Armenian finance minister addresses economic impact of Russian restrictions on agricultural goods

Armenian Finance Minister Vahe Hovhannisyan told lawmakers on Wednesday that he expects Russian restrictions on agricultural imports from Armenia to be lifted or efforts to diversify export markets to succeed.

Hovhannisyan was asked about the matter by opposition Armenia faction MP Artur Khachatryan during a session of the parliamentary Committee on Financial-Credit and Budgetary Affairs.

According to the minister, these difficulties do not have a major impact on state budget revenues, but the need to support those affected by Russian restrictions has resulted in additional expenditures.

Khachatryan asked to what extent external economic risks had been taken into account in the draft 2027 budget, including the consequences of potentially losing the benefits available within the Eurasian Economic Union (EAEU).

The MP also asked whether the presented forecasts represented an average of different scenarios or the most optimistic scenario.

“Our scenario is not an average scenario; we have taken the most realistic scenario,” Hovhannisyan replied.

The minister said that risk assessments had been made and that reserve funds had been allocated to mitigate their potential impact. At the same time, he emphasized that he could not say to what extent the risks would materialize.

Referring to the difficulties with agricultural exports to Russia, Hovhannisyan said that either these restrictions would be lifted or efforts to diversify export markets would succeed.

“Moreover, we have already achieved major successes. However, it is also important to note that the agricultural sector itself is not a major tax-paying sector, and therefore there is no major impact on our budget revenues,” Hovhannisyan said.

The minister added that many citizens work in this sector. According to him, the impact of the problems that have arisen has been reflected this year in the need for additional expenditures to support them. However, in his assessment, the volume of these expenditures does not change the budget scenario presented.