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Business Opportunities in Armenia 2022  

Business Opportunities in Armenia 2022 

Foreign business owners and investors appreciate the pace of the economic reforms, Armenia's safety, freedom and openness. There are generally no restrictions on foreign ownership of companies, real property and other assets. Armenia guarantees free repatriation of invested capital and profit. Investment projects are encouraged with tax benefits and government assistance programs. 


Zero-tax status is available to micro-businesses, IT start-ups, companies operating in free economic zones, industrial zones, certain border towns and villages. Other small businesses with annual sales of less than around $220,000 are subject to sales (turnover) tax of only 1.5-5%. Armenia generally does not tax individual's capital gains on the sale of securities, real estate or other assets. Insurance and pension payment are also exempt from taxes. There are no taxes on gifts, inheritance, net worth, etc. Property taxes are very low. 


Investing in Armenia can qualify you and your family members for a residence status (temporary, permanent, or special). Under general naturalization rules, a foreigner may become eligible for Armenian citizenship after three years of residency. 

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2021.01.26 Investment
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Rates as of Feb. 2022

Bank Deposits

Bank

Armenian Dram (1-3 Years)

US Dollar (1-3 Years)

ACBA

7.5%-9%

3.25%-4%

Ameriabank

8%-9%

2.4%-3%

Araratbank

8%

4%

Ardshinbank

8.75%

2.75%-3.5%

Armbusinessbank

8.75%-10.25%

3.2%-4.35%

Armeconombank

8%-9.25%

3.7%-4.5%

Armswissbank

8.5%-9.25%

3.75%-4%

Artsakhbank

8.5%-9%

3%-4.25%

Byblos Bank Armenia

9%-9.25%

4%-4.25%

Converse Bank

8.75%-10%

3.25%-4.5%

Evocabank

8.25%-10.75%

3.25%-5.25%

HSBC Armenia

7%-7.5%

1.5%

ID Bank

8%-9%

3%-4%

Inecobank

9%-9.5%

3.15-3.4%

Unibank

9%-9.75%

2.9%-4.1%

VTB

9.3%

1.75%-2.15%

Bonds

Issuer

Armenian Dram 

US Dollar 

Spayka

11․3%

8.65%

Ucom

11․5%

7.5%

ASCE Group

11․75%

6․85%

ZCMC

11%

5․75%

Government Subsidies for Agriculture

Agriculture is one of the moving forces of the Armenian economy. However, the full potential of the country is left unrealized, which is why the government has created different subsidy programs to boost selected agricultural sectors. 


Orchards & Vineyards


Fruit farming and wine growing are one of the oldest agricultural sectors in Armenia. Today, more than 60,000 entities are engaged in fruit farming and wine growing. Grape, apricot, and peach cultivation are the most popular forms. Between 1998 and 2016, the territory occupied by orchards doubled, and the yield has increased by 14.5% between 2008 and 2017 due to implementation of innovative technologies.


The government provides two types of subsidies: compensation of costs incurred in setting up a vineyard/orchard or a low-interest rate loan. 


Loan terms:

  • Interest rate: 2% (0% for farmer in border communities and cooperatives) 
  • Size of the vineyard/orchard: 0.5-100 hectares
  • Maximum loan amount:
    • Vineyards: $2.9 million 
    • Intensive orchards: $5 million
    • Berry farms: $4.7 million
  • Maximum term: 8 years with a grace period of 5 years 

Compensation:

  • 50% of costs incurred in setting up the orchard/vineyard
  • Size of the vineyard/orchard: 0.5-10 hectares
  • Maximum allowable costs:
    • Vineyards: $24,800 per hectare
    • Intensive orchards: $44,800 per hectare
    • Berry farms: $36,700 per hectare

Cattle Farming


Cattle farming adds up to more than 50 percent of the GDP generated from livestock farming and its share is growing. In recent years, both the headcount of cattle and the prices for meat and milk have increased. In comparison to 2016, in 2018 the price of meat and milk increased by 38% and 11% respectively. However, as this sector is dominated by small households and not enough technological solutions are used, the country is not able to utilize the full capacity of this sector.


