Expert warns of deepening deindustrialization in Armenia

Armenia’s industrial sector contracted by 5.7% in January-September 2025, with total output amounting to 2.055 trillion drams (about $5.3 billion), according to the National Statistical Committee.

In a social media post on Wednesday, political analyst and professor Vahe Davtyan said the sharpest decline hit manufacturing, the core of industrial development, which dropped 10.2% after recording 18.9% growth a year earlier. Output stood at around 1.4 trillion drams. September saw a 9.6% month-on-month rise to 205.8 billion drams, but Davtyan noted that this was not enough to offset overall losses.

Metallurgy fell by 10%, reversing last year’s 7% gain. Davtyan called this “a serious signal” as the sector has traditionally been a key driver of industrial exports. Mining output declined only by 0.5% to 360.5 billion drams, easing from a 7.8% drop in 2024, though September again showed a 0.4% fall to 48.5 billion drams.

Meanwhile, the services sector expanded by 9.9%, up from 5.9% growth last year, reaching 2.9 trillion drams (around $7.5 billion). The sector has now surpassed industry as the main contributor to GDP.

Davtyan warned that the overall trend points to deepening deindustrialization and an economy increasingly dependent on services, reflecting “not a temporary crisis, but the absence of a long-term industrial policy and economic security doctrine”.