This is Armenia EITI 2018 Annual Progress Report (in accordance with Requirements 7.4 and 8.4).
The metal mining sector is an important contributor to the Armenia’s economy and is one of the fastest-growing sector in the country’s largely agricultural economy. In 2017, the taxes and payments paid by the metal mining companies to the State budget reached approximately USD 18bn or 7.1% of total incomes. The mining and quarrying sector contributed to 3.2% of GDP in 2017. The country’s mineral resources include iron, copper, molybdenum, lead, zinc, gold and silver.
Currenty, there are 10 major mining and metallurgical companies in operation out of over 25 registered, mainly concentrated in two provinces. Currently the biggest mine is operated by the Zangezur Copper-Molybdenum Combine CJSC, located in Kajaran (Syunik province).
Armenia implements the EITI to attract foreign investment in the mining sector, bring accountability and transparency into the sector and enable public access to reliable information. By fostering cooperation between government, businesses, and civil society, the EITI has helped to introduce a new culture of dialogue in Armenia.
A beneficial ownership roadmap was published in December 2017. In April 2019, Armenia adopted a package of amendments to the relevant legislation that ensured mandatory disclosure of beneficial owners of metal mining companies starting from 2020. In February 2020, the beneficial ownership declaration form has been published, and the first round of the beneficial ownership disclosures has been completed. Currently, Armenia is working on establishing a beneficial ownership register that will help the country to transition to systematic disclosure of beneficial ownership information.
Source: EITI Armenia
Copper is the main mineral for Armenia’s mining sector which contributed to 26.6% of total exports from Armenia in 2017. The country also produces significant volumes of molybdenum, ferromolybdenum, zinc as well as gold and silver alloy.
|Commodity||Volume of production (2017)||Value of production (2017)||Exchange rate (2017)|
|Copper ore and concentrate||459,273 wmt||134,788m AMD||1 USD = 480.629 AMD|
|Molybdenum concentrate||2,303 wmt||4,378m AMD|
|Ferromolybdenum||6,519 ton||29,585m AMD|
|Zinc ore and concentrate||10,869 ton||4,104m AMD|
|Gold and silver alloy||60,010 gram + 139,839 ounce||153m AMD + 55,152m AMD|
Metal mining companies pay royalty, value added tax, income tax, profit tax, custom duties and fees, rent payments and a number of other taxes and payments to the State and local budgets.
In 2017 the taxes and payments paid by the metal mining companies to the State budget were equal to AMD 87.1bn (USD 0.18bn) or 7.1% of total incomes.
According to Armenia’s 2016-2017 EITI Report, the amount of taxes and payments paid by metal mining companies to the community budgets in 2017 amounted to AMD 1.3 bn (USD 2.73m) or appoximately 1% of total community budgets.
Taxes and payments paid to community budgets by metal mining companies are primarily derived from property leases, which form approximately 66% of total taxes paid to the community budgets in 2017.
The establishment of an e-reporting platform, which also serves as a data portal, was an important stepping stone towards facilitating collaboration between stakeholders and moving to systematic dislosure of information about the metal mining sector. The portal not only lessens the reporting burden for companies by making it easier to report but also makes data more accessible to citizens in open data formats.
Armenia joined the EITI in March 2017 with the aim of leveraging natural resource transparency to promote economic growth and poverty reduction. In 2018, the new government became actively engaged with EITI implementation and committed to undertake systemic institutional and legal reforms, emphasising as an important breakthrough the preparation of the country’s first EITI Report. The government has also expressed its support to establishment of a public beneficial ownership register.
In 2018, Armenia launched an online reporting system for industry and government agencies to electronically collect and disclose EITI data. Armenia’s first EITI Report was published in January 2019 and covers 2016 and 2017 fiscal years.
Armenia has also identifies responsible mining as a national priority for the mining sector and created a working group focusing on this topic. In addition, comprehensive information about environmental payments that are paid by metal mining companies and distributed to the affected communities can be found on the national EITI website.
Currently, the EITI process in Armenia is lead by Deputy Prime Minister Tigran Avinyan. An overview of the country's priorities can be found here.
Source: EITI Armenia