To boost cattle farming in Armenia, the government developed a project of subsidize agricultural loans that would decrease the financing interest rate from 14% to 2%. In 2018 around 60% of these subsidies were applied to cattle breeding projects. The government also aims to boost purebred breeding and has exempted farmers from VAT on import of such cattle. In 2013-2018 more than 2,000 heads of purebred cows were imported. It is expected that the governmental subsidies will result in importation of more than 10,000 animals in 2019-2024.


Subsidized loan terms:

  • The subsidy is designed to decrease the interest rate to 2% for farmers and 0% for farmers residing in border communities.
  • The beneficiary can acquire a maximum of 300 heads of purebred cows and the total value shall not exceed $600,000.
  • The maximum term of the loan is 5 years.


Sheep and Goat Breeding


Sheep and goat breeding is also a traditional animal breeding sector in Armenia. It generates around AMD 50 billion (USD 104 million) of annual revenue, and this number can be doubled if the management of the businesses is improved. This sector focuses on production of food, wool, and leather; it involves low risks and yields high profits. Armenia has a favorable climate and conditions for sheep and goat breeding. More than 50 percent of agricultural land in Armenia are pastures.


Armenia has a high potential for lamb export. During the last four years, more than 20 thousand sheep and more than 2,000 tons of lamb were exported. The main directions for export are Iran, United Arab Emirates, Qatar, Kuwait, and Georgia. That being said, in 2019, the number of sheep and goats was around 640,000, which is about half the number that existed in 1991.


The government has allocated around $6.2 million for a subsidy program to help the farmers acquire sheep and goats. The program will provide 70% co-financing to agricultural cooperatives and 30% to individuals. It is expected that around 30,000 sheep and goats will be acquired thanks to the program. The maximum value of one purebred sheep or goat is set to around $1,000. 


Subsidy terms:

  • The subsidy will cover 23% (27% for farmers in border communities) of the actual cost for the acquisition of sheep and goat (excluding transportation costs). 
  • The beneficiary can acquire a maximum of 2,000 purebred sheep or goats. The total amount spent should not exceed $1.8 million. 


Small Business Opportunities

1. Agriculture

  • Beekeeping & honey production
  • Greenhouse (flowers, vegetables, berries, herbs, lemons, etc.)
  • Dried fruits (apricots, prunes, peaches, etc.)
  • Winemaking
  • Vegetables (celery, asparagus, broccoli, etc.)
  • Poultry farming & hatchery operation
  • Berries (strawberry, blackberry, raspberry, etc.)
  • Cattle farming 
  • Sheep & goat farming
  • Pig farming
  • Fish farming (crawfish, caviar, etc.)
  • Herb growing (herbal teas, spices, medicinal herbs, stevia)
  • Dried herbs and medicinal herbs
  • Wild harvest
  • Paulownia tree farming
  • Crops (buckwheat, emmer wheat, etc.)
  • Corn farming
  • Cotton farming
  • Mushroom farming, harvesting
  • Snail farming
  • Horse breeding

2. Food Processing

  • Cold storage for fruits and vegetables
  • Slaughterhouse
  • Fish processing
  • Cheese making, milk processing
  • Meat processing
  • Canning, packaging, freezing, etc.
  • Juice
  • Compote, jam, syrup, concentrate, pickles
  • Mushroom processing
  • Vodka (grape, apricot, apple, plum, etc.)
  • Brandy, fruit & herbal wine, tinctures
  • Pasta manufacturing
  • Processing of wild harvest (canned fruits, berries, herbs)
  • Flour milling
  • Oil production (olive, linseed, grape seed, etc.)
  • Livestock feed manufacturing
  • Organic fertilizer production
  • Leasing of farm equipment

