Armenia profile

Demography and Health

Armenia is a small country with a population of about 3.03 million in 2024, reflecting a nation with a comparatively dense cultural footprint despite its modest geographic footprint. Life expectancy at birth stands at 77.5 years in 2023, indicating relatively strong health outcomes for a country at its income level. The birth rate is 12.3 per 1,000 people in 2023 while the death rate is 8.2 per 1,000 people in 2023, pointing to a positive natural increase that supports a stable population base but will, over time, be influenced by migration and aging. The under-5 mortality rate is 10 per 1,000 live births in 2023, suggesting ongoing improvements in child health and access to essential services, though this indicator still highlights room for further progress. Armenia spends about 9.96 percent of GDP on current health expenditure in 2022, with domestic government health expenditure per capita (PPP) around 314 international dollars in 2022, showing a substantive public commitment to health relative to its income level. Poverty remains a significant challenge, with 24.8 percent of the population under national poverty lines in 2022, while undernourishment is relatively low at 2.5 percent in 2022, indicating food security is improving but not uniformly distributed. Digital connectivity is strong, with about 80 percent of the population using the Internet in 2023, which supports health information access, telemedicine potential, and broader dissemination of public health campaigns. Governance indicators show a mixed picture: regulatory quality is modest at 0.0476, control of corruption at 0.0584, but political stability and absence of violence/terrorism is negative at -0.829 and government effectiveness at -0.184, signaling ongoing public governance challenges that can influence health policy implementation and service delivery. Suicide mortality is low at 2.46 per 100,000 in 2021, complementing a generally favorable health profile. Taken together, Armenia exhibits solid life expectancy and child health outcomes, a meaningful public health spending footprint, and notable poverty and governance challenges that interplay with migration patterns to shape the health and demographic outlook.

Economy

Armenia presents a small, open economy with a 2024 GDP per capita (current US$) of about 8,501 and a PPP-adjusted per-capita figure of roughly 22,823, suggesting higher purchasing power when adjusted for cost of living and a diversified set of consumer and investment possibilities. Price stability is evident in 2024 with inflation at a very low 0.27 percent, a favorable condition for domestic demand and investment planning. The economy is notably export-oriented, with exports of goods and services accounting for 76.3 percent of GDP in 2024, while imports represent 75.8 percent of GDP, indicating deep trade integration and exposure to global cycles. This openness aligns with Armenia’s emergence as a hub for certain high-value activities, supported by substantial high-technology exports totaling about 0.88 billion USD in 2024, underscoring a specialization in tech-driven goods. Yet the R&D intensity remains modest at 0.181 percent of GDP in 2023, signaling a need to scale innovation could drive productivity and growth. Net inflows of foreign direct investment amount to 0.537 percent of GDP in 2024, reflecting a favorable but still developing investment climate. The current account shows a deficit of 3.87 percent of GDP in 2024, indicating that external financing remains a consideration for macro stability. The unemployment rate sits at 8.42 percent in 2021, suggesting a reasonably solid labor market for a minority-led economy, though ongoing employment gains would support inclusive growth. In sum, Armenia’s economy blends openness, modest inflation, and a growing tech export base with opportunities to deepen investment, widen innovation, and manage external vulnerabilities.

Trade and Investment

Armenia’s trade profile is distinctly open, with exports of goods and services representing 76.3 percent of GDP in 2024 and imports at 75.8 percent of GDP, indicating a highly trade-reliant economy integrated into regional and global value chains. The country achieves a notable share of high-technology exports, totaling approximately 0.88 billion USD in 2024, signaling a technology-oriented export trajectory. The Logistics Performance Index stands at 2.6 (2022), reflecting mid-range quality of trade and transport-related infrastructure that supports current level of trade but points to potential efficiency gains to attract more investment and reduce costs. Foreign direct investment net inflows amount to about 0.537 percent of GDP in 2024, signaling a cautious but positive investor stance, with scope for improvement through governance reforms and targeted incentives. The current account deficit of 3.87 percent of GDP suggests ongoing dependence on external capital, which will be sensitive to global financing conditions and growth in export demand. Considering these indicators together, Armenia demonstrates strong trade openness and a growing tech export segment, but achieving faster growth will likely require bolstering transport and logistics efficiency, improving the investment climate, and expanding capacity to finance the current account gap through durable capital inflows and remittances.

Governance and Institutions

Armenia’s governance landscape presents a mix of strengths and vulnerabilities. Political stability and absence of violence/terrorism is relatively weak in the current readings, with a score of -0.829 in 2023, signaling exposure to political risk and regional tensions that can affect policy continuity and investor confidence. Regulatory quality is modestly positive at 0.0476, indicating some capacity to implement and enforce rules that support market activity, while the rule of law sits at -0.122, highlighting gaps in legal predictability and enforcement that can undermine contract rights and property protections. Control of corruption registers at 0.0584, suggesting some anti-corruption progress but not a high-impact safeguard, and government effectiveness is -0.184, pointing to limited public sector performance in policy delivery and service provision. Together, these indicators imply that Armenia faces governance challenges that could constrain business environment improvements and investment. Nevertheless, Armenia benefits from a resilient public sector in other areas such as health and digital inclusion, which can serve as platforms for reform. Policy priorities would include strengthening the rule of law, improving public sector effectiveness, and reducing corruptions’ opportunity costs to attract investment and support long-run development goals.

Infrastructure and Technology

Armenia shows a developing technology and infrastructure profile with notable strengths and gaps. Internet usage is high, with about 80 percent of the population online in 2023, enabling digital services, e-government, and online education. High-technology exports total roughly 0.88 billion USD in 2024, suggesting the emergence of niche tech capabilities and integration into regional value chains. However, domestic research and development spending remains low at 0.181 percent of GDP in 2023, pointing to limited innovation push from both the private and public sectors. Patent activity from residents is modest at 40 applications in 2021, indicating room to scale inventive output and commercialization. The Logistics Performance Index is 2.6 in 2022, signaling mid-range logistics that could benefit from targeted investments to reduce trade costs and improve supply-chain reliability. Renewable energy accounts for 9.1 percent of total final energy consumption in 2021, showing an energy transition trajectory but with substantial headroom for expansion in hydropower, solar, and wind. Overall, Armenia’s infrastructure and technology landscape combines strong digital connectivity with emerging high-tech capabilities and the opportunity to accelerate innovation, energy diversification, and logistics efficiency through targeted reform and investment.

Environment and Sustainability

Armenia faces environmental and sustainability challenges that require policy attention and investment. The level of water stress is high, with freshwater withdrawals at 59.9 percent of available resources in 2021, underscoring pressure on water resources and the need for integrated water management, efficiency measures, and potential pricing reforms to align use with scarcity. Per-capita greenhouse gas emissions are about 3.66 tonnes of CO2 equivalent in 2023, reflecting a moderate climate footprint for a small economy and signaling opportunities to pursue cleaner growth through energy efficiency and a shift toward low-emission power sources. Renewable energy consumption stands at 9.1 percent of total final energy use in 2021, indicating movement toward cleaner energy but leaving substantial room for rapid expansion, particularly in hydropower, solar, and wind given Armenia’s geographic and resource context. Addressing water security, expanding renewables, and investing in climate-resilient infrastructure could yield co-benefits for development, health, and economic diversification, while also helping Armenia lower its emissions intensity and improve long-term environmental resilience.