Vardan Urutyan GLOBAL FOOD POLICY REPORT Transforming Food Systems after COVID-19: Implications of the 2021 Global Food Policy Report for Eurasia Co-Organized by the Eurasian Center for Food Security at Lomonosov Moscow State University, Westminster International University in Tashkent, Armenian National Agrarian University, the World Bank, & IFPRI MAY 27, 2021 - 07:30 AM TO 09:00 AM EDT

1. IMPLICATIONS OF THE 2021 GLOBAL FOOD POLICY REPORT FOR EURASIA REGION
THE CASE OF ARMENIA
Vardan Urutyan, PhD
Rector, ANAU
Yerevan, 2021

2. Armenia suffered a severe COVID-19 outbreak,
ranking 27th globally in recorded cases per
million population.
The conflict with Azerbaijan escalated
dramatically in September 2020 ending with 44-
day war with catastrophic circumstances.
Armenia’s progress in transforming food systems was derailed
in 2020 by double shocks:
…and
domestic
political
instability
…and ongoing
climate change
induced weather
shocks.

3. Confirmed New COVID-19 Cases in Armenia, Daily, in Persons.

4. Macroeconomic Picture - 2020
• Armenia’s GDP dropped by 7.6% in 2020.
• The fiscal deficit widened to around 5.5% of GDP in 2020, with government debt ending 2020
at about 63.5% of GDP.
• Poverty rate reached 26.4% of the population. Almost 11% of the poor are ‘extremely’ or ‘very’
poor
• Due to COVID-19 unemployment increased reaching 18.1% at end-September 2020 and 12%
of the employed population lost their jobs (74,000 persons)
• As a result of the pandemic and war, in 2020 the flow of remittances has fallen by almost 28%.
Source: IMF, WB, WFP, ArmStat.

5. Economic Losses and Vulnerabilities
More than 22,000 businesses
temporarily closed (50% more
than in 2019), 35% of these
businesses closed in Oct-Dec 2020
- during the months of Nagorno-
Karabakh conflict and when
COVID-19 pandemic was at its
peak.
Another 4,918 businesses shut
down permanently in 2020.
The Economic activity in Armenia in 2020 and 2021
(in percent of the same month in the previous year)

6. IMPACTS OF COVID-19 and
Nagorno-Karabakh (NK)-WAR-2020
Significant implications on the food and nutrition security
situation and poverty in Armenia
▪ Consumer demand has declined both in terms of volume and
frequency of purchases: consumers bought less frequently and in
smaller quantities, only staple items.
▪ Consumer demand declined due to decrease in the purchasing
power of the population
▪ Displaced population, refugees
▪ Market price hikes for several food commodities
▪ Significant fluctuations of the exchange rate of Armenian Dram
Prices for food products and soft
drinks increased by 8.3%
(April 2021 compared to April
2020).
Source: National Statistical Committee of Armenia,
May 2021
Displaced Population in Armenia
89,149 (Nov 2020)
36,882 (May 2021)
Source: Migration Services, Ministry of Territorial
Administration and Integration, Armenia and
IOM/DTM

7. Supply Chain Challenges
• Supply chains did not break in Armenia during COVID-19, but remained vulnerable to economic
dynamics in origin countries from where products or raw materials were imported.
• Supply chain challenges mainly manifested in terms of price increases rather than disruptions in
the supply chain
Source: WfP, RUEA, ArmStat, 2021

8. POLICY RESPONSES
To mitigate negative consequences of COVID-19, the Government initiated 25
Support Programs. Five measures directly related to food security:
• Program 1: Financing support to all industrial companies, including food
companies
• Program 2: Supporting agricultural actors, such as farmers and offers financing,
loans for all types of agricultural goals
• Program 3: Promoting small and medium entrepreneurship by offering loans
• Program 5: Providing salary support to enterprises continuously employing 2-
50 people.
• Program 24: Supporting grape industry in Armenia and helping food processing
companies to buy the harvest
Government assistance –
8.2 mln USD (credit subsidy)
Social protection -
52 mln USD
Economic programs –
62 mln USD
Funds made available
through banks –
360 mln USD
Support to agriculture
6.4 mln USD (credit subsidy)
and made available through
banks 182 mln USD

9. LOOKING FORWARD
OUTLOOK FOR POST-COVID-19 and POST-NK-WAR-2020 RECOVERY
▪ Geopolitical instability, demarcation and delimitation issues and tensions in the new border lines
with Azerbaijan, upcoming Parliamentary elections in June 2021 create many uncertainties for
the domestic and foreign investors….
▪ Pressure on 2021 state budget related to social support component due to the increased number
of people in need of government support.
▪ Government debt might increase to alarming 69% of GDP in 2021 based on IMF forecasts.
▪ Nevertheless, economic activity is gradually recovering in 2021, number of tourists increasing.
▪ More resilient policies must be developed to respond to future crisis.