3. Travel & Tourism

  • Guest house, bed & breakfast
  • Camping & glamping
  • Wooden, light-structure, treehouse cottages
  • Rest area (shelter, food, WC, market, souvenir shop, etc.)
  • Co-living space
  • Workation space
  • Rental of recreational vehicles
  • Travel agency
  • Souvenir shop
  • Gastronomy & wine tourism
  • Restaurants (café, pavilion, gastro-yard, etc.)
  • Craft tourism
  • Archeological tourism
  • Adventure tourism 
  • Hiking trails & tours
  • Horseback riding
  • Mountain climbing
  • Cave tourism
  • Off-road tours
  • Rental of all-terrain vehicles
  • Bicycle rental station
  • Mountain bike trails & tours
  • Fishing 
  • Eco-village 
  • Birdwatching 
  • Winter tourism (ski lodges, ski equipment rental)
  • Rental of snowmobiles
  • Recreational & athletic facilities
  • Amusement park
  • Skating rink
  • Zip line
  • Ropeway

4. Automotive

  • Gas station
  • Auto parts
  • Auto pawnshop
  • Car wash
  • Car service station
  • Carsharing
  • Help with buying used cars

5. Children's Products and Services

  • Children's center
  • Play rooms and playgrounds
  • Kindergartens
  • Goods for kids
  • Children's clothing
  • Mental math
  • Toys and games for children
  • Children's' hairdressing saloons

6. Food

  • Café
  • Restaurant
  • Fast food outlet
  • Bar
  • Coffeehouse
  • Coffee to go
  • Beer house
  • Sushi, rolls
  • Canteen
  • Hookah bars
  • Children's café
  • Burgers
  • Pizzerias
  • Pancakes & waffles
  • Ice cream
  • Shawarma

7. Education

  • Courses
  • English language schools
  • Schools & training centers
  • Schools of programming and robotics
  • Language schools and centers
  • Football schools

8. Manufacturing

  • Bakery
  • Food production
  • Building materials production

9. Trade

  • Car accessories
  • Liquor stores
  • Pharmacies
  • Vape shops, hookahs
  • Vending machines
  • Healthy food
  • Pet shops
  • Stationery
  • Confectionery
  • Cosmetics and perfumery
  • Furniture
  • Butcher shops
  • Underwear
  • Equipment and tools
  • Shoes
  • Clothing
  • Optics
  • Gifts
  • Food
  • Fish
  • Sweets
  • Building materials
  • Bags and suitcases
  • Phones & gadgets
  • Household goods
  • Health and beauty products
  • Dropshipping 
  • Flowers and plants
  • Jewelry

10. Services

  • Rentals and hire
  • Apartment rentals
  • Car rentals
  • ATV & snowmobile rentals
  • Bicycle and scooter rental
  • Manpower supply
  • Food delivery
  • Call center
  • Cleaning services
  • Courier delivery services
  • Shipping and cargo services
  • Nursing homes
  • Advertisement/marketing agency
  • Phone repair service centers
  • Construction and renovation
  • Taxi, cargo transportation
  • Shooting range
  • Pet grooming
  • Photo studios
  • Dry cleaners, laundries
  • Certification centers
  • Security & surveillance
  • Coworking spaces

11. Health & Beauty

  • Epilation and sugaring
  • Fitness clubs
  • Athletic clubs
  • Dentistry
  • Beauty salons
  • Hairdressing salons
  • Eyelash extensions
  • Medical laboratories
  • Medical centers
  • Manicure, pedicure
  • Massage parlors
  • Barbershops
  • Grooming salons
  • Fitness/yoga studios

12. Online & Home-Based Businesses

  • Online stores
  • Digital & social media marketing

13. Entertainment

  • Quests
  • Bookmakers
  • Pools, water parks
  • Virtual reality
  • Computer/cybersport clubs

14. Finances

  • Insurance brokers
  • Pawnshops
  • Credit brokers
  • Cryptocurrencies & mining

15. Professional Services

  • Legal services
  • Real estate
  • Migration center
  • Consulting
  • Bankruptcy
  • Accounting services
  • Visa application centers

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Copyright 2022 - Vardanyan & Partners LLC

Nerses Isajanyan

Managing Attorney
LL.M. Georgetown University
New York Bar | Armenian Chamber of Advocates

We are a team of licensed lawyers based in Armenia and Georgia. Our primary commitment is to provide quality service to clients at a compelling value that helps manage risk, overcome regulatory issues and advance their personal and business goals. 


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Nerses Isajanyan

Attorney

LL.M. Georgetown University

New York Bar | Armenia Chamber of Advocates

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