Reorienting Armenian exports to alternative markets could mitigate Russian restrictions (EXCLUSIVE)
YEREVAN, June 17. /ARKA/. Armenia's ability to reorient its agricultural products from Russia to other markets will partially mitigate the impact of restrictions on Armenian exports to Russia, economist Grant Mikaelyan told the ARKA news agency.
The day before, Central Bank of Armenia Chairman Martin Galstyan noted that Russia's import restrictions on certain Armenian goods could cost the Armenian economy approximately 2% of GDP. ARKA asked economist Grant Mikaelyan for comment on the potential risks to the country's economy.
According to Mikaelyan, at first glance, the 2% figure does not appear critical for a number of reasons.
First, part of this year's harvest has already been damaged by unfavorable weather conditions, including hail and spring frosts. Consequently, production volumes were already expected to be below normal levels.
Secondly, some of the production—80-85%—remains on the domestic market, with only 15-20% exported. This prevents a complete loss of economic activity, although it is accompanied by a significant drop in prices for producers.
Finally, Armenian companies are trying to find alternative export destinations. While it's impossible to completely replace the Russian market in the short term, a partial reorientation could mitigate the consequences.
"I think the macroeconomic impact will be limited for now. But the impact on households, producers, and small and medium-sized businesses will be quite significant," the expert believes.
Agricultural Complex Most Vulnerable
According to Mikaelyan, the most affected sector will be the agricultural complex.
This applies not only to fruit, vegetable, and flower producers, but also, in particular, to alcoholic beverages and mineral water, which are traditionally oriented toward the Russian market.
"We don't know how widely the instruments for restricting trade between Armenia and Russia will be used. "Restrictions on apricots and flowers are one aspect of the situation, but there are also mineral waters, alcohol, and re-exports, which are very significant and have contributed to Armenia's GDP growth in recent years," Mikaelyan said.
However, he did not rule out the possibility of a paradoxical situation in which Russia, while restricting Armenian exports, does not restrict re-exports, the volumes of which, in his opinion, will be quite significant.
Most vulnerable sectors
Mikaelyan did not rule out that, in addition to the agro-industrial complex, industrial production and agriculture—production and processing—could also be affected. Next in line, in his opinion, could be the textile sector. There is also the possibility of restrictions on labor from Armenia, which would increase pressure on the Armenian labor market.
"At the moment, one can only assume that the restrictions will affect agriculture, agricultural processing, and possibly light industry. But in the long term, of course, finance and logistics could also suffer," the economist believes.
Restrictions on the supply of products from Armenia to Russia
Effective June 12, 2026, Russia has restricted the import of all quarantine products originating and shipped from Armenia, as well as their transit through Russia to EAEU member states.
The restrictions imposed by Rosselkhoznadzor (the Federal Service for Veterinary and Phytosanitary Surveillance) include, among other things, vegetables, fruits, herbs, and flowers. Previously, Russian regulators also imposed restrictions on the supply of Jermuk mineral water and certain types of alcoholic beverages from Armenia.
Rosselkhoznadzor cited the "systematic detection of quarantine organisms" in plant products and flowers from Armenia as the reason for the restrictions. It is noted that the ban will remain in effect until a specific algorithm for ensuring the safety and traceability of shipped goods is developed.
