Trade Policy Review: Armenia (original) (raw)

TRADE POLICY REVIEW:

Concluding remarks by the Chairperson

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• Trade Policy Review: Armenia

This second Trade Policy Review of Armenia has offered us a good opportunity to deepen our understanding of recent developments in, and challenges to, its trade and investment policies. I would like to thank the delegation from Armenia, led by Mr. Avag Avanesyan, Deputy Minister of Economic Development and Investment, for their constructive engagement throughout this exercise. I would also like to thank our discussant, Ambassador Michael Gaffey, Permanent Representative of Ireland to the WTO, for his stimulating, analytical observations, as well as the 20 delegations which took the floor, for their active participation in this Review.

Members noted Armenia's improvement in its economic and trade performance since its first review in 2010, in particular its recovery from the 2008 global financial crisis with an average annual 4% GDP growth rate, albeit with some fluctuations. Members recognized that Armenia's economy was characterized by low inflation, declining poverty and significant progress in enhancing its macroeconomic stability in which trade in goods and services, which is the equivalent of 87% of GDP, played a growing role.

While commending Armenia for these achievements, Members also noted the challenges remaining in some areas, including the country's vulnerability to external shocks and the need to step up efforts to diversify the narrow production and export base which continue to be concentrated in the mining and tourism sectors and reliant on a limited number of trading partners.

Members therefore welcomed Armenia's efforts to pursue broader economic partnerships by acceding to the Eurasian Economic Union (EAEU) in 2015, to the EU-Armenia Comprehensive and Enhanced Partnership Agreement (CEPA) in 2018 and to several free trade agreements. Members were encouraged by many of the advances towards further economic integration into the world economy and the objectives of Armenia's Development Strategy 2014-2025.

However, Members were also interested in better understanding the impact of membership of the EAEU on Armenia's trade policy and its WTO obligations. A number of issues were raised in this regard:

• First, accession to the Union had led to tariff increases on many tariff lines with the average applied tariff increasing from 2.7% in 2009 to 7.5% in 2018. Noting that Armenia was currently engaged in negotiations with interested parties under GATT Articles XXIV and XXVIII, Members hoped that Armenia would be able to conclude these negotiations at an early date;
• Second, in the area of TBT and SPS measures, Armenia was asked to clarify inter alia the status in Armenia of EAEU technical regulations not yet notified to the WTO;
• Third, Members also raised concerns about certain legislative changes in government procurement as a result of Armenia's EAEU accession, such as harmonised EAEU blacklisting provisions and their compatibility with the GPA;
• Finally, Members requested clarification of recent amendments to harmonize Armenia's Competition Law with that of the EAEU.

Encouraging Armenia to continue its constructive engagement with the WTO, Members commended Armenia for acceding to the Government Procurement Agreement (GPA) in 2011 and the revised agreement in 2015, and more recently on Armenia's ratification of the Trade Facilitation Agreement in 2017. Members noted that further to notifying its A, B and C category commitments, Armenia had already implemented many of the B category commitments earlier than indicated in the notification. Members also encouraged Armenia to become a party to the Information Technology Agreement and to ratify the protocol amending the TRIPs Agreement in the near future.

Members recognized Armenia's positive record of fulfilling its WTO transparency commitments. However, they also encouraged Armenia to make further efforts to fill some remaining gaps in its WTO notifications, including in the areas of: import licensing and quantitative restrictions; subsidies and countervailing measures; and domestic support for agriculture. Members underlined that by fulfilling its notification obligations, Armenia was helping to support the WTO's monitoring function and the capacity of other Members to properly appreciate the policy measures taken by Armenia.

Members praised Armenia's general openness to FDI and its recognition of the important contribution it can have on economic development. At the same time, Members encouraged further domestic regulatory reforms to continue improving Armenia's business environment with a view to facilitating commercial activity and stimulating sustainable growth. However, Members also highlighted that they wanted to see more effective enforcement and progress in Armenia's capacity-building in the protection of intellectual property rights. Noting that cigarettes and other tobacco products manufacturing was becoming increasingly important as a source of revenue, Members encouraged Armenia to continue its efforts to control the illicit trade in tobacco products.

In conclusion, Armenia has provided answers to all of the written questions submitted before the deadline and nearly all of those submitted after it. This TPR will be successfully concluded in a month's time when Armenia has replied to all outstanding questions and any follow-up questions that emerged during our meeting. I sincerely hope that the discussion held during this Review will prove useful to Armenia in the continued implementation of economic and trade reforms and in its pursuit of policies to achieve sustainable growth.

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