Kherobyan on the Impact of Anti-Russian Sanctions on Armenia's Economy

Armenia's Minister of Economy Vahan Kherobyan discussed the impact of anti-Russian sanctions on Armenia's economy in an interview with Vedomosti.

According to him, Russia is Armenia's key economic partner, and it is very difficult to hope for better outcomes without free trade with them.
“In addition, Armenia is a member of the EAEU, so we fundamentally cannot support the sanctions,” he said.

He recalled that several Armenian companies were subjected to secondary sanctions in 2022.
“But from the very first day of the restrictions, our banks have installed strong filters for opening accounts and making settlements, acting somewhat excessively strict in a way. And that is what is happening,” he stated.

“We have been in contact with dozens, if not hundreds of businesses that have faced difficulties, but they have managed to find a bank willing to serve them,” he explained.

Regarding the difficulties with transactions between countries, Kherobyan assured that there are virtually no technical problems.
“After Russian banks disconnected from SWIFT, Armenian organizations started to join a similar mechanism for transfers from Russian banks – the financial messaging transfer system,” the minister said.
Now all banks have connected to it, except for a few foreign institutions.

“In the current circumstances, the main difficulty is not the technical processing of payments. We are much more concerned about the exchange rate at which trade is conducted,” he said.

Kherobyan noted that the amount of money transfers between Russian and Armenian banks for individuals increased more than fourfold last year, reaching $3.6 billion in nominal terms.
“These have mostly been carried out through the financial messaging transfer system of the Bank of Russia. As you know, our central banks are now working on creating additional payment methods. In particular, the use of rapid payment systems is being tested. As far as I understand, this concerns the integration of the Russian system with Armenian ArCa. In addition to individuals, companies will also be able to benefit from this,” he clarified.

Speaking about the Russian “МИР” card, the minister indicated that Armenian banks independently decide whether or not to serve their Russian cards. According to him, so far, none of them have refused to serve those cards, except for foreign organizations like HSBC.

“I read in Russian media that complaints have arisen about the non-acceptance of 'МИР'. I can assure you that I am trying to follow the situation and I haven’t heard about such problems so far. There are processing interruptions, but at that time, difficulties arise not only with 'МИР' but also with payments of Armenian cards,” Kherobyan concluded.