Titelaufnahme

The Armenian and Russian economies are tightly knitted and the sanctions imposed on Russia will have a significant short- and long-term impact on the economic life of Armenia. In the article, we discuss how the companies that used to operate in Russia look for new places to relocate themselves and to develop their business. Business relocation may be required for various reasons, including establishing new connections, finding a more profitable tax system, convenience and access to technology and cheap labor. However, changing the location has become one way of how to avoid the pressure of sanctions and restrictions for Russian organizations. The first wave of relocations encompassed companies from the high-tech and service sectors. Even though they have benefited from tax exemptions and deferments for the IT sector, these companies have contributed to the improvement of economic activity as well as generated additional consumption and rent payments. Armenia has capitalized additional output and export increase of some industries. However, the economic growth is not proportional. The impact of sanctions against Russia has already been manifested in Armenia by the instability of the exchange rate, the significant increase in prices, intensified inflation pressure, etc. Indeed, difficult times await not only Russia, but also Armenia, as long as the latter continues to be over-integrated into the Russian economy which entails partly sharing the burden of the consequences of the westimposed sanctions. Under the conditions of increasing economic turbulence, Armenia should further diversify its policies and economy.