Closure of the Goris-Kapan road to reduce Armenia's income by $ 190 million

Baku/27.08.21/Turan: Following an Armenian attack on the Azerbaijani border guard and his injury, Baku blocked the passage of Armenian cars along two sections of the Azerbaijani-owned highway connecting the Armenian towns of Goris and Kapan, the copper production in Armenia might stop.

It is important to note that Armenia has no alternative route for passage of trucks and passenger cars. It will be put into operation in the autumn of 2021.

Official Baku has not announced its conditions for opening of this road. Azerbaijan will open traffic on the Goris-Kapan road provided  the Armenian side investigates the incident of Azerbaijani border guard's injury and punishes perpetrators to give guarantee that provocations will not be repeated, according to the head of the NGO "Military Officers" Telman Abilov and a member of the Azerbaijani National Public Committee for European Integration Togrul Juvarly.

It should be added that hundreds of Armenian passenger and cargo vehicles cannot pass through the closed road. Gagik Aghajanyan, director of the forwarding company "Apaven", explained that about a thousand tons of copper concentrate — the main export item of Armenia - are exported from Armenia to different countries every day. To deliver the concentrate to the Armenian capital, about 50 trucks a day ply the route from Syunik to Yerevan and back. Syunik province, after a ban on movement over Azerbaijani sections of the road, found itself in a transport blockade.

"Our trucks that went to Syunik for copper concentrate got stuck there and could not return back," Aghajanyan informed. The Kajaran copper-molybdenum deposit is located in Syunik, the largest deposit of copper-molybdenum ores on the territory of Armenia and the former USSR.

It has to be noted that the export of copper concentrate accounts for 24% of all Armenian exports. Nikol Pashinyan called copper "the oil of Armenia". The demand for copper at the world market is growing. Copper prices at the London metal exchange rose to $9,300 per ton. A year ago, during the lock-down, the price did not exceed $ 4,500. This year, the Armenian parliament increased the duty on the export of copper concentrate up to 15% which should bring an additional $ 140 millions annually to the budget.

Note that in 2020, the export of ore and copper concentrate amounted to $ 618 million (24% of Armenia's total exports). Hence, if Azerbaijan does not open the road for Armenian cargo, then within three months before the opening of an alternative route, only by suspending the export of copper concentrate, the Armenian economy will lose about $ 190 million. If the work of the Kajaran copper Ore Combine is resumed after the start of operation of another road, it will be difficult for Armenian exporters to attract the former buyers of copper concentrate, the largest of which are in Bulgaria, Spain and China.-0-