Armenian MPs support raising cement import tax to protect local producers

PanARMENIAN.Net - On May 27, the Armenian National Assembly passed in the first reading a draft law to increase the state duty on cement imports. The bill received 57 votes in favor, 1 against, and 21 abstentions.

The initiative aims to preserve the competitiveness of domestic cement producers, according to Armenpress.

Under the proposed legislative amendment, the state duty for a cement import license per 100 tons would rise from the current 200-fold base rate to an 800-fold rate.

Deputy Minister of Economy Edgar Zakaryan presented the bill, citing the need to maintain economic and industrial equilibrium. He emphasized that cement is a strategic commodity, and ensuring its continuous domestic production is vital for Armenia’s national economy.

Zakaryan noted a sharp drop in cement import prices due to foreign subsidies and low energy costs abroad, which has negatively affected the competitiveness of Armenian producers.

In 2023, approximately 260,000 tons of cement were imported—3.5 times more than the previous year—making up 22.4% of local production volume. Imports in 2024 have also risen by around 65%.

He highlighted that the production cost of local cement is heavily influenced by energy expenses, leading to imported cement being sold at 27,500 AMD per ton compared to 35,000–37,000 AMD for locally produced cement.

“This situation seriously undermines local producers and threatens their survival. If this continues, we risk full market dependency on imports, damaging our industrial policy and causing unpredictable price hikes,” Zakaryan stated.

Opposition MP Artsvik Minasyan of the "Armenia" faction noted that cement is a strategic good and the issue requires a systemic solution, not a simplistic approach, reports Panorama.am.

“Its multifaceted impact—from construction to environmental consequences—must be studied thoroughly. Setting a price to balance the market should consider all components, not just apply a mechanical tariff that lacks market flexibility. A formula should be adopted that equitably addresses both imports and local production,” he argued.

Minasyan criticized repeated piecemeal adjustments, saying they ignore the underlying systemic problem.

“Yes, we criticized the 2,000-dram reduction back then. We predicted this situation—imports would pressure local producers. You didn’t listen then. Now again we say: a systemic solution is needed, not mechanical tariff tweaks each time,” the MP stated.