Monday, May 12, 2008

Armenia-Iran trade relations

The US State Department recently released its 2007 Country Reports on Terrorism. The Armenia section states that:

Armenia’s warming relations with neighboring Iran continued, with Armenia hosting official visits by Iranian President ... In addition to fostering closer diplomatic ties, these visits served to solidify previous bilateral commitments to develop joint energy and transportation projects ...

This is odd. Armenia imported only $133 million in goods from its large southern neighbor Iran in 2006, or 6 percent of its total imports. Combined with exports of $29 million, Iran accounts for 5 percent of Armenia's total trade. Obviously the country has weak economic relations with Iran, and the latter accounts for little of its imports and trade relations.

Even if trade relations were to increase as the report suggests, these would be small and most likely would be energy related and displace imports from Russia. In any event, the country not only imports little but there has been little growth over the past 10 years where they grew from $89 million in 1997 to $133 million in 2006. Interestingly, Turkey imported $4.5 billion of goods from Iran, up from $600 million in 1997. I wonder where State gets its data. I would very much hope that they do not rely on the incompetent reporters at rfe/rl. I have written on the subject last year (see here)!