Following the collapse of the Soviet Union, Armenia experienced de-industrialization as factories shut down en masse. In recent years, the country’s leadership has recognized the potential of manufacturing as a means to combat poverty and unemployment.
In this issue, we explore Armenia’s diverse manufacturing industries, from food production to textile manufacturing to diamond processing. We delve into the challenges and opportunities facing each sector, the innovations driving growth, and the impact on Armenia’s economy and society.
The Armenian government aims to increase the production of high value-added goods and improve the economic complexity index (ECI) of Armenia to compete in international markets. Armenia’s economic complexity ranking dropped from 35 to 77 between 2000–2020, which indicates a decrease in the export of ready-made products, machinery, equipment, and technologically complex products. To address this issue, the government plans to upgrade enterprise technology, enter new international markets, and strengthen existing positions to increase economic complexity.
Food and agro-processing in Armenia has a long history and is a crucial branch of its economy. Being a small country, however, Armenia can’t always compete with larger countries, instead, exports should focus on premium-class food products.
Successive Armenian governments have emphasized the importance of the diamond industry as a key branch of the economy. Despite fluctuations and challenges, the industry continues to be well-established in Armenia.
Creating economically complex, high value-added textile products is the key to competitiveness in global markets. However, the added value index of the textile sector in Armenia has decreased over the last three years, indicating a decline in productivity. What is the government doing?
By promoting manufacturing, Armenia can shift its economic reliance away from traditional sectors such as agriculture and mining and move toward value-added activities and create a path toward sustainable economic growth and prosperity.