A panel discussion entitled “The Economic Significance of the Armenian-Turkish Border” was held at the Ashot Yerkat Hall of the Armenia Marriott Hotel in Yerevan. Experts in economics and officials of state departments participated as speakers.
The discussion was organized by the website ermenihaber.am, a specialized platform on Armenian-Turkish issues. Its aim is to inform RA citizens about the economic significance of the Armenian-Turkish border.
The discussion took place in two parts: the first recorded the economic consequences of the closed border, and the second discussed the prospects for a possible border opening.
In his opening speech, Mkhitar Nazaryan, editor-in-chief of the aforementioned website, briefly presented the current realities of the closed border. Then, he raised questions related to economic interests, risks, and expectations.
Former Deputy Minister of Industry and Trade of the Republic of Armenia, General Director of Greenland Investment Movses Dzavarian, noted that if the border is opened, Turkey will be of great importance for us, first of all, as a transit zone.
“In my opinion, opening the border will be of greater importance in humanitarian terms so that neighboring populations will have the opportunity to communicate with each other.”
Gagik Makaryan, head of the Socio-Economic Development Center, advocated for opening the border while emphasizing that Armenia’s readiness in all aspects and with all mechanisms must precede it.
“Now we import many goods from Turkey or export them to Turkey through the territory of Georgia. Transportation costs and commission fees will be significantly reduced when opening the border. It would be desirable for our Ministry of Economy to carry out this calculation.”
Albert Hayrapetyan, Head of the Economic Research Department of the Ministry of Economy of the Republic of Armenia, noted an axiomatic truth in international economics: free trade contributes to a more efficient allocation of resources.
“As soon as the border is opened, we will have free trade with a country considered a member of the European Union Customs Union. According to the Asian Development Bank, in the event of the opening of the border, Armenia’s GDP growth will amount to 30 percent, and the foreign trade deficit will be reduced by 30-50 percent. According to the World Bank, export growth can lead to an increase in Armenia’s GDP of up to 38 percent.”
Hrant Mikaelyan, head of the Institute of Armenian Studies, believes that there is a trade potential with Turkey, but it should not be overestimated. According to the speaker, if the Armenian-Turkish border opens, our export and import volumes to Turkey may significantly increase.
“But I do not have such expectations regarding the estimates according to which exports to Turkey may amount to 6 percent of Armenia’s export volume. I also do not expect that there will be a large investment flow in the event of the opening of the border because the geographical position of Armenia will not change in any case. The problem of delivering one container to Armenia is not only due to the closed border with Azerbaijan or Turkey but also the complications of the purely geographical position.”
Deputy Head of the Department of Customs Service and Control of Foreign Economic Activity of the State Revenue Committee of the Republic of Armenia, Mher Martirosyan, addressed the question of whether Armenia’s customs infrastructure is ready to handle the expected trade flows in the event of the border opening.
“I can say that, yes, we are ready. We have a customs infrastructure both inside the country and at the border. Moreover, it plans to establish a large center to service foreign economic activity in the Yerevan region. We have already created infrastructure on the Margara border with Turkey and can serve trade flows. And there is still work to be done regarding the railway in Akhurik.”
