The immediate post-Soviet years in the 1990s brought an energy crisis to Armenia, and the country’s rulers had to start seeking creative solutions for a country with no proven reserves of oil and gas. “With each crisis, we sought opportunity,” says Ashot Manukyan, Armenia’s minister for energy infrastructures and natural resources.

– Ashot Manukyan, Minister of Energy Infrastructures and Natural Resources

Manukyan points out that today there are no problems with power supply for Armenian homes and industry, but challenges do remain, which the government is tackling on three major fronts. The first is investing in improvements in the existing energy infrastructure, notably the $300 million upgrade to Armenia’s nuclear power plant to extend its lifecycle. Second is bringing in more targeted investment to boost new sources of power, especially hydro and solar energies. Third, the government is completing its bold liberalisation of the electricity market, with increased competition and more cross-border trade.

“The process has started and the new market model will operate fully in 2019,” Manukyan explains. “We will be moving from the ‘single-buyer’ model to a liberal one. We will need experienced traders and suppliers to come and operate within the new market rules.”

Armenia’s government believes that renewable sources, led by solar, midsize hydropower plants and wind turbines, will provide 50% of the country’s energy needs in the coming years. Investment from GCC companies is viewed positively in the energy sector, with Access Power from the UAE currently bidding in an auction for a solar plant and also investing in a wind project. A memorandum of understanding was signed in 2017 between Armenia’s Ministry of Energy and the company Ocean Holding in Abu Dhabi, concerning a $100 million investment in solar plants with a total capacity of 100-120 MW.

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Armenia is already exporting electricity to Iran under a deal that sees gas flow in the other direction. Meanwhile, Gazprom Armenia distributes natural gas from Russia, and the company recently finalised a $67 million investment plan to improve supply and storage infrastructure.

Armenia’s mining sector also offers an abundance of opportunities for inward investors, with copper, molybdenum and gold leading an industry that accounts for 25% of the country’s total export revenues.

According to Manukyan, “there are still dozens of fields with identified metallic mineral reserves, including copper, gold, zinc, and iron”. Lydian International literally struck gold after investing more than $400 million in the Amulsar deposit, where production of the precious metal is due to start later in 2018.

But after extracting minerals come trade and logistics. “We believe that cooperation with UAE is important for our land-locked country,” says Mger Poloskov, general manager of ZCMC, Armenia’s leading metal-mining company. “In our everyday work, we see the necessity of deepening trade and financial cooperation with the countries of the Persian Gulf, as this is an important hub for transportation – products are shipped from Armenia to the Gulf region and other countries, and back towards Armenia.”