Country Profile

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Overview

Since 1992, USAID has worked to support Armenia’s transition into a stable partner, at peace with its neighbors, that respects principles of democracy and offers citizens equal opportunity to enjoy the benefits of sustained economic growth. Armenia’s location at the crossroads of Europe and Asia, as well as the strong ties between the American and Armenian people, make the country’s stability and prosperity an important U.S. interest.

Armenia’s development progress since independence has been uneven. The country’s closed borders with Turkey and Azerbaijan due to unresolved regional conflict, weak governing institutions, and pervasive corruption have hindered its transition to a market economy. The shock of the Georgia/Russia conflict in August 2008 was a wake-up call to Armenia’s economic fragility and isolation. Adherence to democratic principles worsened in 2008 with the Government of Armenia’s retaliation against political opponents and restriction of fundamental freedoms. The global financial and economic crisis poses new challenges for Armenia, while simultaneously threatening to roll back economic gains of the past. In response, USAID will increase assistance to strengthen civil society, increase access to objective information, and promote political pluralism. USAID will advocate for more effective and transparent economic governance and support to build the competitiveness of key industries. USAID will also deepen efforts to advance sustainable health and social welfare reform and will foster energy and trade linkages through cross-border initiatives.  

Programs

INCREASING ARMENIA’S COMPETITIVENESS

Despite Armenia’s steady economic growth in recent years, the benefits of development are not reaching many citizens who continue to live in poverty. USAID addresses this problem by strengthening the foundations for economic growth through an improved business and policy environment, promoting adoption of commercial laws, enhancing the competitiveness of key industries, assisting in tax system modernization, and promoting the growth of micro, small, and medium enterprises through capacity building and increased access to financing and new markets.

STRENGTHENING DEMOCRATIC GOVERNANCE

Armenia’s road to democracy has been hampered by a dominant executive branch, citizens who are still learning their roles and responsibilities in a democratic system, and corruption. In response, USAID works to strengthen democracy and transparency in all levels of government, promote the rule of law, increase public awareness about human and civil rights, train non-governmental organizations and youth in advocacy, help core and alternative media become more professional and less reliant upon political sponsorship, and increase civic participation in local governance and anti-corruption initiatives. 

ENSURING ENERGY SECURITY

Although Armenia’s power supply has become more reliable in recent years, its energy sector remains vulnerable. Armenia depends on imported gas and nuclear fuel to meet approximately 70 percent of its energy needs. Its own nuclear power plan, which provides 42 percent of the nation’s electric power, is considered unsafe and scheduled for retirement in 2016. Building upon past energy sector reform efforts, USAID is launching a new activity to promote energy security by securing diversified sources (including nuclear and renewable) and investment to ensure efficient and economically sustainable usage in national and regional contexts.

INCREASING ACCESS TO PRIMARY HEALTH CARE

While the Government of Armenia has stepped up efforts to improve the primary health care (PHC) nationwide, state financial support for health is still inadequate and institutional capacity gaps persist at all levels of Armenia’s healthcare system. In response, USAID helps strengthen the government’s institutional capacity for PHC reforms, reinvigorates provision of and access to quality reproductive, maternal, and child healthcare services across the country, improves the clinical and management skills of providers, strengthens referral and quality assurance systems, and implements public education programs.

PROTECTING THE SOCIALLY VULNERABLE

Since the collapse of the Soviet Union, Armenia has had difficulty providing social benefits to its most vulnerable citizens. USAID works with the government to implement social protection (particularly pension) system reforms and ensure that adequate benefits are fiscally sustainable. USAID also supports labor market interventions aimed at providing support to the vulnerable population and jobless individuals (including the low-skilled, women, and the disabled), giving greater attention to countering the effects of the current global economic crisis.