Analyst warns of diverging economic trends as Azerbaijan boosts exports and Armenia faces investment concerns

Political analyst Hakob Badalyan has warned of widening economic differences between Armenia and Azerbaijan, arguing that recent trade trends highlight contrasting trajectories between the two countries.

Citing Azerbaijan’s export figures for the first half of 2026, Badalyan said the country’s exports exceeded $15 billion, marking an increase of nearly 50% compared with the same period a year earlier. Imports, meanwhile, declined by nearly 31%, resulting in a foreign trade surplus of more than $8.5 billion.

Badalyan said he was not comparing the absolute size of the two economies, noting Azerbaijan’s advantage from its oil and gas resources, but argued that the direction of economic trends was significant.

According to figures cited by the analyst, Armenia’s exports declined by more than 3% in January-May 2026, while imports increased by more than 2%. He said the contrasting patterns showed Azerbaijan strengthening its export position while Armenia was moving toward a larger trade deficit.

“Simply put, we are turning our economy into a consumer economy,” Badalyan said, arguing that continued difficulties in Armenia’s agricultural sector could further deepen the trend.

He also noted that Azerbaijan’s export growth was not limited to the energy sector, pointing to increases in agriculture and agro-industrial exports. While acknowledging that external market conditions may have contributed to Azerbaijan’s performance, including developments in the oil and gas sector, Badalyan said the key issue was how effectively each country used favorable economic circumstances.

Badalyan argued that Armenia had failed to fully capitalize on new trade opportunities created by geopolitical shifts, including changes in regional commerce following Western sanctions against Russia. He said declining trade volumes with Russia represented billions of dollars in potential economic losses for Armenia.

“The government’s task should have been to create an environment where these opportunities could be effectively invested and used to expand Armenia’s economic potential,” he said.

Instead, Badalyan criticized a focus on political considerations over economic development. He claimed that disputes affecting property rights and the investment environment were damaging Armenia’s reputation among international investors.

“The institution of property rights is effectively being undermined in Armenia,” Badalyan said, arguing that this was harming the country’s investment credibility.

He warned that Azerbaijan’s growing revenues and expanding investment capacity could increase Baku’s ability to exert strategic pressure on Armenia.