As Prime Minister of the Republic of Armenia, I want to take this opportunity to welcome you to our new, yet ancient nation, that has been the economic and political crossroads between Asia and Europe for over 3,000 years. A small, rocky country on the southern fringes of the former Soviet Union/CIS, modern Armenia is in the midst of a rapid and painful transition, from a Soviet style planned economy to a democratic society with a market economy.

Radical political reforms are underway, and the appearance of small, private businesses has already changed the economic landscape. As a result Armenia currently enjoys macroeconomic stability and has begun to show slight economic growth. After an estimated 60 per cent decline in GDP from 1991 to 1993, we recorded a growth of 6.9 per cent in 1995, five per cent in 1996.

Armenia has made substantial progress in price liberalisation, enterprise restructuring, privatisation and the establishment of a market oriented legal framework. Our country was the first among the CIS to privatise agricultural land; we have also launched a global privatisation programme for major manufacturing and service industries. Since 1994 over 5,000 small enterprises and 1,500 large and medium-sized enterprises have been privatised. In 1997 the Government announced an international tender for the privatisation of 20 major industrial enterprises representing telecommunications, chemicals, electronics, construction, machine building, light (textile and shoe) industries, the famous Armenian brandy company and the three biggest hotels in Yerevan.

Our country's industrial potential, highly educated workforce, and government support of economic reforms guarantees a rapid rehabilitation of the economy and the establishment of normal trade and supply links. In turn these conditions will result in the successful implementation of proposed projects and a high return on investments.

At this time in Armenia's economic history, the role of investments, particularly foreign investments, cannot be overestimated. To support such investment the Government has established the legal and regulatory framework for export and investment promotion, and is implementing proactive strategies to bring Armenia into a viable competitive position with other countries. The State Investment Promotion and Protection Board was recently established to ensure the highest support, particularly for foreign investments in Armenia. Bilateral Investment Agreements (BIA) and Tax Treaties signed by Armenia, and the 'Law on Foreign Investments' provide the framework for international investor guarantees and security.

Currently Armenia offers attractive prospects for foreign businesses interested in investment and partnership opportunities in such areas as power generation/utilities, electronics and other high-tech industries, aviation, construction, apparel, tourism, food processing, industrial property acquisition, banking and other areas. The incentives Armenia provides to foreigners investing in the production sector include a national regime, a five year guarantee that government legislation will not be adversely changed, protection from nationalisation of invested assets, and certain tax incentives up to the tenth year of operation. The Government has also proposed establishing two special economic zones with special tax and regulatory regimes. All exports and production oriented imports are free of custom duties and taxes. We expect that Armenia will become a member of the World Trade Organisation (WTO) in early 1998. Armenia recently became a member of World Tourist Organisation.

As a result of the above developments, the number of registered enterprises with foreign investments increased from 174 to 353 in 1995, to more than 760 in 1997. The majority of these enterprises, such as Coca-Cola Bottles of Armenia, Midland Armenia Bank, Armentel, Global Gold Armenia, are joint ventures; the rest are affiliates or subsidiaries owned by foreign companies. Recently an investment fund of US$100 million was established by Kerk Kerkorian, an American Armenian businessman, to support industrial development in Armenia.

Currently one of the major gateways to the CIS markets, the Middle East, Europe and Asia, Armenia welcomes foreign investors as one of the most hospitable, safe, fast-growing, and attractive countries in the region and in the CIS. Welcome!