Which Armenian companies may fall into Russia’s ‘black list?’

There is no black list yet but the recent trends show that in case of certain geopolitical changes there may be one. Pessimists are bringing the example of Ukraine, which is faced with a situation similar to Armenia’s. Since August 14 the Russian government has declared almost all Ukrainian export to their country risky. Hundreds of trucks are waiting in line at the border. Ukrainians and others believe that Russia has started a trade war with them. Earlier, the Russian food safety board prohibited import of Roshen company’s products. This was followed by a ban on the import of Nemiroff, Khortitsa and other brands. Experts believe this drastic change in Russia’s policy has the goal to make Ukraine change its policy to give up on the association agreement with EU and join Eurasia Union.

Furthermore, the Russian president’s advisor Sergei Glazev says the ban on Ukrainian products was a trial of the punishing hand. He said that such customs policies might be applied to Ukraine in case of signing association agreement with EU. He also warned that the check-up of Ukrainian products by customs service was one-time action, and it could become established policy in case Ukraine signs association agreement with EU.

How does it relate to Armenia? There is direct connection. Armenia is going to sign association agreement and they want to force Armenia join the Customs Union, too. There have been threats addressed at Armenia too (for example, by Putin and Zatoulin). Threats addressed at Ukraine are warning for Armenia, thus it is not excluded that one day Russia may close its doors for Armenian products by considering the risky or finding some inconsistency in the quality. The example of Ukraine shows that mainly large companies are targeted. If we assume that such scenario can be used against Armenia, too, which Armenian companies will be targeted? In order to understand this question, we should analyze the structure of Armenian export to Russia.

According to the state incomes customs body, in 2012 Armenia exported products worth of 280 million dollars to Russia. Half of the export (49.1%) is alcoholic drinks. Armenia does not export vodka to Russia. Wine export covers 1.1% (3 million). This means that the main product exported to Russia is cognac. The main companies that may be targeted are the ones involved in cognac, diamond, agricultural, cigarette and fish production. In consideration of these sectors, we have made a list of Armenian companies involved in the sectors above, which may be targeted by Russia in case of foreign policy change in the near future:

Proshyan Cognac Factory (cognac and wine production/export)

Avshar Wine Factory (cognac and wine production/export)

Yerevan Ararat Cognac-Wine-Vodka Factory (cognac and wine production/export)

Yerevan Cognac Factory (cognac and wine production/export)

Shahnazaryan Wine-Cognac House (cognac and wine production/export)

Armenia Wine Factory (cognac and wine production/export)

Yerevan Champagne Wine Factory (cognac and wine production/export)

Vedi Alco (cognac and wine production/export)

Stepanakert Cognac Factory (cognac and wine production/export)

Ijevan Wine, Cognac Factory (cognac and wine production/export)

Great Valley (cognac and wine production/export)

Agates Diamond Production Enterprise (diamond production/export)

Andranik Diamond Production Enterprise (diamond production/export)

Thermotoun/Bakas Ltd (fish production/export)

Spayka (export of fresh fruit)

Eurotherm CJSC (export of fruit and vegetables)

Meghri Cannery CJSC (export of fruit/vegetable cannery)

Arzni Group Mineral Water Company (export of fruit/vegetable cannery)

Alishan Cannery (export of fruit/vegetable cannery)

Armen-Hamik Brothers Ltd (export of coffee)

Royal Armenia (export of coffee)

Grand Tobacco (cigarette production/export)

International Masis Tabak (cigarette production/export)

By Babken Tunyan