Calm Before the Storm: The Unknown Future of Armenia’s Increasing Tourism

In an October 14 Facebook post, Prime Minister Nikol Pashinyan predicted continued double-digit growth in Armenia’s tourism sector for 2020. He also felt the need to urge locals to “treat tourists well.” While Armenians are known for their unmistakable hospitality, the implications of mass tourism create a domino-effect of pressure, for which they might not be prepared.

“Tourism is changing people’s normal environment. Some [locals] don’t know the sphere, they don’t know how to react in this new reality. They are trying to react according to the cultural norms they are used to,” says freelance tour guide Hasmik Knyazyan. It’s not that locals lack respect—but this small, traditional and isolated country might need a longer adjustment period.

Armenia’s appeal stems from its rustic antiquity and grassroots tourism. However, concerns surrounding untrained local businesses, lack of organized public transportation and simple language or cultural barriers are factors that have been overlooked as the share of tourists who are not diasporan Armenians begins to grow. Susanna Safaryan, chairperson of the State Tourism Committee of the Ministry of Economic Development and Investments, said in an interview that Armenia is now focusing more on the development and regulation of the tourism sector. “Before, we were busy with marketing Armenia mostly,” she says.

According to the Ministry of Economic Development and Investments, 1.6 million people entered Armenia as tourists in 2018. The first half of 2019 already experienced a 12 percent increase from last year, about 770,055 people; 71 percent of them were diasporan Armenians, the trailblazers of Armenian tourism. It was reported that 222,576 tourists stayed in hotel facilities in the first half of 2019, which was a 59.6 percent increase from 2018. Of those, 26.5 percent were Russian, 25.2 percent from Europe and 48.3 percent from other countries. Safaryan expects these numbers to climb in 2020, especially from Europe as Ryanair will be offering low cost direct flights from major population centers like Berlin and Rome. Booking.com has rated Armenia in its top 10 destinations for 2020, and TripAdvisor parades scenic photos and charming local businesses. Armenia is indeed experiencing the calm before the storm.

Armenia’s brand as a tourism destination is partly characterized as being rough around the edges. It lures those looking for something that is quite literally off the beaten path: old roads, abandoned facades and kind locals selling home-made vodka, wine and honey in plastic bottles from the side of winding mountain highways. The hotels and guesthouses run by traditional Armenian families are ready to take you in as their own. Even luxury resorts, spas, wineries and restaurants prescribe themselves as an immersion into Armenian culture. “Tourists who are coming to Armenia are looking for more authentic experiences,” says Safaryan.

She also says that the next few years will be spent improving tourism development. “We will both try to protect the culture, create programs that are economically beneficial to local communities, and will improve the quality of existing offerings,” she says, adding that diversification is necessary, and international chains will begin to show more interest as well. More local restaurants and shops are popping up, more families are opening bed and breakfasts in their homes and listing their properties as available rentals online. Whether through big investments or grassroots business, tourism will generate employment for locals, which is certainly positive. With 2020 just around the corner, these positive developments will be critical and will have to carry the increasingly heavy load.

Yasha Solomonyan is the Executive Director at Tourism Development Projects LLC and the President and CEO of the Armenian Association of Professional Tourist Guides. He agrees that increasing tourist flows generates income and improves quality of life but warns that “such developments also have risks in terms of environmental protection, preservation of monuments, deauthentication and more.” He is urging regulation, education and cooperation between the government and citizens, something which Safaryan says will be addressed.

Along with Armenia’s trademarked authentic and unrefined charm, are still some gaps that need to be addressed. During peak times, Knyazyan says that it is difficult to find space in restaurants outside Yerevan. Staff often only speak Armenian and have not undergone formal customer service training. For those bypassing tour operators, they face taxi drivers who do not speak English, who can drive menacingly through unrenovated roads, and are known for gouging tourists (although this happens in most tourist destinations). “Public transport descriptions are only in Armenian, so people cannot organize their tours by themselves,” says Knyazyan. Moreover, online resources for timetables, routes and ticket information are not user-friendly, when available at all. So far, Armenia seems to have made it work, especially because many tourists choose guides or are Armenians with friends and family who handle much of these hurdles. But as tourism increases, so will the diversification of its demographics.

