Recent developments surrounding Iran have prompted renewed concern over their potential impact on Armenia’s economic relations with both Tehran and Washington, as the United States moves to impose new trade restrictions.
US President Donald Trump announced that countries engaging in trade with the Islamic Republic of Iran will face a 25 percent tariff. The decision was made public via social media, where Trump stated that the measure is final and not subject to appeal.
Iran is one of only two countries with which Armenia shares an open land border, and trade between Yerevan and Tehran has been steadily expanding in recent years. At the same time, Armenia has been developing closer relations with the United States, raising questions about how the latest US measures could affect the country’s economic positioning.
According to official data, Armenian-Iranian trade turnover reached $748 million in 2024. Growth continued in the first half of 2025, surpassing $340 million. Armenian officials expect bilateral trade to first exceed $1 billion and eventually reach $3 billion.
Speaking at an Armenian-Iranian business forum held in Yerevan in August 2025, Armenian Prime Minister Nikol Pashinyan said trade between the two countries has shown consistent growth in recent years.
“Imports from Iran have increased by more than 10 percent year on year, reaching $300 million,” Pashinyan said. “As for exports, despite a slight decline, they continue to include electricity, copper concentrate and agricultural products.”
Economist Agasi Tavadyan, an expert at the Amberd Research Center, told Public Radio of Armenia that despite growth, trade volumes remain relatively modest given Armenia’s limited access to open borders.
“Iran is essentially one of Armenia’s two open gateways. Armenia primarily imports gas and exports electricity. In this sense, Iran functions as a ‘battery’ for Armenia – when we have surplus electricity, we sell it to Iran,” Tavadyan explained.
He added that exports of other goods have also expanded in recent years, recalling the agreement on the establishment of a free trade zone between Iran and the Eurasian Economic Union. However, Tavadyan warned that certain exports – such as livestock and cheese – may become more difficult due to the depreciation of the Iranian rial, which has driven up prices.
As for imports from Iran, including cement and other construction materials, Tavadyan said no major changes are expected. He noted that Armenia’s government has repeatedly applied restrictions and quotas on such imports to protect domestic producers.
Trade between Armenia and the United States remains limited, although it has shown steady growth. Since 2020, bilateral trade has more than tripled – from $96 million to approximately $350 million.
“Trade volumes with Iran and the US are at roughly comparable levels, around 3 percent,” Tavadyan said. “In fact, trade with the US is even lower. The issue here is geopolitical rather than purely economic, as the US is one of the world’s most influential global actors.”
Meanwhile, anti-government protests in Iran have continued for more than two weeks. On December 28, merchants at Tehran’s main bazaar closed their shops in protest against the country’s worsening economic situation. Demonstrations later spread to other major cities and gradually took on a political dimension.
Hasmik Dilanyan
Public Radio of Armenia
