agricultural sector has long-term needs for more investment and updated technology. The privatization of industry has been at a slower pace, but ahead of most of the rest of the CIS. Armenia is a food importer and its mineral deposits (gold, bauxite) are small. The ongoing conflict with Azerbaijan over the ethnic Armenian-dominated region of Nagorno-Karabakh and the embargoes imposed by Azerbaijan and Turkey contributed to a severe economic decline in the early 1990s. By 1994, however, the Armenian Government had launched an ambitious IMF-sponsored economic program that has resulted in positive growth rates in 1995-97. Armenia also managed to slash inflation and to privatize most small and medium-sized enterprises. The chronic energy shortages Armenia suffered in recent years has been partially offset by the energy supplied by one of its nuclear power plants at Metsamor, which in 1996 supplied about 40% of the country's energy needs, according to the Armenian Government. Moreover, Armenia is expanding its energy imports from Iran.

GDP purchasing power parity - $9.5 billion (1997 est.)

GDP - real growth rate 2.7% (1997 est.)

GDP - per capita purchasing power parity - $2,750 (1997 est.)

GDP - composition by sector
agriculture: 38%
industry: 32%
services: 30% (1996 est.)

Inflation rate - consumer price index 13.2% (1997 est.)

Labor force
total: 1.6 million (1997)
by occupation: manufacturing, mining, and construction 25%, agriculture 38%, services 37%

Unemployment rate 10.6% officially registered unemployed, but large numbers of underemployed (June 1997)

Budget
revenues: $322 million
expenditures: $424 million, including capital expenditures of $80 million (1998 est.)

Industries much of industry is shut down; metal-cutting machine tools, forging-pressing machines, electric motors, tires, knitted wear, hosiery, shoes, silk fabric, washing machines, chemicals, trucks, watches, instruments, microelectronics

Industrial production growth rate 0.7% (1997 est.)

Electricity - capacity 2.768 million kW (1995)

Electricity - production 6.3 billion kWh (1996)

Electricity - consumption per capita 1,570 kWh (1995)

Agriculture - products fruit (especially grapes), vegetables; vineyards near Yerevan are famous for brandy and other liqueurs; minor livestock sector

Exports
total value: $290 million (f.o.b., 1996)
commodities: gold and jewelry, aluminum, transport equipment, electrical equipment, scrap metal
partners: Iran, Russia, Turkmenistan, Georgia

Imports
total value: $727 million (c.i.f., 1996)
commodities: grain, other foods, fuel, other energy
partners: Iran, Russia, Turkmenistan, Georgia, US, EU

Debt - external $820 million (of which $75 million to Russia) (1997 est.)

Economic aid
recipient: ODA, $NA
note: commitments (excluding Russia), $1,385 million ($675 million in disbursements) (1992-95)

Currency 1 dram = 100 luma (introduced new currency in November 1993)

Exchange rates dram per US$1 - 499.89 (November 1997), 414.04 (1996), 405.91 (1995), 288.65 (1994), 9.11 (1993)

Fiscal year calendar year

NOTE: The information regarding Armenia on this page is re-published from the 1998 World Fact Book of the United States Central Intelligence Agency. No claims are made regarding the accuracy of Armenia Economy 1998 information contained here. All suggestions for corrections of any errors about Armenia Economy 1998 should be addressed to the CIA.