New Diagnostic for Armenia Released on Strategic Pathways for Sustainable Development

The SCD offers a comprehensive analysis of Armenia's developmental challenges and opportunities, providing strategic pathways towards sustainable growth and the eradication of extreme poverty.

The World Bank has released its Second Systematic Country Diagnostic (SCD) for Armenia, titled "Beyond Boundaries: Unlocking Potential for a Sustainable Tomorrow." This report revisits and updates the initial diagnostic from 2017, taking into account significant changes in Armenia's socio-economic landscape, particularly its ascent to upper-middle-income status. The SCD offers a comprehensive analysis of Armenia's developmental challenges and opportunities, providing strategic pathways towards sustainable growth and the eradication of extreme poverty.

Key areas of focus in the report include:

Investing in Human Capital: The SCD highlights the importance of enhancing the quality of Armenia's human capital. It recommends improving education by focusing on quality and equitable access, particularly in rural areas, rather than merely increasing enrollment figures. The report also calls for reforms in healthcare financing to reduce out-of-pocket expenses, thereby ensuring affordable access for all and boosting the inclusion of vulnerable population groups.

Creating More and Better-Quality Jobs: Addressing Armenia's high unemployment rates, the diagnostic suggests targeted efforts to create more and better job opportunities. It emphasizes the need to bridge the skill gaps between job seekers and market demands through vocational training and education programs, which can enhance productivity and economic competitiveness.

Diversifying Trade: The report encourages Armenia to diversify its trade partners and exports to tap into under-utilized trade potential. This strategy aims to improve economic resilience against global fluctuations and increase competitiveness on the international stage.

Ensuring Access to Markets: As a landlocked country with challenging topography, Armenia faces significant barriers in physical connectivity and trade logistics. The SCD recommends investing in infrastructure and improving logistics and customs services to enhance access to goods, services, and employment opportunities, facilitating better integration into global value chains.

Building Resilience: The report advises Armenia to strengthen its resilience against shocks related to fragility, conflict, and climate change. It underscores the importance of empowering rural communities, vulnerable groups, and promoting gender equality.

Harnessing Technology and Diaspora: Recognizing Armenia's strengths in information and communication technology (ICT), the diagnostic suggests leveraging these capabilities along with the Armenian diaspora as a global resource. This approach aims to foster innovation, entrepreneurship, and knowledge exchange, enhancing Armenia's global connections and sustainable development.

This diagnostic forms the basis for the World Bank Group’s upcoming Country Partnership Framework (CPF) for Armenia, scheduled for release later in 2024. The CPF will outline the World Bank’s support for Armenia over the next five years, focusing on financial and analytical assistance to implement critical reforms.