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Armenia - An Emerging Opportunity By Jason White linkedin.com - 30/10/2014 For a British businessman living and currently working in Yerevan, Armenia, it has become a prelude to an interesting conversation. "Where is Armenia actually?" Sadly one of those who actually asked that question was in fact a British International Sales Director. What this determines, besides a certain ignorance of Armenia by the British business community and general British public, is Armenia's lack of marketing towards the UK (and other countries), whether it being for business, tourism or general awareness of Armenia's Christian history, culture and heritage. To put it politely - what a shame, to be more specific it is, to say the least, a missed opportunity that seems sadly to be continuing. The land that Noah discovered has indelibly become the Shadow lands. I believe that the climate and time is now right for business and economic opportunity in Armenia. There is potential for closer ties to UK businesses that could bring positive benefits to both the economy here and the development of overall products and services in the UK. Armenia has previously been held back partly due to its recent communistic history but also to its political and oligarchy regime monopolizing its major industries and limiting economic options. However there is now a genuine and committed campaign to affect a positive change that is gaining momentum and moving forward by the new generation of entrepreneurs, leading creatives, community builders, investors, policymakers, developers, young leaders and many others - all collaborating toward a more successful Armenia. You can now taste the appetite for a change that had seen huge amounts of charitable initiatives from Armenia's historic diaspora (11 Million Armenian expats live in other countries, USA, Russia, France, Syria Australia to name a few) to a move towards sustainable investment whereby the mission is to support and ultimately sustain Armenia's long term future. To cut to the chase what Armenia lacks in natural resources it more than makes up with its intellectual ability- its highly educated and innovative population is its greatest asset bringing together a mixture of skills, perspectives and resources with the result an opportunity for innovation and entrepreneurship to the benefit of joint venture partnerships with potential overseas companies and Investors. In Yerevan salaries are very low, not far behind China, commercial office and residential rents are also comparatively low as is understandably the cost of living. The average salary here is £280 per month. The opportunity for cost savings on salaries and general expenses of Key Executive staff are huge for potential overseas companies willing to engage here. Key Reasons To Consider Armenia Armenia has a history of a high educated population. It is strong in professionals trained in Information Technology, medical, engineering (architecture, construction) and education. Allied to that the IT and Telecom Industry is the most productive industry in the Armenian economy. The Government has declared the IT sector as a priority and is supporting it through various support institutions, such as IT Development and Support Council chaired by PM, Enterprise Incubator Foundation backed by the World Bank funding. The industry already attracted global brands such as Synopsis, which located considerable part of its development functions in Armenia. Most of the foreign owned companies are involved in offshore programming, serving foreign headquarters. A number of different business models, business plan competitions mark the dynamism of the industry. A major boost to the sector is expected to come from a $24 million World Bank funded project on e-society development and innovation support through "Computers for all" program, digital ID cards, venture fund creation and matching funds. Armenia for many years has been the economy with the fastest GDP rate in the Caucasus region (beside oil rich countries). The European Union is Armenia's main trading partner, accounting for around 30% of Armenia's total trade. EU imports from Armenia chiefly consist of manufactured goods, crude materials, miscellaneous manufactured articles, machinery and transport equipment. EU exports to Armenia are dominated by machinery and transport equipment, miscellaneous manufactured articles, chemicals, and foodstuffs. The current Partnership and Cooperation Agreement does not include tariff preferences, but prohibits quantitative trade restrictions and also envisages progressive regulatory approximation of Armenia's legislation and procedures to the most important EU and international trade related laws and standards, which in turn aims at facilitating the access of Armenian products to the EU market. Under the EU Generalised Scheme of Preferences, Armenia has been benefiting from the special incentive arrangement for sustainable development and good governance, the so-called Generalised Scheme of Preferences Plus (GSP+), since July 2005. This arrangement offers Armenian exports advantageous access to the EU market since it provides for a zero duty rate for about 6400 tariff lines. The total value of preferential Generalised Scheme of Preferences (GSP) imports from Armenia into the EU is steadily increasing, from EURO 61 million in 2009 to EURO 109 million in 2011. Armenia's GSP utilisation rate is high: around 90%. The country has recently signed an agreement to join the newly formed Eurasian Economic Union (Market size 171 Million people) including Russia, Kazakhstan and Belarus. This faced stiff resistance from the opposition parties and younger entrepreunerial commentators and business owners, however strong the relationship has been and will continue with Russia there is still good economic relations with America who also have a strong influence here in Armenia where there is a willingness to continue to develop business relationships that have been ongoing over the last few years through the various aid groups. Also in addition those gained by European Commission representation in the country and the policing of their aid to improve the various infrastructure, legal, health, agriculture and women's rights projects that will continue. Even with the signing of closer ties to Russia, Armenia can offer an additional route into Russia's and other ex CIS economies that many Foreign companies may want to explore given the current climate of sanctions that the western governments have ordered. Research and Development Opportunities Given this current climate and associated detailed advantages in Armenia consideration could be given to the benefits of relocating and resourcing certain company functions. None more so than R and D centres, comparative advantages would be: Availability of highly qualified, technical and innovative workforce. Multi language skilled personnel in Armenian, English, Russian and French. Low cost of living and therefore low salary base. Average salary £280 per month (UK £2051) Good work/life balance. 3.1Milion Country population Yerevan 1.1Million. Low office, residential, utility, transport and operational costs. Emergence of excellent projects and Investment in Education. Government priority, IT Incubator, international technical assistance programmes. Ongoing International company presence and onward future development in Armenia of other prespective International blue chip companies in the technology industry. Potential for developing business in the newly formed EEA Markets. This is a brief document describing the potential advantages of outsourcing Research and Development centres to Armenia, more detailed information can be gained by contacting the below mentioned who will be happy to engage in communicating more specific information governing the economy and the legal process of setting up business here. * According to the Doing Business Report 2014, released by the World Bank and the International Financial Corporation, Armenia climbed 3 points this year, ranked 37 on the list of 189 countries. Armenia appears between Belgium (36) and France (38), but ahead of such countries as Cyprus (39), Poland (45), Spain (52), Luxemburg (60) and Italy (128). Armenia is also well ahead of its immediate neighbors Turkey, Azerbaijan and Iran that are ranked 69, 70 and 152 (Georgia is ranked 8).