US embassy cable - 05YEREVAN1806

UNCLAS YEREVAN 001806 
 
SIPDIS 
 
SENSITIVE 
 
E.O. 12958: N/A 
TAGS: ECON, ETRD, EINV, PREL, AM, WTRO 
SUBJECT: DEMARCHE DELIVERED: WTO/DOHA TALKING POINTS 
 
REF: STATE 180336 
 
Sensitive but unclassified.  Please protect accordingly. 
 
1. (SBU) On October 4 we delivered reftel points to Deputy 
Minister of Trade and Economic Development Tigran Davtyan. 
Davtyan said free trade is a GOAM priority and that the 
average tariff rate in Armenia is three percent.  This 
average reflects the total amount collected under a 
streamlined tariff system whereby the GOAM collects no tariff 
on capital goods and a ten percent tariff on consumer goods. 
Davtyan pointed out that a proportional reduction in tariffs 
collected by WTO member states would be particularly 
burdensome on countries, like Armenia, which already have low 
rates.  He argued that the WTO should put pressure on 
countries with high tariff rates before asking countries with 
low rates to further reduce tariffs. 
 
2. (SBU) On the issue of subsidies, Davtyan told us that 
Armenia has no export subsidies for any products, including 
agricultural products.  He said the GOAM provides between 
five and ten million USD annually to the country's 
agricultural sector primarily through irrigation projects and 
micro-loans.  According to Davtyan, in order to meet its 
obligations under the WTO, the GOAM must begin collecting VAT 
on agricultural products in 2009.  Davtyan expects that 
subsidies to farmers will increase when VAT collections 
begin, because the GOAM will want to minimize the burden on 
local farmers.  He said that any such increase would not 
exceed the amount permissible under current WTO regulations. 
EVANS