Armenia to increase cement import levy

Armenia’s government is taking measures to protect domestic cement producers from competition by cement producers in neighbouring countries.

The state policy of subsidising the cost of gas and electricity in Armenia’s neighbours has led to a rise in more competitively-priced imports into Armenia. As result, output volumes at Armenia’s cement plants, Ararat and Hrazdan, have significantly decreased. Around 2Mta of product is currently stored in warehouses with only one-third sold. In January-September 2018, production reached 401,000t, when compared with 251,000t in the 9M17.

Therefore, the Minister of Economic Development and Investments, Tigran Khachatryan, is proposing to raise the tax on imported cement to AMD23,000/t (US$47.07/t).

Prime Minister, Nikol Pashinyan, highlighted the need for the measure to protect the country’s cement producers: "Making a decision, we thereby protect the domestic market and create conditions for the development of the urban planning sector.”

In addition, one of Armenia’s cement plants has carried out a programme to improve energy efficiency and as a result, the plant’s energy cost fell from AMD41,000/t to AMD36, 200/t. The company intends to implement further improvements this year.