Investments still haven’t flowed into Armenia
October 31 2025, 18:00
There is virtually no foreign direct investment (FDI) in Armenia. From January to June of this year, the volume of FDI amounted to just 5 billion drams—a notably low figure for a six-month period.
A decline in investment flows from Russia, the UAE, and Cyprus has been recorded. The most significant drop was in FDI from Russia. In effect, Armenia has lost its investment appeal.
In theory, several key factors shape the investment climate and, consequently, influence investment attractiveness: the business environment, tax system, judiciary, political stability, and security. We face challenges in nearly all of these areas. Nevertheless, the trends of recent years paint an interesting picture.
First, FDI inflows during the specified period have decreased threefold compared to 2017. In 2018, there was a brief surge in activity, likely driven by optimistic expectations following political changes, but this was followed by a decline due to subsequent disillusionment.
Significant activity was observed in 2022-2023, largely due to the Russia-Ukraine conflict and the resulting capital outflow from Russia to Armenia. However, by 2024, a negative trend emerged. This issue had been raised earlier, with concerns expressed that a capital outflow from Armenia could not be ruled out.
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