AGP Executive Report

EU Trade: Temporary preferences taking effect October 10 will liberalize nearly 80% of Armenian exports to the EU for two years, including most fresh produce and more than 91% of beverage and spirits exports. Agricultural Exports: Regular cargo flights to the UAE are due to start in November, carrying about 20 tonnes per flight at a quoted rate of $2.20 per kilogram. Tourism: A Luys Foundation review says Armenia fell to 72nd of 110 countries in the World Economic Forum’s 2026 tourism index, eight places below its 2019 ranking, despite rising visitor numbers. Energy and Investment: At a meeting in Turkmenistan, Armenia’s and Iran’s leaders pledged to deepen ties; Pashinyan said Iranian firms are involved in strategic projects in Armenia. Separately, Russian officials’ warnings about power demand from a planned AI data center underscore energy supply as a key constraint on technology investment.

Energy and AI: Russia’s Security Council warned that the planned expansion of Firebird AI’s data centre in Hrazdan could strain Armenia’s electricity supply. The company is targeting 300 MW of capacity by the end of 2027. Regional Trade: Prime Minister Nikol Pashinyan said Azerbaijani railways are already carrying cargo to Armenia, while the TRIPP project is expected to establish direct rail links between the countries. Export Markets: Armenia and France discussed opening more opportunities for Armenian products in the French market, as Yerevan seeks to diversify exports. Iran Ties: Armenian and Iranian officials agreed on a timetable to fully launch electronic preliminary customs-data exchanges, aimed at smoothing cross-border trade. European Trade: Armenian exports to the EU have risen nearly 70%, and the EU has approved temporary trade privileges for Armenian goods.

Regional Energy Links: Armenian and Azerbaijani officials held technical talks on power lines under the TRIPP project. Armenia is also discussing two-way electricity trade with Turkey through the Gyumri–Kars connection. Trade and Investment: Armenia and Belgium explored stronger business ties, while the EU’s share of Armenia’s foreign trade rose to 19% in January–August, from 12.3% a year earlier; trade with the bloc grew 53.9% to more than $2.4 billion. Exports: Armenia presented its first national pavilion at Madrid’s Fruit Attraction exhibition, where five local companies sought partners and new markets. Transport: The government approved 8.9 billion drams for medium-term repairs to 176 kilometers of roads. Pashinyan also plans talks with Russian Railways on restoring rail links toward Turkey and Nakhchivan. Energy: Rosatom and Armenian specialists confirmed the nuclear plant’s safe operation through 2031 and agreed on upgrades aimed at extending operations to 2036.

Tech: Picsart, founded by Armenian entrepreneurs, ranked among the world’s top 10 mobile AI apps, strengthening Armenia’s profile in the fast-growing sector. Energy and Investment: Armenia is reviewing nuclear plant proposals from Russia and other countries, with a model decision expected in 2027. Prime Minister Nikol Pashinyan says Amazon is interested in investing if Armenia can guarantee reliable power from a roughly 1,000-megawatt facility. Agriculture: The government plans to limit its subsidized agri-food loan program to 2026; nearly 24,730 loans worth about AMD 44 billion had been issued by August 31. Foreign Capital: Net foreign investment in Armenia tripled year-on-year to $395 million in the first half of 2026. The French Development Agency is also set to provide two loans totaling €270 million. Trade and Industry: Exports of Armenian-origin products to the EU rose almost 70%, while Carlsberg agreed to acquire PepsiCo bottling operations in Armenia and Georgia.

Investment: Net foreign investment tripled year on year to $395 million in the first half of 2026, including $309 million in foreign direct investment. The UAE and Russia accounted for much of the rebound, with investment concentrated in mining. Public Finance: France’s development agency signed agreements for €273 million in loans, including €250 million for government reforms and €23 million for housing vulnerable families. Business: Carlsberg plans to acquire PepsiCo’s Armenian bottler, extending its South Caucasus partnership; the deal requires government approval. Energy: Rosatom and Armenian nuclear plant representatives confirmed Unit 2’s safe operation through 2031, with upgrades planned to support operations through 2036. Tourism: Armenia welcomed 290,016 visitors in September, up 27% from a year earlier and the highest monthly total so far this year. Technology: The World Bank says AI and digital infrastructure are drawing investment, but Armenian tech firms still rarely sell AI solutions to local businesses.

