Open borders could boost Armenia-Turkish trade tenfold – Economy Ministry

PanARMENIAN.Net - The share of Armenian-Turkish trade turnover in Armenia's foreign trade is 1%. If direct trade is launched between Yerevan and Ankara, this figure may increase to 10% or more, the Ministry of Economy of Armenia has told Sputnik Armenia.

The Ministry clarified that they do not have their own analysis of the matter, and the data are taken from a number of international organizations.

According to the World Bank, the export potential from Armenia to Turkey ranges from 15 to 19% of our country’s GDP. According to the German consulting company German Economic Team, the opening of direct trade between Yerevan and Ankara will lead to an increase in the share of exports from Armenia to Turkey to 6.7% of the total exports of the Republic of Armenia, and imports from Turkey could reach 12.8% (of the total volume of imports to Armenia).

At the same time, the Asian Development Bank (ADB) predicts a reduction in Armenia’s foreign trade deficit by 30-50% if the border with Azerbaijan and Turkey is unblocked.

For any landlocked republic, neighboring countries are not only markets for trade, but also transit routes to third countries, the Ministry of Economy explains.

The Ministry emphasized that the closure of the border with two neighboring countries (Azerbaijan and Turkey) reduces Armenia’s foreign trade opportunities and limits alternative routes for cargo transportation. This also negatively affects the competitiveness of the country in the cargo transportation market and leads to their high cost.

The Ministry of Economy does not rule out that the land route through Turkey could lead to a decrease in the volume of cargo transportation by Armenia through Georgia.

“This may be the case if the new route is less expensive and more profitable for carriers, and especially for trade with third countries,” the department noted.