Armenia’s economy will greatly benefit from a free trade zone established by Russia and seven other former Soviet republics this week, Prime Minister Tigran Sarkisian insisted on Thursday.
Sarkisian described as “historic” the agreement which he and his counterparts from Russia, Ukraine, Belarus, Kazakhstan, Kyrgyzstan, Moldova and Tajikistan signed in Saint Petersburg on Tuesday.
“That agreement is creating exceptional opportunities for Armenia’s economy and economic entities,” he told a weekly meeting of his cabinet. “We will be able to trade without customs duties with those seven countries that signed this agreement.”
“Our economic entities are getting more favorable conditions to sell their goods and services in that joint economic area,” added Sarkisian. “I am convinced that this will serve as an additional stimulus for the development of our economic capacity.”
The premier also insisted that the deal initiated by Russia’s Prime Minister Vladimir Putin does not run counter to Armenia’s membership commitments to the World Trade Organization (WTO). “This document was drawn up in accordance with the principles of the World Trade Organization,” he said.
Russia and some of other signatory states are not members of the WTO.
The Saint Petersburg agreement, which is subject to parliamentary ratification, will not immediately exempt all goods from import duties.
Sarkisian spoke on Thursday of “limitations” on free trade contained in “transitional provisions” of the accord. Their number will be gradually reduced by the eight ex-Soviet states, he said without giving further details.
Economy Minister Tigran Davtian agreed that the deal will help to boost Armenian exports to Russia, Ukraine and the five other members of the new free trade zone. But he also noted that Armenia has enjoyed essentially tariff-free commercial operations with virtually all of those countries for over a decade.
“That has now been formalized in a multilateral format,” Davtian told RFE/RL’s Armenian service (Azatutyun.am).
According to official statistics, the Commonwealth of Independent States accounted for only 16.4 percent of Armenia’s exports that totaled almost $827 million in the first eight months of this year. By comparison, Armenian exports to the European Union were equivalent to almost half of this figure.