World Bank & public finance: Deputy PM Mher Grigoryan met World Bank Regional Director Roland Preiss, reviewing progress on Armenia programs worth about $818m in grants and loans, spanning energy, water, healthcare, public system modernization and tourism. Budget planning: Parliament will start 2027 state budget talks on Nov 2; the draft targets 5.8% growth, 3% inflation (±1.5%), revenues of AMD 3.604trn and a deficit of AMD 468.2bn. TRIPP & connectivity: Pashinyan framed TRIPP as a peace-driven economic transformation, while Russian officials questioned “Trump Route” targets and timelines; Armenia also discussed TRIPP progress with Iran’s leadership. Business forums: Armenia hosted the Armenian-British Business Forum in Yerevan, with PM Pashinyan linking government priorities to concrete deals. Housing affordability: Artsakh Ombudsman says 82% of regional housing listings exceed the state program’s financial capacity for displaced Artsakh residents. Energy & infrastructure: Armenia and Turkey discussed restoring the Gyumri–Kars power line; separate reports note asphalt paving delays tied to bitumen supply. Finance & real estate: Sergey Babin was appointed CEO of Russia’s VTB-linked M2 real estate ecosystem, boosting PropTech services across mortgage and non-mortgage markets.

Church-State Clash: Armenia’s parliament backed an 11-member investigative commission into the Armenian Apostolic Church crisis, while the opposition said it will boycott; the dispute follows a PM-commissioned report alleging governance, financial opacity and “seizure” of the Church, escalating legal and institutional questions. Regional Connectivity & Trade: At the Armenia-UK Business Forum, PM Pashinyan pitched the “Crossroads of Peace” strategy and TRIPP as a transit and investment engine, linking it to expected Armenia-Turkey border opening and restored rail links with Azerbaijan. Energy Diplomacy: Armenia and Turkey discussed restoring and commissioning the Gyumri–Kars power transmission line, aiming to interconnect grids as normalization talks continue. Finance & Development: World Bank programs in Armenia were reviewed by Deputy PM Mher Grigoryan, with about $818m in active loans and grants across energy, water, healthcare and modernization. Tech & Telecom: PSRC met Huawei on 6G prospects, while Armenia’s Central Bank unveiled a Climate Risk Map with ADB to help financial institutions price climate exposure. Environment & COP17: Armenia unveiled a recycled-silver COP17 commemorative coin as preparations for the Oct 18–30 biodiversity summit in Yerevan continue. Banking Offers: AraratBank launched a business loan campaign with a 9.9% first-year rate (grace periods up to 24 months).

AI & Tech: Armenia’s High-Tech Industry Minister Davit Tadevosyan met Cerebras’ representative to discuss AI infrastructure, high-performance computing, and cooperation with international tech firms. Banking & Payments: Uralsib Bank launched international acquiring for foreign legal entities, letting non-resident firms accept payments with Russian bank cards and receive refunds to their Uralsib accounts, including for Armenian-linked merchants. Trade & Industry: Carlsberg will expand its PepsiCo bottling partnership into Georgia and Armenia via acquisitions, creating a larger South Caucasus beverage platform (Armenian deal pending regulatory approval). Armenia-Iran Connectivity: Foreign Minister Ararat Mirzoyan held high-level talks in Tehran on energy, transport, border unblocking and TRIPP implementation, while officials also discussed easing Nordooz bottlenecks for freight and customs clearance. Regional Policy & Risk: Russian Security Council Deputy Chairman Dmitry Medvedev warned Armenia against a “new Ukraine” scenario; Armenian opposition figures said authorities should respond. Business & Society: Unibank backed AGBU’s Global Run for Camp Nairi, raising $500,000 across 22 cities to support displaced children and families. Economy Watch: Armenia’s industrial price index rose in Jan-Aug 2026 vs a year earlier, while consumer inflation stayed around 4.4–4.5%, driven largely by food prices.

Armenia-Iran Trade & Connectivity: Foreign ministers Ararat Mirzoyan and Seyed Abbas Araghchi met in Tehran to push energy, transport and infrastructure projects, including a second border bridge, a third power transmission line and steps to facilitate freight; they also highlighted progress on TRIPP and support for the “Crossroads of Peace.” Currency & Prices Watch: The dram held at 362.3 per $1 while strengthening versus the euro and ruble on the Armenian interbank market; meanwhile, the industrial price index rose in Jan-Aug 2026 and inflation stayed around 4.4–4.5%, with food prices a key driver. Banking & Finance: Armeconombank reopened its Artashat branch at a new address, citing growth in loans and deposits; Evocabank also secured $10m in subordinated financing to bolster lending to MSMEs. Business & Policy Signals: Armenia still has 1,779 unused duty-free EV import quotas; the State Revenue Committee says tax administration is becoming more preventative with AI tools. Regional Logistics Funding: The World Bank estimates the Middle Corridor needs $55bn+ by 2040, warning that infrastructure alone won’t fix border and rail-to-port bottlenecks. Security & Diplomacy: Russian Security Council deputy chairman Medvedev warned Armenia could face a “Ukrainian scenario” amid its Western shift.