What’s more, Armenia’s tourism is highly seasonal due to its harsh winters and hot summers. It also faces an ever-present threat of war with Azerbaijan. Knyazyan describes it as “a sphere that can be stopped in one day.” This is why Armenia does not plan to rely on tourism as the basis of its economy, but it remains a priority sector because of its growth potential, according to Safaryan.

Knyazyan also mentions souvenir sellers heckling tourists to buy their products, which she thinks is a reaction to the sudden presence of this newly emerging market. “The areas around monasteries are occupied by local people selling souvenirs,” she says. “They change the atmosphere and authenticity of the place.” Roadside toilets are meager and often squalid, and certain sites do not have sufficient parking areas. The main concern is whether the industry can keep up with its record demand. Locals themselves are not to blame, emphasizes Knyazyan, but this sudden and heightened exposure to foreigners, money and crowds requires an adaptation period.

The government is trying to present solutions. A new strategy for tourism in Armenia will be publicly launched soon, according to Safaryan. “Many activities are in process that we know require our quick attention and reaction,” she explains. “It all comes from the demand. Whatever the tourist is looking for, the supply side is creating opportunities.” She adds that the government is planning to have a global statistics campaign to survey people at entry points to better understand those visiting the country. “We can build our marketing effort to productively target countries,” she says.

According to Safaryan, the government will also begin modifying laws and regulations to protect the industry and meet its current capacity. She says that many of the concerns mentioned by Knyazyan and Solomonyan will be addressed in the future, including environmental protection, archeological preservation and community development. Roads and other infrastructure have begun repairs. Solomonyan notes, “the State also has serious work to do.”

Aside from the government, the Tatev Revival project has implemented educational and cultural programs in the local community of Tatev upon installing the world’s longest cableway—known as the “Wings of Tatev”—which has enjoyed robust revenues. The World Bank plans to initiate programs as well to improve infrastructure and “institutional capacity for increased tourism contribution to the local economy in selected regions of Armenia.” Solomonyan says that preparations are also underway in the public sector: “For example, the Armenian Association of Professional Tourist Guides puts on tour guide courses for beginners and also for more experienced guides.”

Ultimately, tourism is not only diversifying the economy but also society. But this too requires an adaptation period. A study, published by the Private Sector and Development Magazine (PS&D), which evaluates the impact of tourism on developing countries states: “Due to the necessarily asymmetric relations, tourism can create tensions between tourists and populations and can greatly change behavior and local cultural values.” In a country like Armenia, which is over 98 percent ethnically homogenous, the influx of foreigners can spark tension. Knyazyan shares experiences of locals wanting to take photos with people of different races, and that she is approached by beggars only when she is with foreigners. Tourism can also bring an increase in interracial families and openly-homosexual couples for example, groups with whom segments of the population may have had little prior interaction. “They may say these new people are coming and trying to change our culture,” says Knyazyan. The argument remains that the transition period needs some time. Eventually, these diverse influences on Armenia may loosen up its culture, especially for the young generation. “People will get much more open-minded. The other version is that many nationalists will resist this new reality,” adds Knyazyan.

Solomonyan says that he shares many of Knyazyan’s concerns, adding that he has noticed infrastructure and road improvements and is hopeful about what the State plans to do. But he and Knyazyan believe that reform should also come from tour operators. Both mention that current packages tend to offer very similar itineraries. “Tour operators, for example, should actively diversify tour packages, involving lesser-known regions of Armenia. This is important for equitable tourism development in the regions, as well as for avoiding over-tourism,” he says. He suggests that the State invest in these regions as well to reduce the unevenly distributed development which exists in Armenia.

When it comes to international hotel and restaurant chains, Armenia must also tread lightly to avoid falling into a similar trap as other developing tourist destinations. The same study by PS&D also states that, when it comes to foreign investments in developing countries, roughly 55 percent of the income is transferred abroad and leaked out of the host countries: “Local operators have to face tough competition.They consequently see their margins dwindle and their viability jeopardized.” Another necessary evil of increased tourism is the spiking prices of real estate and general cost of living for locals.

“With the increase in tourism, people’s lives are changing for the better… We are trying to make this process participatory,” says Safaryan. Ideally, tourist interest in Armenia will grow in sync with the local grassroots industry to create a harmonious balance in tourism. Until then, Armenia faces an extremely formative but also precarious transition period. As Solomonyan says, “Both the government and the private sector have a lot to do ahead of the 2020 tourist season.”