Brussels, 25/07/2013 (Agence Europe) - As part of an association agreement to strengthen Armenia's political links with the EU, the newly concluded free-trade area should increase Armenian GDP by over 2%.
After seven rounds of negotiations, the EU and Armenia concluded their negotiations (started in May 2012) for a free-trade area on 24 July. This area will form part of the association agreement - under negotiation since July 2010 - to broaden the scope of bilateral cooperation which has been governed by a partnership and cooperation agreement since July 1999 (see EUROPE 10557). Brussels and Erevan hope to initial the association agreement at the Eastern Partnership summit in Vilnius in November.
Armenia - which already enjoys preferential access to the EU market through the GSP+ system, will obtain better access to the European market for its goods and services. However, gains will especially result from the removal of non-tariff barriers. The regulatory reform in Armenia will focus on sanitary and phytosanitary issues in order to bring the Armenian standards on food safety closer to those of the EU. Armenia will also have to adapt its legislation on industrial goods, putting emphasis on consumer protection.
According to an independent study, the free-trade area between the EU and Armenia should stimulate growth in exports by 8.2% and 15.2% respectively. The agreement could increase Armenia's long term GDP by 2.3% - or €146 million. The EU is estimated to stand to gain €74 million.
Accounting for of 32% of Armenia's trade, the EU is Armenia's biggest trade partner. Bilateral trade in goods was worth €951 million in 2012. (EH/transl.fl)