Jobs & Tax Take: Armenia reported a record 830,417 income-generating jobs in August, while tax revenues and duties hit AMD 2.03 trillion in the first eight months (+14.6%) and AMD 2.31 trillion in nine months (+14.7%), according to the State Revenue Committee. Energy & Infrastructure: Prime Minister Nikol Pashinyan said a new 1,000 MW nuclear plant could be the “most logical” answer as electricity demand rises, and ordered alternative road construction to prevent future traffic jams; meanwhile, Yerevan is starting a 1.5 billion dram Noragavit transport interchange overhaul. Housing & Social Policy: Pashinyan said about 90% of Armenia’s housing stock is dilapidated and needs renovation, and the government will redirect burial allowance funding toward pension increases (minimum pensions up 1,000 drams from Jan 1). Trade & Industry: Armenia lifted temporary cement import restrictions from third countries to diversify supply, and Proshyan Brandy Factory plans to buy 32,000+ tons of grapes this season. Regional Connectivity: Armenia-US talks focused on regional economic connectivity, while Iran offered help for Yerevan metro infrastructure. Business & Investment Climate: The second Armenia Investment and Financial Forum drew about 1,000 participants in Yerevan to discuss capital attraction and market barriers.

TRIPP & Regional Connectivity: Georgia’s PM Irakli Kobakhidze says Armenia-linked TRIPP won’t compete with the Middle Corridor but will complement it as freight volumes surge, framing the South Caucasus as a capacity expansion story. US–Armenia Critical Minerals: Armenia and the US have started practical work to implement their May critical-minerals memorandum, with State Department officials meeting government, business and civil society; no specific funding was announced. Nuclear Decision Nears: Rosatom offered Armenia a 1GW-plus reactor proposal (VVER-1000) as Yerevan weighs options for replacing Metsamor, stressing price, safety and timelines over politics. EU Engagement: An EU COEST delegation met Armenian officials on integration, security and connectivity, including EU trade liberalisation measures. Elections Under Scrutiny: PACE assessed Armenia’s June 7 parliamentary vote as orderly and competitive, but flagged foreign interference claims, campaign-finance and media bias concerns. Armenia–Iran Talks: Foreign Minister Ararat Mirzoyan heads to Tehran for high-level security and economic talks, with corridor stability and bilateral cooperation on the agenda. Biodiversity Finance: Ahead of COP17 in Yerevan, a report estimates global biodiversity funding at $74.9–92.4bn annually, with Armenia hosting the conference.

Biodiversity Finance for COP17: New OECD figures put global biodiversity funding at about $74.9–92.4bn per year (2023–2025), with public domestic spending the biggest share and private finance also rising—setting the backdrop for COP17 in Yerevan (Oct 19–30). Armenia–Lebanon Tech Links: Armenia’s ambassador met Lebanon’s Nicolas Rouhana to explore cooperation between the two countries’ tech ecosystems, aiming to connect startups, investors and companies. High-Tech Shift to Products: Armenia’s deputy high-tech minister told AmCham that the sector must move from services to homegrown products and advanced tech (including AI and health tech), calling for predictable AI rules and investment. French Development Agency Support: Armenia’s deputy PMs discussed AFD cooperation on reservoirs, water resources, healthcare insurance, energy and trade diversification, with a reported €250m credit line tied to the 2026 budget deficit. Healthcare Reform Push: Croatia is helping Armenia reform its healthcare system and universal health insurance via a €1.5m EU-funded twinning with Croatia and Slovenia. EAEU Export Barriers: Armenia’s leadership reiterated efforts to remove barriers to exports and transit within the EAEU as regional connectivity and trade remain central themes.

