Ease of Doing Business Rank: 47
Armenia is a landlocked country in the mountainous Caucasus region between Asia and Europe. Georgia lies to the north, Turkey to the west, Iran to the south and Azerbaijan to the east.
Armenian is the official language of the country, spoken by the majority of inhabitants. Minority languages include Assyrian, Greek, Russian and Kurdish.
Russian is the most commonly spoken foreign language, spoken by approximately 70% of the population as the country was previously a Soviet state. English is sometimes spoken in the service industry, business and government.
The 2019 population estimate is 2.95 million.
Yerevan is the capital and largest city (1.07 million). Gyumri is the only other city with a population over 100,000. The remaining population lives in small cities, towns or villages.
The top industries in Armenia are mining, chemicals, electronic products, machinery, processed food, synthetic rubber, textiles, agriculture, financial services, hi-tech and construction.
The Times Higher Education World Rankings does not include any Armenian universities in their report.
The Legatum Prosperity Index ranks Armenia’s education system 48th out of 149.
The most common type of business entities in Armenia are the private entrepreneur, limited liability company, joint stock company and partnership.
The overwhelming majority of businesses are in the form of a limited liability company.
Qualifying companies involved in export of goods and services may enjoy a reduced corporate tax rate. This includes a maximum reduction to 2% for large-scale exporters (General rate 20%).
Resident companies implementing special construction projects outside Armenia may qualify for a 5% corporate tax rate. As well, companies involved in agricultural or handmade carpet production may enjoy a tax holiday.
Armenia also has several free economic zones. Licensed businesses are exempt from profit tax, value added tax, excise tax and customs fees, but pay income tax.
Each economic zone focuses on specific sectors. The newest will cater to production, high-tech and blockchain, while existing areas focus on pharmaceuticals, jewelry and watchmaking, agriculture, manufacturing, trade, cargo shipment and storage.
Armenia also offers a salary discount to qualifying companies of up to 30% of calculated CIT for the creation of new jobs. The incentive applies to the startup year and the following five fiscal years.
The country also provides foreign tax credits to companies to offset their tax payable within the region.
Yerevan is the most economically developed city in Armenia and the financial center of the country.
Armenia offers history, culture, and natural beauty, including stunning Mount Ararat. It is believed Noah’s Ark is embedded in ice somewhere on the peak and one explorer claims to have found it.
The country also includes 3 UNESCO World Heritage sites, including the Monasteries of Haghpat and Sanahin. These two Byzantine monasteries were built between the 10th and 13th century as important centers of learning. Sanahin schooled illuminators and calligraphers and both monasteries are prime examples of Armenian religious architecture at its peak.
Yerevan Cascade in the capital city is a giant staircase surrounded by art museums, gardens, and waterfalls. The ornately-decorated Blue Mosque in the center of the city spans 75,000 square feet and is the biggest in the region.
The Temple of Garni was built in the first century AD, prior to Christianity. It is the only standing Greco-Roman colonnaded building in Armenia and the former Soviet Union.
The Matenadaran Museum has the world’s largest repository of ancient manuscripts. Holdings include over 23,000 manuscripts and 30,000 documents in 2,000 languages.
Nature lovers head to Lake Sevan. It is the largest body of water in the Caucasus region and one of the largest alpine lakes in Eurasia. It is very popular with Russian tourists and for day trips, due to its picturesque beaches.
Armenia also holds mysteries, including Karahunj. This collection of 200 stones with holes drilled through the center sits high plateau and defies analysis. Some suggest it was built in the 6th century BC as a celestial observatory. Not far away, you’ll find Khndzoresk, a city of giant caves where people dwelt until the 1950s.
In the Kotayk region, Garni canyon features symmetrical basalt columns locals call ‘the symphony of stones’. From a distance, the formation resembles a giant pipe organ.
Armenia is one of the world’s oldest civilizations. Sumerian and Akkadian manuscripts and the Bible suggest the Garden of Eden was in the Armenian Highlands.
The first mention of the country was in the late 6th century BC when a dynasty ruled the independent Kingdom of Armenia. At its zenith between 95 BC and 65 BC, the kingdom extended from the Caucasus through to present-day central Turkey, Lebanon and northern Iran.
By 301 AD, Armenia became the first sovereign nation to accept Christianity as a state religion. The area later fell to Byzantine, Sassanid Persian and Islamic powers.
The Armenians regained power, but the kingdom fell in 1045 and were subsequently overtaken by the Seljuks in 1064. However, the Armenians established the Kingdom of Cilicia in an Anatolian region. Even though they developed ties with Christian states, they were overcome by Turkish federations.
From the early 16th century onwards, rival Iranian and Turkish powers fought over many Armenian regions. This led to Iranian rule over Eastern Armenia and Ottoman rule over Western Armenia. In the late 1820s, Eastern Armenia was incorporated into the Russian Empire after the Russo-Persian War. Western Armenia remained in Ottoman hands.
During World War I, Christian Armenians suffered greatly under Ottoman rule. Between 1915 and 1918 the Armenian Genocide killed an estimated 1.5 million victims.
After World War I, Armenia briefly enjoyed independence. However, communist powers invaded Armenia in 1922. The region became part of the Soviet Union, and later the Armenian Soviet Socialist Republic. Armenia finally achieved independence in 1991 after the dissolution of the Soviet Union.
Today, Armenia is a democratic republic with a mixed market economy.
According to the 2011 census, almost all inhabitants identify as Armenian (98.1%), followed by Yezidi (1.1%) or other ethnicities (0.7%).
The majority of the population claims Armenian Apostolic as their religion (92.6%), followed by Evangelical (1%) or other religions (2.4%).
According to Forbes’ 2019 Best Countries for Business, Armenia is the 81st best country in the world for conducting business.
The 2019 Index of Economic Freedom rates Armenia 47th globally and states, “Despite the previous government’s efforts to improve the business environment through tax reform, reduce corruption in the customs and tax administrations, and increase the transparency of procurement processes, Armenia’s geographic isolation, narrow export base, and pervasive monopolies in important business sectors make it particularly vulnerable to deteriorations in global commodity markets.”
World Bank’s “Doing Business” rankings rate Armenia 41st for ease of doing business in the world.