September 11, 2020 - 15:27 AMT
PanARMENIAN.Net - Armenia presents a variety of opportunities for investors, and the competitive environment is improving but some challenges remain, the U.S. Department of State said in its recent assessment of the investment climate in Armenia.
The report said that over the past several years, Armenia has received respectable rankings in international indices that review country business environments and investment climates.
Among obstacles, the Department said, are the country's "small market size, relative geographic isolation due to closed borders with Turkey and Azerbaijan, weaknesses in the rule of law and judiciary, and a legacy of corruption."
Net foreign direct investment inflows are low, said the report.
"Armenia imposes few restrictions on foreign control and rights to private ownership and establishment. There are no restrictions on the rights of foreign nationals to acquire, establish, or dispose of business interests in Armenia. Business registration procedures are straightforward," the U.S. government added.
According to foreign companies, however, otherwise sound regulations, policies, and laws are sometimes undermined by problems such as the lack of independence, capacity, or professionalism in key institutions, most critically the judiciary.
Also, the report said, Armenia does not limit the conversion and transfer of money or the repatriation of capital and earnings. The banking system in Armenia is sound and well-regulated, but investors note that the financial sector is not highly developed.
Overall, the Department added, the competitive environment in Armenia is improving, but several businesses have reported that broader reforms across judicial, tax, customs, health, education, military, and law enforcement institutions will be necessary to shore up these gains.