AI & Tech Push: Armenia is urging a shift from AI services to homegrown products and advanced tech, with officials pitching predictable AI rules and investment opportunities for U.S. partners. Digital Voice Expansion: Krisp says its Armenia-developed voice AI is expanding fast, including voice translation across 62 languages, as it seeks more startup and international market deals. French Development Finance: Deputy PMs met AFD on reservoir and water projects, plus healthcare insurance, energy and trade diversification; a €250m credit line for budget support is in focus. EAEU Trade Friction: Prime Minister Pashinyan told the EAEU council that export and transit barriers for Armenian goods remain unresolved, calling for removal of administrative obstacles; TRIPP is also tied to direct rail connectivity plans. TRIPP Under Scrutiny: Russia’s Security Council criticized U.S. involvement in TRIPP, warning about potential private military or intelligence footprints, while Armenia rejects any foreign armed presence. Nuclear Decision Watch: Armenia’s nuclear strategy is again under review as demand rises, with talk of moving from small modular reactors toward a larger 1,000 MW option. Energy Grid & Storage Rules: Armenia’s regulator discussed draft bylaws for electricity storage stations as solar growth accelerates and grid stability risks rise. Healthcare Reform (EU-linked): Croatia is helping Armenia reform healthcare insurance via an EU-funded twinning project. Business & Markets: Armenia’s reserves and economic indicators continue to be reported as strengthening, while banks and telecom firms push new digital and investment offerings.

Healthcare Reform: Croatia is helping Armenia overhaul its healthcare system, including universal health insurance, via a €1.5m EU-funded Twinning project with Croatian and Slovenian experts working on legislation, financing, digital tools and staffing. EAEU Trade Friction: Prime Minister Nikol Pashinyan told the EAEU Intergovernmental Council that “no significant progress” has been made on barriers and administrative hurdles blocking Armenian exports and transit within the EAEU common market. TRIPP Railway Push: Armenia’s ambassador says practical steps for TRIPP—linking Armenia and Azerbaijan by rail—should start in early 2027, after a study phase; Russia’s Security Council has warned about possible security and ownership concerns. Energy Regulation: Armenia’s Public Utilities Regulatory Commission discussed draft rules for electricity storage stations as solar growth accelerates and grid stability risks rise. Capital Markets: Team Holding completed a three-stage corporate bond placement, raising about $35m, signaling continued investor appetite for Armenian corporate financing. COP17 Finance & Branding: Armenia issued a COP17 silver commemorative coin minted with solar energy and recycled materials, as preparations for the Oct 18–30 biodiversity summit continue.

Rail Connectivity: Russia says it is waiting for Armenia’s response on restoring two railway sections under Russian Railways concession—Yeraskh to Nakhchivan and Gyumri to the Turkish border—after decisions were made at the presidential level in January. EAEU Trade Talks: Prime Minister Nikol Pashinyan reiterated Armenia’s commitment to EAEU cooperation and urged removal of barriers to Armenian exports and transit, highlighting TRIPP as a potential rail link between Armenia and Azerbaijan and a corridor toward the Persian Gulf and Black Sea. Energy & Regulation: Armenia will regulate electricity storage facilities via new secondary legislation as the country shifts from surplus to deficit energy conditions. Capital Markets: Team Holding raised about $35m after completing a three-stage corporate bond placement ahead of schedule. Banking Products: Unibank completed AMD-denominated bond placement (AMD 3bn) and is running a USD bond issue (USD 3m) with a 6% annual coupon. Tech & Industry: Armenia’s Engineering Week 2026 kicked off in Yerevan, focusing on “Physical AI,” while Microchip Technology discussed expanding regional operations in Gyumri, Vanadzor and Ijevan. Macro Watch: Armenia’s gross international reserves hit a new record, topping $6.53bn by September 2026. COP17 Prep: Armenia unveiled a recycled-silver COP17 commemorative coin and continues preparations for the biodiversity summit in Yerevan (Oct. 18–30).

TRIPP and regional peace: Azerbaijan’s Hikmet Hajiyev said peace with Armenia must be implemented “not only on paper,” adding Baku expects constitutional changes removing territorial claims. Security and trade corridor tensions: Russia’s Security Council deputy secretary Alexei Shevtsov warned the “Trump Route” could amount to a “state within a state,” citing risks of US private military and intelligence presence, and said Washington could even block cargo via the corridor. US-Armenia economic diplomacy: Armenia’s deputy foreign minister Vahan Kostanyan told an AmCham event that TRIPP is moving toward practical steps, with the Armenia–US strategic partnership showing “unprecedented dynamics.” Budget watch: The government approved the 2027 draft budget, with spending around 4.1 trillion drams, a deficit near $1.29bn, and defense funding rising to about 620bn drams; separately, the opposition ARF warned external debt jumped by $1.174bn in Aug–Sep. Tech and AI push: Armenia discussed AI regulation, AWS support for a Virtual AI Institute, and Firebird AI’s second-phase investment estimate rising to $7–8bn; Viva and Amio bank also launched a digital card offer that can cover telecom bills. Innovation rankings: Armenia held 59th in WIPO’s Global Innovation Index, improving in several categories.