A small, landlocked country in the Caucasus region, Armenia struggled to recover from the severe economic setbacks caused by the collapse of the Soviet Union in the early 1990s. In 1994, Armenia adopted a comprehensive stabilization and reform program that transformed it into a liberal market economy and launched a period of growth that saw its GDP increase at an average annual rate of 8 percent over the next decade.
This period of growth disproportionately benefited inhabitants of the capital, Yerevan, while the rural poverty rate remained above 30 percent. More than one million Armenians, or about 35 percent of the population, lived in rural areas and were dependent on semi-subsistence agriculture at the time of compact development. These farmers were operating on small, fragmented parcels of land and were constrained by poor infrastructure and an underdeveloped agricultural economy.
At a Glance
- Original Amount at Compact Signing: $235,650,000
- Revised Compact Amount: 177,000,000
- Amount spent: 176,550,000
- Signed: March 27, 200
- Entry Into Force: September 29, 2006
- Closed: September 29, 2011
- 427,623Estimated beneficiaries over 20 years
- $150,440,000Estimated net benefits over 20 years
Estimated benefits correspond to $176.55 million of compact funds, where cost-benefit analysis was conducted. Net benefits refer to discounted benefits minus discounted costs.