<hdr>The World Factbook 1994: Armenia<nl>Economy</hdr><body>
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<item><hi format=bold>Overview:</hi> Under the old central planning system, Armenia had built up a developed industrial sector, supplying machine building equipment, textiles, and other manufactured goods to sister republics in exchange for raw materials and energy resources. Armenia is a large food importer and its mineral deposits (gold, bauxite) are small. The economic decline in the past three years (1991-93) has been particularly severe due to the ongoing conflict over the Armenian enclave of Nagorno-Karabakh in Azerbaijan. Azerbaijan and Turkey have blockaded pipeline and railroad traffic to Armenia for its support of the Karabakh Armenians. This has left Armenia with only sporadic deliveries of natural gas through unstable Georgia, while other fuel and raw materials are in critical short supply. Inflation, roughly 14% per month in the first nine months of 1993, surged even higher in the fourth quarter. In late 1993, most industrial enterprises were either shut down or operating at drastically reduced levels. Only small quantities of food were available (mostly humanitarian aid), heat was nonexistent, and electricity strictly rationed. An economic recovery cannot be expected until the Nagorno-Karabakh conflict is settled and until transportation through Georgia improves.
<item><hi format=bold>National product:</hi> GDP—purchasing power equivalent—$7.1 billion (1993 estimate from the UN International Comparison Program, as extended to 1991 and published in the World Bank's World Development Report 1993; and as extrapolated to 1993 using official Armenian statistics, which are very uncertain because of major economic changes since 1990)
<item><hi format=bold>National product real growth rate:</hi> -9.9% (1993 est.)
<item><hi format=bold>National product per capita:</hi> $2,040 (1993 est.)
<item><hi format=bold>Inflation rate (consumer prices):</hi> 14% per month average (first 9 months, 1993)
<item><hi format=bold>Unemployment rate:</hi> 6.5% of officially registered unemployed but large numbers of underemployed (1993 est.)
<item><hi format=bold>Budget:</hi>
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<item>• <hi format=ital>revenues:</hi> $NA
<item>• <hi format=ital>expenditures:</hi> $NA, including capital expenditures of $NA
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<item><hi format=bold>Exports:</hi> $31 million to countries outside the FSU (f.o.b., 1993)
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<item>• <hi format=ital>commodities:</hi> machinery and transport equipment, light industrial products, processed food items, alcoholic products (1991)
<item>• <hi format=ital>partners:</hi> NA
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<item><hi format=bold>Imports:</hi> $87 million from countries outside the FSU (c.i.f., 1993)
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<item>• <hi format=ital>commodities:</hi> grain, other foods, fuel, other energy (1991)
<item>• <hi format=ital>consumption per capita:</hi> 2,585 kWh (1992)
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<item><hi format=bold>Industries:</hi> traditionally diverse, including (as a percent of output of former USSR) metalcutting machine tools (5.5%), forging-pressing machines (1.9%), electric motors (9%), tires (1.5%), knitted wear (4.4%), hosiery (3.0%), shoes (2.2%), silk fabric (0.8%), washing machines (2.0%), chemicals, trucks, watches, instruments, and microelectronics (1990); currently, much of industry is shut down
<item><hi format=bold>Agriculture:</hi> accounts for about 45% of GDP; only 17% of land area is arable; employs 20%-30% of labor force as residents increasingly turn to subsistence agriculture; fruits (especially grapes) and vegetable farming, minor livestock sector; vineyards near Yerevan are famous for brandy and other liqueurs
<item><hi format=bold>Illicit drugs:</hi> illicit cultivator of cannabis mostly for domestic consumption; used as a transshipment point for illicit drugs to Western Europe
<item><hi format=bold>Economic aid:</hi>
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<item>• <hi format=ital>recipient:</hi> considerable humanitarian aid, mostly food and energy products, from US and EC; Russia has granted 60 billion rubles in technical credits
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<item><hi format=bold>Currency:</hi> 1 dram=100 luma; introduced separate currency in November 1993
<item><hi format=bold>Exchange rates:</hi> NA
<item><hi format=bold>Fiscal year:</hi> calendar year
