The Armenian government’s Statistical Committee put its total amount at 1.84 trillion drams ($4.6 billion), down by 0.6 percent from the same period of 2022. A downturn in the country’s export-oriented mining sector appears to have been instrumental in this drop contrasting with double-digit increases in trade, other services and construction.
The government data shows that wholesale and retail trade is the fastest growing sector of the domestic economy at present, having expanded by over 23 percent in January-September amid Armenia’s soaring trade with Russia.
Armenia’s imports and exports jumped by roughly 48 percent, continuing a trend that began after last year’s Russian invasion of Ukraine and the resulting barrage of Western sanctions against Russia. Goods manufactured in Western countries and their allies and re-exported from Armenia to Russia clearly accounted for most of this sharp gain. They mainly included second-hand cars and consumer electronics.
This explains why Armenian exports to Russia tripled in 2022 and doubled in January-August 2023. During the eight-month period, Russia generated half of Armenia’s overall export revenue worth $4.6 billion.
Used cars became Armenia’s number one export item in the first half of this year, according to data from the national customs service reported by Hetq.am. The South Caucasus country, which has no car industry, exported $311 million worth of various vehicles, circumventing U.S. and European Union bans on their shipments to Russia. Also, its first-half exports of mobile phones, TV sets and other electronics totaled $332 million.
The re-exports, coupled with other cash inflows from Russia, are the main reason why the Armenian economy expanded by 12 percent in 2022. The Armenian government and the Central Bank have forecast a 7 percent growth rate for this year.
The re-exports prompted concern from EU and especially U.S. officials earlier this year. They pressed the authorities in Yerevan to comply with the Western sanctions. The authorities introduced in May mandatory government licenses for shipments of microchips, transformers, video cameras, antennas and other electronic equipment to Russia.