Brief overview
A market economy is one of the types of economic systems and includes such key elements as free market pricing, the predominance of private ownership, and competitive entrepreneurship. It is based on various forms of ownership of the means of production and on contractual relations among economic entities, with minimal state intervention in economic activity and in the regulation of the economy. In countries where this type of economic system is applied, the main actors are producers and consumers.

The economy of the Republic of Armenia is considered a free market economy, meaning that the state provides incentives, moderately intervenes in and regulates market relations, determines the development of those sectors and branches of the economy that will lead to economic growth, targets social issues, and so forth.

Granting of Market Economy Status (MES) to the Republic of Armenia by the United States
The main purpose of obtaining Market Economy Status (MES) from the United States is the application of that status in possible anti-dumping proceedings concerning goods exported from the Republic of Armenia and, consequently, the protection of the country’s domestic market. In other words, during possible anti-dumping investigations concerning companies exporting goods from Armenia to the United States, the U.S. government would rely on Armenia’s national data, rather than on unfavorable pricing data for the same product from “third” countries. At the same time, Market Economy Status serves as a reliable trade defense instrument; moreover, by obtaining this status, Armenia would become more attractive for business, and foreign investors in Armenia would gain greater confidence.

The acquisition of MES from the United States constitutes a special process aimed at clarifying and verifying the country’s compliance with each of the six criteria established by the United States.

The six criteria established by the United States for obtaining market economy status are:

1. Currency Convertibility: The extent to which the country’s currency is convertible into foreign currencies.
2. Wage Determination: The extent to which wage rates are determined by free bargaining between labor and management.
3. Foreign Investment: The extent to which joint ventures or other investments by foreign firms are permitted.
4. State Ownership: The extent to which the government owns or controls the means of production.
5. Government Control of Resources/Prices: The extent to which the government controls the allocation of resources and price/output decisions of enterprises.
6. Other Factors: Any other factors that the administering authority (Department of Commerce) considers appropriate.

For the purpose of obtaining Market Economy Status for the Republic of Armenia from the United States, the Ministry of Economy of the Republic of Armenia initiated the relevant process.

Within this framework, a summary report was prepared and submitted through the ACCESS system of the U.S. Department of Commerce on 21 December 2023, on the basis of which the review process of Armenia’s status was officially launched on 13 February 2024. Subsequently, on 5 April 2024, a full comprehensive report was submitted, and in response to the counterarguments presented by the U.S. side and the companies involved, additional clarifications and justifications were provided. The process currently remains ongoing.