Vahan V. Yeghiazaryan, acting president of Zargatsum (Development) social movement
On 17 and 18 October, EU4Business Initiative annual report was presented at the Eastern Partnership (EaP) Business Forum hosted by the Czech Government.
The EU4business initiative provides support in three priority areas: Access to Finance (A2F), access to Business Development Services (BDS) and Business Enabling Environment (BEE), with a total budget of nearly €900 million. The 2022 report shows a 9% increase in the number of SMEs supported by the EU compared to the previous year, with over 78,000 companies receiving assistance. SMEs receiving support have generated an estimated extra income of €2 billion in total and created an estimated 66,000 new jobs. Among them, a third were women-owned companies.
We have interviewed key experts from the EaP countries to find out the latest updates on their business environment and the EU’s assistance in speeding up the economic boost in their countries. Here are the answers from Armenia.
What progress do you observe in your country’s business environment compared to the previous year?
2022 was a very complicated year for Armenia. The continuous aggression of Azerbaijan and occupation of Armenian bordering territories, political crisis inside the country and negative impacts of Ukrainian War on one hand and more than 40,000 middle-class migrants from Russia and Ukraine, 3-fold profit growth of the banking industry and GDP growth of around 14% on another hand. All these factors mainly had their influence on the Armenian business environment and fast-growing economy.
What areas of business support from the EU demonstrated most tangible results?
The EU4Business report 2022 presents the numbers from the previous year 2021. For 2022 we do not have any numbers yet as they are collected throughout the year. Currently, we could analyze some numbers from the previous years, e.g. one of the key metrics and tangible results for Armenian society is the number of new jobs created by the EU4Business, so for each 1 mln. Euro spent in Armenia in 2020, 105 new jobs were generated, whereas in 2021 there were 128 new jobs. So, we can see around 22% raise of productivity in this field and 2055 new jobs created in 2021 in the companies supported by EU4Business. This is very impressive and clear key result for an average Armenian citizen. IT, Tourism and Agriculture SMEs were traditionally more active and received more support from the initiative.
What other joint projects with the EU could be most useful for your country’s economic boost?
Armenia currently needs more professional and business-refocusing projects. Mainly in the Southern Vayots Dzor, Syunik and Eastern Gegharkunik provinces. Many farmers from the bordering regions with Azerbaijan cannot adapt to the reality after Azerbaijan’s 2022 aggression when their bordering pasturelands were occupied. These farmers need extensive support to accept the new reality. EU4Business has enough budget for these people. EU could have a decisive systematic influence and support joint projects, which could boost the number of European tourists to Armenia, but unfortunately, we do not see outstanding results in this field. New kinds of joint projects should be supported by EU4Business to make this goal a reality. There is a huge potential for collaboration in IT industry. EU is one of the leading markets for Armenian IT companies. There are a lot of projects supported by the EU, but at the same time, the current level of B2B collaborations was mainly reached by the efforts of the business community itself and could be significantly boosted by BDS large-scale projects with mid-size, big, and giant European tech companies. Another industry that has significant importance for Armenia is renewable energy. Usage of this industry raised during the last few years, but Armenia still has a huge unused potential in this field, which could be boosted.
